What are the various types of contracts used in the construction industry?

In the construction industry, contracts are used to establish the legal requirements, rights, and responsibilities between the parties involved. In New Jersey, there are several different types of contracts that may be used. The most commonly used contract is the Standard American Institute of Architects (AIA) Agreement. This is a comprehensive document that is used for most large-scale projects and it outlines the obligations of the parties involved. It generally covers payment details, scope of work, materials, and the timeline of the project. Another type of contract that may be used is a Cost Plus Contract. This type of contract is often made between the owner and contractor, and it covers all costs associated with the project. The contractor sets their own price for the project, and the owner pays the contractor only when the project is completed. In addition to these two types of contracts, contractors may also use a Guaranteed Maximum Price (GMP) Contract. This type of contract outlines a maximum price that will be paid for the project, and it serves to protect the project budget from unforeseen costs. Finally, a Lump Sum Contract may also be used. In this type of contract, a fixed price is agreed upon by the parties involved and all costs associated with the project are included in that one payment. This type of contract is often used for small-scale projects. Overall, there are several different types of contracts that may be used in the construction industry. The type of contract used will depend on the size and scope of the project, and the needs of the parties involved.

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What are the various types of contracts used in the construction industry?

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