About construction contracts

On Behalf of | Jun 21, 2018 | Contract Disputes

There are many different types of construction contracts Missouri builders can use. However, there are a few that they prefer to use more than others.

A construction contract is a legally binding agreement in which the builder and the owner agree that a certain amount of compensation will be paid for the execution of a job. The contract will also detail in which manner the owner will disburse compensation.

The categorization of the different types of construction contracts depends in large part on the manner in which the disbursement will be made. The contracts also provide other details about the construction project, including how long it is supposed to last, quality requirements, specifications and other features. There are many variations of the major types of these contracts, and the contracts can be customized so that the particular needs of the project are addressed.

A cost plus contract is one in which the actual costs, expenses and purchases related to the construction activity are paid. This type of contract requires that specific details be provided about the pre-negotiated amount that will cover the contractor’s profit and overhead. The costs must be clearly noted and classified as either indirect or direct costs. Cost plus contracts are usually used when the scope of the job is not clearly defined and when the owner has the obligation to create some restrictions on the amount of money that will be billed by the contractor. With this type of contract, the owner’s interests are protected, and the owner can avoid being saddled with pointless charges.

An attorney who practices contract law may assist clients involved in construction contract disputes. The attorney may engage in litigation to protect the interests of builders or contractors against parties who failed to honor the terms of the agreement.


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Long & Robinson, LLC
1800 Baltimore Avenue
Suite 500
Kansas City, MO 64108

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