Tips For Florida Contractors When Facing Default Termination Allegations

Claims for default termination are probably one of the worst-case scenarios you may face as a Florida contractor, but there is a good chance that you will encounter disputes at some point. Because of the harsh consequences of canceling, Florida construction laws and most contracts include provisions on notice and opportunity to cure. This provides the general contractor, subs, and lower tier parties to correct the errors before the termination can be effective. What you do with this opportunity is the critical point.

As such, a solid strategy is essential when curing a default to avoid termination. You need to develop a solid, efficient plan to keep the project on track, and you can rely on a Florida default terminations attorney to guide you. In addition, this list of action items can help Florida contractors when facing default termination allegations.

Document and Respond 

Upon receipt of a threat or formal notice of termination for default, carefully review the allegations and thoroughly investigate each one. You will need to document all relevant information, as you will work with your attorney to formulate a response. It is important to reply in writing to:

• Dispute any inaccurate statements;
• Supply proof that contradicts the claimant’s allegations; and,
• Offer additional support for your position.

Invoke Cure Rights

 Following the legal requirements of the Florida statute or provisions in the construction contract, communicate your intent to correct any defaults. If the notice of termination includes claims that have merit, make sure to include your understanding of the problem and provide a meticulous plan of action to cure. However, you should consult with your lawyer when invoking cure rights to ensure the allegations of default are legitimate. 

Deal in Good Faith 

By demonstrating your commitment to making things right, you send the message that you intend to comply with your contractual obligations. Examples of good faith might include:

• Assigning workers to overtime;
• Agreeing to work on weekends or off-hours when appropriate;
• Expediting supplies and materials; and,
• Re-working equipment schedules. 

There are certainly expenses associated with these tactics, but the costs could far outweigh the losses of default termination.

Stay in Touch with the Surety: If you are the principal on a performance bond for the construction project, the surety will be entitled to notice when a party claims default. Reach out to the company right away and offer whatever cooperation might be requested. You should also reassure the surety that you have a plan for the threatened termination, so the company does not pursue you.

Speak to Our Florida Construction Lawyers About Default Terminations

These and other tips can help you protect your interests in a default termination situation, and you also support the efforts of your attorneys. At Linkhorst & Hockin, P.A., it is our goal to help you find efficient solutions that protect your business interests. To learn how our team can assist with default terminations, please contact us to schedule a consultation. Florida contractors in Palm Beach County and Southern Florida can call 561-626-8880 or go online to reach our Jupiter, FL offices.

Source:

leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&URL=0500-0599/0558/0558.html