Oct 14

What Is A Cost Plus Agreement

The usual response I get is, “I don`t keep those kinds of folders” or “All I have are text messages.” Depending on the nature of the contractual dispute, the lack of specific records may not be that serious. However, if there is a dispute about a cost-plus contract, record keeping can become a central issue for both the owner and contractor, resulting in disputes and litigation. Many courts have held that the decision of the contractor and the owner to use a cost-plus construction contract creates an increased additional obligation to the owner, but does it create a fiduciary duty? Decisions are divided. If it`s difficult to quote for a job, a cost-plus contract can help. Since the cost is reimbursed at the time of ordering, a contractor doesn`t have to worry about an inaccurate or erroneous estimate ruining their margin on an order – it`s already built-in! Cost-plus contracts can be divided into four categories. . . .