Differences of Construction Contracts, Estimates & Proposals

Construction contracts are complicated structured legal documents that spell out the terms and conditions of an agreement between a construction contractor and an owner contracting for construction improvement services. There are many types of construction contracts available such as prewritten agreements and agreements that are specifically created by attorneys for each project situation.

Although we could write pages on construction contracts, the intent of this article is to share the relationship between estimates, proposals and construction contracts. Estimates, proposals and construction contracts are interconnected through a series of bid activities. They are independent documents that are interrelated with each other and sequentially support the construction bid award and legalize the authority of the general contracting process.

The relationship and definitions of these 3 documents is a topic that comes up quite often with homeowners who are trying to understand how their general contractor arrived at their bid and what tasks are included in the proposal and finally what are the terms and conditions of the construction contract.

The fact of the matter is that every Houston general contractor has their own style and method in preparing an estimate, proposal and construction contract, although there are some professional standards that do apply for the benefit of both owner and contractor. Read more…