Why Are Contracts Important? What Every Contractor Needs to Know

Construction contract with an approved stamp.

Your contract is everything when it comes to working in construction. If an issue comes up, it might seem easier just to say, “It’s grand; we’ll figure something out,” and try to sort things out yourself. But, when it comes to construction contracts, especially under the Construction Contracts Act 2013, the key to success is sticking to the terms of the contract.

If you don’t follow the contract to the letter, you risk undermining your own position. So, how do you navigate it? Let’s break it down.

Follow the Contract – No Exceptions

The Construction Contracts Act 2013 outlines clear guidelines to protect you and your client. If your client or the main contractor says, “You’re being too contractual; we don’t work like that,” you can say, “We’re only doing what was written in your contract.”

Contracts are there for a reason. When everyone knows the rules, disputes don’t get out of hand, and you’re protecting yourself and your business. If you stray from the contract—even by a day—you could lose your claim or compromise your position. There’s no point ringing someone and saying, “I’m a day late, can we sort this out?” Once it’s missed, that’s it. It’s fair and straightforward.

Here’s a look at what should be done: 

Here’s a procedure for timelines: 

Procedure and Timelines Matter

Construction contracts outline specific procedures and timelines for a reason. If a payment claim is due, there’s no room for delays or informal agreements. These timelines keep the project moving smoothly and protect your right to be paid on time.

If you’re not getting paid or hitting roadblocks with your payment claims, your first step should always be to refer back to the contract. By sticking to the contract and the Construction Contracts Act 2013, you’re operating within the law and maintaining your credibility.

Two construction workers standing in front of an excavator

Conclusion: Stick to the Process

The contract is your safety net. Following it to the letter means you don’t undermine your business. If there’s a dispute or things aren’t going according to plan, always refer back to the contract. It might be annoying and time consuming but better to spend those extra few minutes reading it than losing out on thousands. 

If you need help reviewing your contracts and understanding the terms, contact us today at Carroll Estimating to find out how our expert team of QS and Estimators can support you in clarifying the terms of your construction contracts. 

When you work with us, we become part of your team.

Start building profitably, confidently today with Carroll Estimating.