What Are the Most Common Types of Commercial Construction Contracts?

Illinois commercial real estate lawyer, IL real estate attorney, A commercial real estate development project will often represent a lucrative business opportunity for all parties involved. However, significant construction may be needed before a developer can realize the full potential of a property. Whether a new building will need to be built, an existing building will need to be refurbished, or other types of construction will be needed to ensure that a property will be able to serve its purpose, these construction projects can represent a major investment of time and money. To ensure that work will be completed properly, a construction contract will be needed, and the right type of contract should be selected based on the work being done.

Four Types of Construction Contracts

When parties sign a contract, they are making a legal agreement, and they will both be required to meet their contractual obligations. A contract should fully outline the scope of the work being performed and the responsibilities of each party. It should state the price of the project and how this amount may change if unforeseen circumstances occur, and it should detail a payment schedule and the penalties for late payments. Any relevant documents, such as blueprints and specifications, should be included in a contract.

Depending on the needs of the project, a contract will typically fall into one of the following categories:

  • Lump-sum/fixed price – A contract may specify the total amount that will be paid to a contractor for all of the work performed during a construction project. This amount is usually based on the contractor’s estimate of the costs of work performed, along with a markup that will allow them to earn a profit. Since these contracts are not very flexible, they are usually used in projects that involve easily-defined work with a set schedule and little chance of changes.
  • Time and materials – In this type of contract, a builder will be paid on a regular basis (usually daily or weekly) for the costs of materials and labor. These contracts are more flexible, and they are usually used in situations where the full scope of a project has not yet been defined.
  • Cost-plus – A contract may specify that a builder will be paid based on the actual costs of completing a project. The builder will be reimbursed for expenses such as materials and labor, and they will also receive an additional amount, which may be a fixed fee or a percentage of the total costs. These contracts allow for flexibility while a project is ongoing, and they may protect the property owner’s interests by specifying a maximum price that will be paid.
  • Unit pricing – For smaller projects or those which require detailed accounting, a contract may specify the exact costs involved for all materials and tasks. These contracts can ensure that a property owner knows exactly how money is being spent, and they allow for easy adjustment to a project’s total price if changes are needed. However, unit pricing contracts can be time-consuming to create, since they are very detailed.

Contact Our DuPage County Commercial Real Estate Attorneys

At Stock, Carlson & Duff, LLC, our attorneys are highly experienced in construction contracts and other commercial real estate concerns. Whether you are a developer or a builder, we can help you draft a contract that will meet your needs, and we can work with you to resolve any contract disputes either inside or outside the courtroom. Contact our Wheaton construction contract lawyers today at 630-665-2500.

Sources:

https://www.thebalancesmb.com/common-types-of-construction-contracts-844483

https://www.stovallconstructioninc.com/news/types-commercial-construction-contracts/

What You Should Know About Probate in Illinois

IL probate lawyer, IL estate planning attorneyWhen someone dies without a will, or when heirs wish to determine the validity of a will, the decedent’s estate goes through a process known as probate. Probate can be a long and daunting process, and it may even be the source of stress when there are arguments about the estate, but understanding how it works can go a long way in helping you through the process.

Executor or Estate Administrator

During the probate process, an estate executor or administrator manages both the deceased’s assets and debts. If there is a will, this person is usually already named in the will. In the absence of a will, the court will appoint an executor (generally the closest family member). Named executors can decline their duties if they are unwilling or unable to fulfill them.

Creditors and Probate

Heirs are not the only ones that come forward during probate; creditors may also file claims to pursue unpaid debts. By law, they must do so within the fixed time period allotted to them. In addition, the IRS must be paid any and all income taxes due. All debts and taxes must still be paid prior to the distribution of any remaining assets or funds of assets. In addition, an income tax return must be filed for any assets that earn income during the probate period.

Inclusion and Exclusion of Assets

While many assets will go through probate, not all must be taken through this process. Those that do require probate typically include:

  • Assets held only in the name of the deceased
  • Jewelry, furniture, art, and any other assets that are not registered or included in the will
  • Any portion of assets held as common property with other parties.

Assets that are typically excluded from probate include:

  • Assets held in a living trust
  • Assets with already named beneficiaries, such as IRAs and life insurance policies
  • Bank account or credit union assets in which the deceased was a trustee for another party
  • Assets held in joint tenancy
  • Any assets registered in the name of the deceased as “transfer on death” or “payable on death” to another party

Speak With a Wheaton Probate Attorney

Dealing with probate and the death of a loved one is difficult enough without the added stress of family squabbles, will contests, and other related considerations. The good news is that we are here to help. Contact an experienced DuPage County estate administration lawyer at Stock, Carlson & Duff LLC to get the guidance you need. Call 630-665-2500 to schedule a confidential consultation with a member of our team today.

 

Source:

https://www.ilga.gov/legislation/ilcs/ilcs5.asp?ActID=2104&ChapterID=60

 

How to Develop a Successful Business Idea

IL business attorney, Illinois business lawyerMost of us, at some point or another, have had those fleeting thoughts about a product or service that could serve as the foundation for a new business. On the other hand, maybe you have watched another company offer goods and services while knowing that you could do it better. So how does one go from the “idea” phase to the “action” phase of starting the actual business based on the idea? There are, of course, many steps, but the first important one is to determine whether or not the idea is truly marketable.

What Is Your Idea?

Not every business idea is going to grow into the next Microsoft or Google, and that is okay. A successful service or product is not necessarily going to break records or reshape the world as we know it. In order to be profitable, your idea simply needs to solve some type of problem for those you intend to reach.

With that in mind, you need to think about what your idea actually is. Is it a physical item that you intend to manufacture and sell? Is it an improvement on an existing product? Or perhaps, it is a service that you expect to provide for your clients in exchange for payment. No matter what you have in mind, a clear understanding of the idea is critical.

Learn as Much as You Can

Before you launch your business, you will need to research the viability of your idea and how it might fit into the current economic landscape. For some people, industry reports and formal market research studies are appropriate, but it is important to look at more than numbers. You should also talk extensively with friends, family members, and trusted business associates regarding your idea. Be sure to look beyond the friendly and supportive comments and to hear what they are saying about whether they would spend money on your idea. If you want a forum with fewer personal entanglements, there are thousands of message boards and other resources available online where entrepreneurs from all over the world discuss ideas and share their perspectives.

Keep Yourself Organized

By its very nature, an idea is nebulous, and even if you have jotted down a few notes, there are many factors that you will need to consider as you take your idea from a concept to a business plan. As early as you can in the planning process, starting writing things down. Make a list of potential advantages and disadvantages, and keep track of any challenges or opportunities that arise along the way. These records will serve as the basis of your business plan, even if you need to put the idea on hold for a time and you decide to come back to it later.

Work With a Wheaton Business Lawyer

If you have a possible idea for a new business, it is never too early to speak with an experienced DuPage County business law attorney from Stock, Carlson & Duff LLC. Our team will provide the guidance you need and help you build your new venture from the ground up. Call 630-665-2500 for a confidential consultation today.

 

Sources:

http://www.entrepreneur.com/article/225513

https://www.forbes.com/sites/forbesbusinesscouncil/2019/10/30/nine-ways-to-figure-out-if-you-have-a-winning-business-idea/