Can the owner terminate a contractor before completing contractual obligations and perform final acceptance?
1 reply
Nov 2, 2019
This is going to be difficult to answer without seeing the terms within the construction contract itself. Most construction contracts have provisions governing each party's rights to terminate the contract, and what procedures/notices are involved in terminating.
For example, the AIA construction documents have a lot of different factors that go into the termination rights of each parties...and those factors even come down to which version of the AIA document is being used. The most recent version (2018) actually introduced some new wrinkles to contractor termination. Great article about this on Construction Executive here: AIA Analysis: New Construction Termination Considerations.
Generally speaking, if you are a contractor with a construction contract...then you have rights to what is promised in that contract. The owner and you, after all, have a contract. Each of you have rights and obligations in that agreement. There will be provisions within the contract that allows a party to terminate, but these provisions almost always require that the other party be "notified" of any defaults, and then they are given an "opportunity to cure" those defaults. If the party is notified properly, and doesn't cure the defaults, then they are at risk of losing the contract.
Since this will deal with the details of your construction contract, you should consult with a New York construction attorney to review your contract and give you some specific advice. A NY attorney I'd recommend is Vincent Pallaci.