MN General Contractor study materials
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MN General Contractor: Contract Law, Liens, and Project Administration

MN General Contractor · Work through your exam, one topic at a time.

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Contract Law, Liens, and Project Administration

Contract fundamentals

A construction contract needs offer, acceptance, consideration, and a lawful purpose. The written documents control: scope, schedule, contract sum, payment terms, retainage, change-order procedure, notice requirements, indemnification, and dispute resolution. Two Minnesota-specific points matter. First, statutes limit indemnification clauses that purport to make one party indemnify another for that other party's own negligence, so broad-form indemnity language is often unenforceable. Second, change orders and notice provisions are enforced strictly - verbal direction to proceed is a classic dispute generator.

Mechanic's liens

Mechanic's lien rights in Minnesota come from statute, not the contract. The sequence to memorize: pre-lien notice, then recording of the lien statement, then timely foreclosure.

  • Pre-lien notice: a subcontractor or material supplier on a residential improvement must give the owner written notice generally within 45 days after first furnishing labor or materials; a contractor dealing directly with the owner gives notice much earlier, commonly within 10 days of agreeing to the contract.
  • Recording: the lien statement must be recorded within 120 days after the last item of labor or material is furnished.
  • Enforcement: suit to foreclose must be brought within one year after the lien statement is recorded, or the lien is lost.

A subcontractor who misses the pre-lien notice can lose lien rights entirely, which is why the notice is mailed with proof of service.

Project administration

The administrative controls that prevent claims are: a submittal and RFI log, documented daily reports, a written change-order log, meeting minutes confirming verbal decisions, and a punch list tied to substantial completion and release of retainage.

Rule of thumb

If it is not in writing and delivered with proof, assume it did not happen.