Have you ever written a letter like this?
We have been in business for 20 years and never encountered the problems we have with this job. We are not saying we are perfect, and we know that some of the delays and mistakes were from our own work, but we took care of them, even when damages to the installation were done by the mason…”
Too often, the first letter you write on a difficult job is triggered by anger, especially if you are not getting paid or are being backcharged by the owner. So you send something like the above note.
What is wrong with this letter? What harm have you done to yourself? How will the other person perceive your words, and how will they be used against you?
The legal ramifications of the first letter can be large. It is a contemporaneous expression of facts and opinions and, as such, is given great weight by courts in deciding who is right or wrong. In the example above, the electrical contractor has the accomplished the following:
1. He has made admissions or statements that can be used against him. There is the admission of delays being caused by him, of mistakes being made by him and that he knows, by saying “we are not perfect,” that he thought his company could have done better.
2. He has opened himself up to the imposition of delay damages, such as liquidated damages, for delays he admitted causing.
3. He has told the owner that some of his problems were caused by another subcontractor, which means the owner may not be liable for them.
4. He may have lost credibility by claiming that the problems were highly unusual, when they probably were not.
5. And, finally, there is a whiny tone, which is very off-putting
None of these negative byproducts were necessary. This article will outline tips and suggestions for getting your information across without overly exposing you to pitfalls in contract law.
The first sentence defines the book
People who are not used to letter writing often struggle over the opening line. As a result, the first sentence tends to be very general and even petulant. Once that statement is written, however, the next sentence naturally follows, and the route you are traveling may not lead you to a good place.
Ask yourself why you are writing the letter. If your goal makes sense, write that idea. If not, do not.
Delete your favorite sentences
The history of your company is seldom a necessary element to a message that there are unpaid extras. Your sense of fairness and the other side’s lack of it, similarly, is not a recommended approach to telling an owner that you are not in default. In other words, you certainly can think about all the things you would love to tell the other side. But, then delete those phrases and stick to the point you are trying to make.
The rhetorical question
Letters are more serious than telephone calls, and the exact words used last longer. Use them to date facts and to notify the receiving party what you are planning to do. Do not waste space by saying things like “Why are you doing this to me?” or “Do you really believe we would intentionally purchase the wrong equipment?”
If you are angry when you draft such rhetorical questions, you will be angrier when you get the reply you invited.
It is OK to make demands
Contracts place obligations on both parties. When one party is not fulfilling its obligations, a demand letter can be appropriate. It is fine to be on record that “the light fixtures you were to provide have not arrived yet.” It is even better to add, “Please deliver the fixtures by next week.”
Avoid contractual terms of art
Most construction contracts require a degree of legal expertise to fully understand their terms. That kind of expertise probably is not the reason for your company’s success. Words such as “delay,” “disruption,” “acceleration,” “out-of-sequence work,” “stacking of trades,” “active interference” and “impossibility” for the most part are not a necessary part of your letter. Using them may create unexpected results and you may be misinterpreting what is really happening on your job.
The simple declarative sentence
State the facts. “We cannot complete rooms 101–152 for the following reasons... .” “Our invoice is 10 days past due.” “The laydown area you provided is flooded again.”
Describe what you want the other party to know about, without introduction or apology. It cannot be considered impolite to write a business letter in a businesslike manner.
Leave no letter unanswered
The absence of a reply can be considered by a court as an acknowledgment of the accuracy of the letter you received. Silence can be an affirmative statement. In addition, you may be conveying to the other party that you have no response, and that is the wrong message. In this regard, the correspondence accomplishes two things: It conveys facts and positions, and it establishes a written record.
Use facts that cannot be debated
Normally, the purpose of correspondence is not to annoy the other side. So avoid conjecture (“maybe you don’t care”) and accusation (“your supervision is incompetent”). Begin your letter with known, established facts that are relevant to the point you are making.
“Your schedule showed that the equipment room would be ready for our installation on Aug. 1. As of Aug. 15, that room remained under construction. Our crew cannot start.”
Do not make threats
There are dogs that bark and dogs that bite. In contract law, the bark (the threat) might itself be a breach of contract. The legal term is anticipatory repudiation. If you are going to stop work to force the other side into action, you had better be right in your facts and assumptions.
Segregate the topics
If you have a payment issue along with change orders awaiting approval, site interferences and other problems, send a separate letter for each major category. This procedure makes tracking the issues easier. It focuses each letter so that all relevant facts are noted, and it can help get the letter to the right person on the other side (accounting, management, scheduler, etc.).
The law concerning e-mails is still developing. However, for contract correspondence, write e-mails the same as you would letters. Instantaneous responses through your PC may act to bypass thoughtfulness and care. E-mails tend to be more off-handed and emotional than business letters, but they can have the same legal effects.
Do not quote the contract
In a parallel to the laws of physics, for each contract clause, there is an equal and opposite contract clause. By quoting the contract, you will only induce the other party to respond in kind. Even worse, when parties start thinking in terms of contract rights, reasonableness gets left behind.
Aggressiveness has its place, and there are times it is justified in letters. Remember, though, that every letter helps create the nature of the parties’ working relationship. So, do you want to keep the other side defensive, or do you want assistance? Do you simply want to convey information (a typical notice letter), or are you making a demand? In every instance, use simple declarative sentences and be polite.
Use these rules. They will improve your communication. EC