General contractors work hard to get the money they’re owed to complete a project in a timely manner. Draw requests play a key role in making sure that is possible, but when a draw request dispute arises it can delay the project, make the project more expensive, lead to loss of labor, and more.
At Florida Construction Law Group, we handle these disputes to make sure contractors have the funds they need at the time they are supposed to get them. We fully understand the risk these disputes create for any project. There are several steps you and your team can take to avoid these disputes.
Set a Clear, Reasonable Schedule
These contracts are set on a schedule that dictates when and how draw requests can be made. However, it’s not as simple as setting dates and times for these payments but about paying out draw requests as the project progresses. Once work is completed and confirmed to be completed then the draw request for the next step of the project can be made and fulfilled.
Understanding this schedule will help you avoid disputes down the line. You need to make sure you understand each part of the schedule negotiation, what work is expected of you and your team, and other details within the documents. Be sure to keep any agreements in a secure and accessible place so you are able to review any details you need down the line.
The “reasonable” portion of this is also imperative. Both sides should go into the project with realistic expectations about what the work is, what it will take to get it done, and when it should be done. Everybody wants quick work but what everybody needs is quality work. You shouldn’t be forced into a contract that expects you to complete the work too quickly or that separates the funds out to a point where you won’t be able to purchase the necessary equipment, tools, and supplies for that portion of the project.
Keep All Receipts
Record-keeping on any project is a must. You can’t expect to be paid for your work or settle disputes down the line if you don’t have evidence of what’s being done. If you have an invoice for any previous draw request as well as any receipts for work done then the draw request process should move quickly.
Any contract will clearly state that proof of completion will be necessary to execute a draw request. The more organized and thorough your records are the quicker draw requests can be completed.
Document and Explain Changes
Any experienced contractor knows construction projects generally face a few changes. These changes are nearly inevitable but they’re also understandable. However, changes could derail the draw schedule you’ve already agreed to which is why documentation of these changes is necessary.
You and your team will need to showcase the reasoning for a change which could be related to weather, supplies, funding, ownership, or another unforeseen circumstance. When this happens, you will file a change order that explains the reason for the changes, what the changes are, and what additional costs may be associated with the change.If you’ve taken these steps then your project and draw schedule should be able to move forward without any disruptions. However, even the most thorough project can end up with disputes for various reasons. Contact the team at Florida Construction Law Group if you’re dealing with a draw request dispute that is disrupting your ability to do your job.
