Stopping work on a project is the toughest call to make for a contractor and its attorney. If you are wrong, you are in breach of the contract.  This usually means that you are paying rather than collecting. The first step is to determine whether you have a right to stop work.

If you have not been paid for providing labor, services or materials on a construction job, you generally have the right to suspend your performance.  Your right to suspend performance may be described in your contract; if not, it will be determined under general principles of contract law. The first step in deciding whether you may properly stop work following nonpayment is to review your contract for the terms applicable to a non-payment situation.  The terms of the contract will control. 

A stop work provision is extremely valuable to the contractor or subcontractor ...

This bill makes a number of changes to Florida Statute 255.05 which governs bonds on public construction projects and Chapter 713 which covers construction liens and bonds for private construction work.

The purpose of the type of contract provision is to bring another document into the contract without fully setting forth the incorporated document. It places "hidden" obligations in your contract. Since these clauses are enforced by the Florida courts, the old saw "ignorance is bliss" is an invitation to disaster.

Acceleration of a contractor's performance may arise in two situations. The first situation occurs when a specific order is issued under the express contract to complete the project prior to the originally scheduled completion date.

• Ensure that owner has recorded and posted Notice of Commencement prior to starting work or delivering materials;
• Record Claim of Lien in the county where the property is located within 90 days of final furnishing of labor, services or materials;
• Serve copy of Claim of lien on owner either before or within 15 days of recording;
• Contractors only - serve Final Contractor's Affidavit at least five days before filing suit;
• File suit within one year of recording the Claim of Lien.

The Supreme Court recently issued a ruling which will impact all contractors doing business with public bodies. In County of Brevard v. Miorelli Engineering, Inc., the Court dealt with a situation where the County contracted with Miorelli to build a spring training facility for the Florida Marlins. After work had commenced on the facility, the County terminated the contract and withheld amounts due to the contractor. Miorelli sued the County, asserting a variety of claims, including a claim for extra work.

Arbitration is often referred to as an alternative to litigation. However, they share the same fundamental premise. A third party is responsible for deciding any dispute. In arbitration, the parties present their dispute to an impartial arbitrator who will make a binding decision on the parties. Arbitration takes place as a result of an agreement in the contract between the parties requiring disputes to be submitted to arbitration. Parties may also agree to arbitration after a dispute arises even in the absence of a contract provision.

Negotiation and Mediation are the least costly ways to reach an agreement. Here's how to make them work.