Scope and price regime
A lump-sum contract shifts quantity risk to the builder; under unit prices, the risk stays with the client. Mixing the regimes without clarity is a source of disputes.
Construction companies · works contracts
Construction contracts: how to structure the contract, change orders and measurements to avoid disputes
Most construction disputes arise from unformalized change orders, contested measurements and extended deadlines without a record. The contract must define how each of those situations is documented.
Straight answer: which clauses prevent disputes in construction contracts
The decisive clauses are: definition of the contract regime (lump sum, unit price or cost plus) and of what is included in the scope; a written change-order procedure for extra services and design changes; measurement criteria, payment terms and retention limits; rules for extending the deadline due to events beyond the builder's control; penalties with a cap and a method of calculation; provisional and final acceptance procedures; and liability for defects, with the five-year warranty for soundness and safety under article 618 of the Brazilian Civil Code.
This page is for construction companies, contractors, developers, subcontractors and engineers responsible for public or private works contracts in Brazil. We serve companies throughout the State of São Paulo, Brazil, with meetings at our Paulista or Tatuapé offices or by video call, and act before the São Paulo courts (TJSP), the labor courts (TRT-2, TRT-15), the federal court (TRF-3) and administrative bodies.
Points of attention from contract to handover
Change orders and extras
Work done without a formal change order is hard to bill. The contract must provide for a written work order and a deadline for the client to respond.
Measurements and retentions
Objective measurement criteria and approval deadlines prevent late payment. Retentions must have a percentage, purpose and release date.
Deadline and delays
Rain, design changes and client delays extend the deadline if they are recorded in the site diary and formally communicated.
Acceptance and defects
Provisional acceptance with a punch list and final acceptance after correction. Apparent defects have short deadlines; soundness and safety, five years.
Subcontractors and liability
Subsidiary or joint labor liability, documentation requirements and retention of amounts to cover charges.
What usually turns into litigation
Verbal change orders
The client asks for a change, the builder executes it, and payment is refused for lack of formalization. A written work order solves it.
Incomplete site diary
Without daily records of weather, crew and events, the deadline extension cannot be proven and the delay penalty applies.
Retention without a release date
Percentages held 'until the end of the warranty' with no date stay unpaid for years. Deadlines and conditions must be written.
How the advisory works
1. Contract structuring
Drafting or review focused on scope, change orders, measurements, deadlines and warranties.
2. Monitoring execution
Templates for work orders, notices and records that preserve the builder's rights during the work.
3. Disputes
Negotiation, mediation, arbitration or litigation over payments, delays, penalties and defects.
Every relevant communication with the client must be in writing and kept with a date. Messaging apps count, but email or a receipted letter weighs more in a dispute.
Frequently asked questions about construction contracts
How long is the builder liable for defects?
For soundness and safety, five years from handover, under article 618 of the Brazilian Civil Code. Apparent defects must be reported within shorter periods, and there are specific deadlines when the client is a consumer.
Can the client apply a delay penalty without notice?
It depends on the contract. As a rule the penalty requires proven default, and delays caused by the client or by unforeseeable events may exclude it, if documented.
Can extra work be billed without a signed change order?
It is possible but difficult. The client's request, execution and value must be proven through emails, the site diary and witnesses. A written change order avoids that discussion.
Official references and related pages
Brazilian rules of reference for construction contracts. Actual clauses depend on the contract regime and the type of client.
Construction contract under negotiation or in dispute?
Send the contract and the measurement history through the secure channel. The screening identifies the critical points and the applicable steps.