Contract Administration and Project Management
Contract types and the scope document
The contract defines the deal: lump sum (fixed price for defined scope), time and materials, cost plus a fee, or unit price. The drawings and specifications together form the scope; when they conflict, the contract's order-of-precedence clause decides. Read notice provisions carefully, because courts enforce them strictly - miss a 7-day written notice for a delay and you may waive the claim entirely.
Change orders and the paper trail
No change should proceed on a handshake. A written change order states the scope, the price (labor, material, overhead and profit, plus any time extension) and is signed before work begins. Oral directions from a superintendent should be confirmed in writing the same day. Keep RFIs, submittals, daily reports, and photos - documentation is what wins disputes.
Schedule, completion, and closeout
Track long-lead fixtures against the schedule; a missing carrier or specialty valve can stop a rough-in inspection. Know the difference between substantial completion (owner can use the work; punch list remains) and final completion (punch list closed, closeout documents delivered). Closeout typically includes as-builts, O&M manuals, warranties, and final inspection cards.
Payment mechanics
Retainage (commonly 5–10%) is withheld until completion. "Pay-when-paid" delays payment; "pay-if-paid" can shift the risk of owner default to you - very different clauses. Liquidated damages are a pre-agreed amount per day of delay. Worked example: a $60,000 change order with 15% overhead and profit plus a 5% retainage holdback bills $69,000, less $3,450 retainage, for $65,550 current payment.