3 Successful Elements of a Construction Contract in Missouri
Aug 12 2025 On Behalf of David M. Duree & Associates, P.C. Construction Law
In Missouri, construction contracts define the relationship between a construction company and its customer. A well-drafted construction contract will have tailored provisions for the critical aspects of the agreement. Three of the most essential parts of a construction contract include the scope of work, payment terms, and dispute resolution.
Clear Scope of Work and Project Timeline
In a construction contract, the scope of work defines what the contractor must do or deliver to the client. A scope of work may specify the materials that the contractor will provide or use, the types of labor the contractor will employ, and the work the contractor will complete (e.g., installing electrical wiring, building an addition to a house, etc.). The scope of work should also include a project timeline that details milestones, including the specific tasks the contractor should complete by each milestone.
Having a clear scope of work and project timeline can help prevent confusion and disputes over what work the contractor must perform and when the contractor should complete the project. When disputes escalate to litigation, courts review the scope of work and project timeline outlined in the parties’ construction contract to determine whether the contractor performed as promised.
Detailed Payment Terms and Schedules
A construction contract should also include detailed language defining the payment structure for the project. Construction contracts often employ various payment structures, including lump-sum payments at the project’s completion, cost-plus payment terms, or milestone-based payments. Alternatively, contracts may include payment schedules that spread out the contract cost over a longer period. Clients may negotiate terms that allow them to retain a portion of the contract price until the contractor meets a specific contingency. Contracts may also impose penalties upon contractors who fail to meet project deadlines.
Detailed payment terms and schedules can help parties avoid cash flow issues during a construction contract and prevent disputes over what money the client owes and when the contractor should receive payment. However, construction contracts should also specifically address how change orders – which can change the scope of work – may affect the contract price, payment terms, and due dates. Otherwise, changes to the scope of work can lead to payment disputes.
Dispute Resolution and Termination Clauses
Many construction contracts include dispute resolution provisions that govern how the parties must resolve legal disputes arising from the agreement. For example, parties may agree to pursue mediation to resolve conflicts or submit claims to binding arbitration, as many arbitration services have procedures tailored explicitly to construction disputes. Having a dispute resolution provision in a contract can help parties avoid costly and time-consuming litigation.
When parties include dispute resolution or arbitration clauses in their contracts, they should consider drafting the provision with as broad a scope as possible to prevent litigation over whether a claim falls within the scope of the dispute resolution clause. For example, parties may incorporate a delegation clause that empowers an arbitrator to determine whether a specific claim falls within the scope of the parties’ arbitration agreement.
Construction contracts should also include terms governing the orderly termination of the parties’ relationship if either party needs to terminate the agreement. For example, a client may want to terminate a contractor due to slow or substandard work, or a contractor may want to stop working on a project because a client has missed payments.
Contact a Construction Law Attorney Today
When you negotiate a construction contract, having experienced legal counsel in your corner can help you protect your rights and interests. Contact David M. Duree and Associates, P.C., today for an initial consultation with a construction law attorney to learn more about the key aspects you should address in your construction contract.