AboutC. R. Construction Expertise All construction related, remodeling related, home improvement related, do it yourself related, and generally generic or specific trades related and construction contract law related questions.
Experience 30 years in the construction industry. Commercial and Residential
Organizations Licensed General Contractor in 2 States
Question Typically in international trade LC's, shipping documents, inspection certificates and contracts are used to assure product quality, performance and payment.
1. In construction what mechanisms/instruments are used to irrevocably promise construction/payment of a structure as per specification without no funds exchange until the job is done and verified to be completed as per stated specification?
Though international trade and construction are two different industries alltogether I imagine the same or a collection of similar mechanisms/instruments/methods can be utilized for the same result.
2. Can you comment on the use of SGS or any other international inspection or testing agency to assure a structure has been made to certain specifications used in the construction industry?
3. Since projects sometime take years till completion maybe L/C's just don't don't quite do it for construction, but how else can you make partial payments for different phases and still be guaranteed that you get what you specify and can be assured/insured that if any screw up or catastrophy happens along the way you get your money back or have some kind of recourse besides lengthy litigation and headaches?
I understand a airtight contract is the mother of good agreements but what mechanisms are typically integrated? An escrow? Bond, Insurance policy... can you in brief/general verify/specify names of instruments, types of policies?
Answer Construction bonds and payment vouches per inspection, are the typical methods of protecting a job. Material specifications are not an inspecting issue in the building department, so you need an ON SITE manager to qualify all materials to be incorporated into a structure. You need shipping labels from the manufacturers if steel is used. You need affidavit of quality of concrete variables are used. There are many mechanisms that work...but really slow a project to a crawl for Near absolut control of the product. There is no "air tight contract" God can influence a project...unforseen occurances..... Cost overuns and change orders abound.
