Being fair can improve your construction business
Thursday, July 23, 2015
Honesty, respect, integrity, ethics. These values are the backbone of any successful business. In the construction industry, every party on a project is so interconnected that these four values are not just important to a single party or one contract, but are fundamental to the entire project.
The fragile and risky environment of a construction project and the interrelated nature of payment disputes can cause a domino effect if parties start playing a little dirty. It seems all too easy for construction payment to devolve into "well if he's not playing fair, I'm not going to play fair, either."
Here are a few reasons why you should play fair — no matter what.
Fair practices result in a smooth project
It is no secret that when people are playing by the rules, the results tend to be a lot more positive than the alternative. In a construction project, when all parties treat each other with respect and are fair to one another, they save time and money.
Many times, the cases and disputes that arise from construction projects involve things that don’t quite pass the smell test — if not actual foul play or unethical practices. When not done for specific, defined and explainable reasons, acts like intentionally sending late payments or withholding payment all together can breed ill will, cause problems throughout the payment chain, and make completing the project on time and budget much harder.
Furthermore, this ill will can lead to expensive legal battles and hurts all parties involved with the project. Acting spiteful is immature and will benefit no one. Avoid it.
However, payment shenanigans due to spite or ill will are not the only thing that creates difficulties on a construction project. Honesty is an important factor that plays as significant a role in the construction industry. When parties are honest about problems they may be facing, preventative measures can be taken and catastrophes can be avoided.
While there is an exceptionally powerful remedy for encouraging payment built into the law of every state through the mechanics lien, this instrument can be misused by dishonest parties. Filing a lien when no money is owed, or for more than is actually owed, to attempt to get more than deserved or to cause problems for the property owner for other reasons is not only dishonest, it's also illegal.
Being honest about payment disputes, workmanship disputes and/or other disputes can save time and money in the long run — even if it's sometimes hard to do.
Courts reward good behavior
Good behavior is rewarded. This is common sense.
If a legal dispute arises and you must litigate, it never hurts to be the party that followed the rules. Make sure that party is you. There have been cases where a party was likely correct in at least some sense, but the court was disinclined to award them anything because of their spiteful and unethical acts.
If you have to go to court, don't give the court a reason to be more picky about your argument.
Reputation is everything
At the end of the day, your business is as good as its reputation. If everyone in the construction industry knows you as someone who causes problems, not many parties are going to want to work with you.
By acting ethically, you are building strong work relationships with other parties. These relationships will pay off in the end. You will receive prompt payment, get more business and thrive.
It just makes sense. Would you want work with someone who has a reputation for causing problems? Treat others how you would want them to treat you.
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