Trent Cotney, CEO, Cotney Attorneys & Consultants
The Champlain Towers collapse in Surfside, Florida was a national tragedy. Over 100 people died in one of the deadliest engineering failures in American history. The families of victims have been searching for answers for some time and the litigation will be both lengthy and costly – a process that will play out with plenty of finger-pointing and arguing over who is truly at fault.
From a liability perspective, the Surfside tragedy serves as an grave reminder of the importance of documentation. Whether your project is big or small, simple or complex, ensuring you have a detailed account of the existing structural integrity (or lack thereof) is extremely important.
Twenty years ago, a contractor could complete a construction project with a handshake and an invoice. Getting payment from customers has always been an issue, but the need for contracts and written documents was not as important as it is today.
Owners have become litigation and insurance savvy and know how to take advantage of an unprepared contractor. If a problematic project results in litigation, 9 times out of 10 the party with the best “paper” will win the day. In other words, the party that has the most detailed and descriptive paper trail supporting its side will more than likely succeed in court.
A contractor, subcontractor or supplier’s first line of defense to claims on a construction project is always the contract. The contract contains pertinent provisions that a party may use to pursue and defend potential claims. Although it is often difficult to negotiate the terms of a contract, a contractor, subcontractor or supplier should be aware, to the extent possible, of provisions that would help shield it from potential liability claims. These provisions may include limitations on the types of damages that can be awarded, such as a provision that waives the ability to obtain consequential damages (pain and suffering, lost profits, loss of business reputation, etc.). In addition, contract provisions that require owners to provide written notice to contractors within a certain
time period (three business days) after the discovery of defective workmanship, may create a defense to an owner’s claims if the owner failed to provide sufficient notice.
Anyone involved in the construction industry should also keep accurate written records of all communications involving defective workmanship, delays or other claims on a project. These written communications can include daily reports, email, memoranda, phone messages and letters. Furthermore, if you notice defective work (that is not your own), make sure to take extensive photographs or video of the alleged problems. Visual depictions are especially useful in defending claims where contractors are
hired to repair a building that is already suffering from defective conditions, water intrusion or pre-existing mold. For example, if you encounter bad decking, rotten trusses, water retention in lightweight concrete, etc., take photographs and video of the conditions and the site before you start work. You can then reference the photos and videos in the event there is an issue.
A party should also use common sense when issuing or authoring written communications. Barring any contractual provisions to the contrary, a good rule of thumb is that if it is good for you, meaning that it can assist you with bringing or defending claims, put it in writing. If it’s bad for you, pick up the phone and avoid putting something in writing that can later turn out to be a smoking gun if you are in litigation or arbitration.
Once the contractor has generated documents such as the contract, daily reports and follow-up correspondence, it is important that the contractor retain those documents in an organized file, especially if there is the possibility that the project could result in litigation. By generating and retaining documents that support the contractor’s position, a contractor will be better able to defend itself against litigious owners.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.
Trent Cotney is Board Certified in Construction Law by the Florida Bar, an advocate for the roofing industry and FRSA General Counsel. For more information, contact the author at 866-303-5868 or go to www.cotneycl.com.
Previous Article
Next Article