Real Estate Transactions Attorney in Minneapolis, Minnesota

Commercial Construction Contracts: Basic Considerations

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On the commercial side, for building contracts, there’s really – there isn’t a required form. So, no one has to use a certain form, at least, certainly, in Minnesota. But the AIA – the American Institute of Architects – has issued a series of forms that is sort of the 10,000-pound gorilla. There’s another group of contracts, called “consensus docs,” which were also created. And every 10 years, these get revised, and they’re very involved. There’s ones involving a fixed price; there’s cost-plus; there’s cost-plus guaranteed maximum price; there’s design-build contracts. There’s a whole bunch of contracts.

And if you’re representing a builder developer, you really – and even an owner – you want to make sure that your lawyer’s looked at those provisions and made sure a, no one’s made changes to them – ‘cause a lot of people do – and then, b, it deals with a whole bunch of issues, like when you’re entitled to be paid, change orders, change directives, when the work is completed. All those issues are addressed in these contracts, and that’s something where you really need to be careful. The devil is in the detail, but I think the devil’s sort of fun, too.

So, that’s where you really are on the commercial side.

Minneapolis business attorney Stephen Yoch of Felhaber Larson discusses how the American Institute of Architects (AIA) has forms that should be considered when drafting contracts.

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