Green Contractors: Contractual Claims

Liability Exposures for Green Contractors

Contractors and builders are at risk of contractual liability during green building. Liabilities in this area include:

     • Failure of green systems to perform throughout the expected lifetime

     • Failure of systems to reach promised level of LEED certification

     • Improper installation of green systems

     • Failure of the building to qualify for tax credits or meet loan or
     incentive program requirements

     • Failure to stay within the allotted budget or time restrains due to
     greater than anticipated costs of green building

In short, for anything that your company promises to a client via contract, you must be able to deliver. Because green technologies are still relatively new, they may not function as efficiently or for as long as you anticipate. Therefore, you open yourself up to the risk of being sued by building owners for breach of implied warranties of materials, workmanship and purpose.
Green building is a growing trend, as businesses want to do their part to help the environment while lowering energy costs at the same time. Plus, green building is becoming increasingly more difficult to avoid because federal, state and municipal governments are starting to mandate it for new residential and commercial construction.

Jumping into the green movement might seem like a lucrative and logical step for your business to take. Before you go green, educate yourself to avoid costly lawsuits and common liability exposures for those engaging in green construction.

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