Key Takeaways

• Construction contracts define payment terms, allocate risk, and establish responsibilities to prevent disputes.
• Cost-plus contracts offer flexibility for uncertain scopes but require oversight to control escalating costs.
• Fixed-price contracts provide budget certainty when project details are clearly defined.
• Unit price and time-and-materials contracts promote fairness when quantities or scope may change.
• Design-build and guaranteed maximum price models balance efficiency, accountability, and cost control.