How to Win a Scope of Work Contract Dispute
Given the complex nature of construction contracts, disputes are commonplace in the contractual relationship. One area that is often the basis of dispute is the scope of work provision in the contract. Scope of work describes, with specificity, what is expected from the contractor and it is used as a tool for the construction manager to ensure that the project deliverables are met. If the deliverables are not met, a can dispute ensue. This usually the case where the parties disagree on what the provision meant. In this scenario, a judge can point to several interpretive modes to determine how to resolve the dispute. A judge can look to the contract, the business relationship or industry standards.
The “Four Corners” of the Contract
The most common manner of interpreting scope of work provisions is to go the contract itself. The four corners of the agreement should outline the limits of scope of work including the services and deliverables expected from the contractor. The judge, in this instance, does not look outside of the contract for side agreements and verbal iterations of the parties’ understanding. This is a strict stance to take, but it ensures fairness in the written understanding of the contract. A more liberal version of this interpretative mode is to interpret scope of work terms by looking at the contract as well as any verbal understanding that is provable and admissible in court.
Past Business Dealings
If the parties to the construction contract have a prior business relationship then the court tasked to interpret the contract can look to past dealings. This interpretive mode will include a review of past contracts and the types of services delivered at the end of previous projects. This mode of interpretation will also seek patterns in the business relationship to predict the parties’ expectations in the current matter. Unlike the previous mode of interpretation, looking into past business dealings can become rather murky. It may also invite an unfair result where one party feels unfairly treated in previous business transactions.
The least personal interpretive mode when determining the scope of work is to rely on industry standards. Courts will tend to stay away from using industry standards because the desired outcome of the parties may be substantially altered. In addition, the outcome may stray too far from the original meaning that is found within the contract. A court using industry standards will review what is customarily delivered given the type of services. They may also permit testimony from industry experts to arrive at their decision. The danger when relying on industry standard is distorting the original intent and understanding of the contracting parties.
Fort Lauderdale Construction Law Attorney
Sweeney Law, P.A. is a knowledgeable construction law firm with years of experience advising professionals in the construction field by assisting with the drafting and review of construction contracts. Fort Lauderdale construction attorney Brendan Sweeney is here to guide you through legal pitfalls that can arise as a result of a poorly written scope of work provision. Contact us now for a consultation.