How to Select A Contractor

Regardless of whether a project is a single-family residence or a private commercial structure, there is certain information which should be examined by an owner when soliciting a general contractor.

At the beginning it is fundamentally important that a design professional be engaged to prepare detailed construction drawings and specifications which accurately set forth the structural design that will fulfill the owner's intended use of the structure.

The owner should not place blind faith in the design professional and, upon completion of the contract drawings, it should develop a checklist of features it considers important and ensure that they have been placed in the specifications and incorporated on the contract drawings.

While the construction documents are being completed, the owner should begin compiling names of prospective general contractors that would be qualified to perform the intended work.

Potential information sources that can assist an owner in identifying qualified general contractors are the design professional, building industry groups, the California Contractors Association. (http://www.cslb.ca.gov)

An additional source of information would be other owners in the same business who have constructed similar structures.

Once a list of prospective general contractors has been identified, an Invitation to Bidders, together with a set of drawings and specifications, should be transmitted to those companies.

The contractors should be given at least two weeks for the preparation and submittal of competitive bids.

Upon receipt of the competitive bids, the owner, in consultation with its design professional, should review the prices submitted and select three contractors to interview for a potential contract award.

During the contractor interview process the following information should be reviewed:

1. Verify that the separate scopes of work in the drawings and specifications have been fully identified and priced.

2. Identify the major subcontractors each contractor plans to use. References for the major subcontractors should be solicited and verified.

3. Any question on timely material deliveries should be identified and alternative solutions discussed.

4. Financial viability of the contract should be examined--bank references, financial statements and furnishment of performance bond and labor and material payment bonds examined.

5. A list of comparable projects for the past five years should be requested and inquiries made of those project owners regarding the satisfaction and timely performance of the contractor.

6. Request a list of any non-personal injury litigations in which the contractor is currently involved, or has been involved, for the past three years with a written explanation concerning the facts surrounding each dispute.

7. Identify whether the contractor has identified any omission in the contract documents or whether it has suggestions for alternative systems or other cost-saving measures.

8. Request a list of personnel to be assigned and obtain a resume of their credentials as well as projects worked on over the past five years.

Upon completing the interview process and verifying the references provided, it is sometimes advisable to request a final and best proposal from the contractor finalists.

If not already made a part of the contract bid documents, once the contractor is selected the terms and conditions of contract, as well as any supplemental conditions that have been developed by legal counsel, need to be presented and negotiated between the parties.

The above process cannot guarantee that problems will not be encountered between the owner and general contractor during construction of the project, but it will serve to address issues that frequently are the subject of dispute before a project starts.