In the construction industry, a project is only as strong as the people working on it. When a subcontractor fails to meet expectations — whether through subpar workmanship, missed deadlines or contract violations — their approach can result in costly delays and legal headaches.
If you are a Texas business owner dealing with an underperforming subcontractor, taking specific legal steps can help protect your investments and keep your projects on track.
What does your contract say?
The first step in addressing a subcontractor’s poor performance is to carefully review the contract that you have in place with them. Most construction agreements outline specific obligations, performance timelines and quality standards. If the subcontractor at issue is not meeting these terms, the contract may provide remedies, such as cure periods, financial penalties or termination clauses.
You should also examine any warranty provisions included in the contract, as many agreements require subcontractors to correct defective work at their own expense. If the contract includes dispute resolution clauses—such as mediation or arbitration—those may also dictate how the issue must be handled.
In many cases, businesses must give a subcontractor an opportunity to fix a concern before taking further action. A Notice to Cure is a formal written document outlining the deficiencies and providing a set time frame to correct them. If the subcontractor fails to respond or continues to perform inadequately, the business being impacted negatively may have grounds to terminate their agreement.
If the subcontractor refuses to comply, businesses may need to pursue legal action. Potential remedies under Texas law include:
- Breach of contract claims to recover damages for delays or substandard work
- Withholding payments for incomplete or defective work
- Termination of the contract under agreed-upon provisions
- Filing a claim against the subcontractor’s bond or insurance if applicable
Texas law also allows businesses to seek damages if a subcontractor’s failure results in financial losses or project delays. Seeking legal guidance can help to clarify the best way forward under your company’s unique circumstances.