A new year may accompany new goals; for some, those goals may include designing and building a custom dream home.
Assuming you are not a contractor, building a custom home will not only involve significant financial investment but also lengthy contracts, coordination and negotiations. To streamline the process, prospective homeowners often turn to design and build contracts to make their dream home a reality.
But what is a design and build contract – and how do you know you’re minimizing risk and protecting your investment throughout the process? In this blog post, we will cover the basics of design and build contracts and how a lawyer can help you seamlessly navigate the process.
What is a Design and Build Contract?
Design and build contracts cover both the design and the building process of a custom home or other project. Rather than signing multiple contracts with architects, contractors and other professional parties, the person(s) seeking to build their dream project is only required to sign one contract with a firm that handles the design and build aspects. This blog post will refer to these people as the “builder.”
When are Design and Build Contracts Used?
Design and build contracts are commonly used for custom home projects. However, they can also be used for complex home renovations, for example, if your renovation requires an architect or design firm in addition to contractors.
What are the Benefits of Design and Build Contracts?
There are several benefits to design and build contracts. Primarily, the simplicity of only dealing with a one-stop shop when it comes to contracts makes the prospective homeowner’s life a little bit simpler. Dealing with one party (the builder) rather than juggling different parties and contracts streamlines the process. Additional benefits of design and build contracts include the following:
Saving Time and Money
A design and build contract can help you save both time and money. Rather than hunting down contractors, and coordinating with parties throughout the project, the builder acts as a single point of contact and can ensure that work is completed smoothly and efficiently.
Minimizing Confusion
Hiring a party with a design and build contract helps minimize the confusion of a large-scale build project. The design and build contract will outline the project requirements early on, ensuring that the parties understand their respective duties and concerns are raised as quickly as possible. This process helps ensure everyone remains on track and communication between the parties can be easily facilitated.
Avoiding “Finger-Pointing”
In a traditional custom-build project, different parties may have different expectations or interests and, if something goes wrong, they may (rightly or wrongly) foot the blame on another party.
With a design and build contract, prospective home builders avoid the potential pitfalls of having “too many chefs in the kitchen.” The builder is ultimately responsible for the project and works collaboratively with the other parties involved to ensure that the project is completed to appropriate standards.
How Do Lawyers Help with Design and Build Contracts?
Having a lawyer’s input can make a substantial difference for any contract. While prospective home builders benefit from the efficiency and convenience of a single contract for their project, it also means that they need to be especially careful when creating and agreeing to the terms of the design and build contract.
Drafting a Design and Build Contract
If you’re a prospective home builder, you may be in one of two situations: you’ve already received a design and build contract drafted by the builder, or you need to draft a design and build contract for your project. In either case, the contract will contain a lot of information and terms relating to the project.
Once you have signed the contract, you will be bound by its terms. Well before you sign an agreement, it is important to speak with a lawyer familiar with design and build contracts to ensure the contract accurately reflects your interests and protects you from potential risk and liability.
Negotiating Terms for a Design and Build Contract
In some cases, you may need to negotiate with the builder regarding particular terms. Consulting a lawyer early in the design and build process can help you understand your rights and navigate the terms to understand what you are prepared to agree to. Going one step further, your design and build contract lawyer can handle the negotiation on your behalf.
Pursuing Alternative Dispute Resolution or Litigation
If things go wrong during the project or after the fact, it is important to ensure that your rights are protected. Consulting a lawyer helps you understand your rights and, if necessary, pursue dispute resolution procedures to ensure that disputes are resolved as efficiently as possible. If necessary, a lawyer can also file court applications or represent you in litigation.
Oakville Real Estate Lawyers Representing Buyers for Design and Build Contracts
The Oakville real estate lawyers at Campbells LLP represent homeowners looking to custom-build. We are among a few practitioners in the province who regularly counsel clients on design-build projects. We advise on all types of design and build contracts, including bridging, turnkey, design-build-warranty, and design-build-maintain.
We provide a wide range of legal services related to buying and selling property and are here to meet your real estate law needs. To speak with one of our experienced real estate lawyers, contact us online or call us at 905-828-2247.
