Glossary of Terms

Glossary of Business and Construction Law Terms


  • Arbitration:
    • A method of alternative dispute resolution (ADR) where parties submit their disputes to a neutral third party (arbitrator) for a binding decision, often used in construction contract disputes.


  • Bid Bond:
    • A type of surety bond submitted with a construction bid to guarantee that the bidder will enter into a contract if awarded the project.
  • Breach of Contract:
    • Occurs when one party fails to fulfill the obligations outlined in a contract without legal justification.


  • Change Order:
    • A written agreement that modifies the terms, scope, or price of a construction contract due to changes in project requirements.
  • Contractor:
    • An individual or company that agrees to perform specific construction work under the terms of a contract.
  • Corporate Governance:
    • The system of rules, practices, and processes by which a company is directed and controlled, often involving the relationship between shareholders, directors, and management.


  • Defect:
    • Any imperfection or problem in construction work that does not meet industry standards or the contract specifications.


  • Eminent Domain:
    • The government’s power to take private property for public use, typically with compensation to the property owner.


  • Force Majeure Clause:
    • A contract provision that excuses a party from performing their obligations in the event of unforeseeable circumstances, such as natural disasters or acts of God.


  • Intellectual Property:
    • Legal rights that protect creations of the mind, such as patents, trademarks, copyrights, and trade secrets.


  • Lien:
    • A legal claim against a property to secure payment for services or materials provided during a construction project.
  • Liquidated Damages:
    • A predetermined amount of money specified in a contract that a party must pay if they fail to meet certain obligations, often used to compensate for project delays.


  • Mediation:
    • A method of ADR where a neutral third party (mediator) assists disputing parties in reaching a voluntary settlement.
  • Merger and Acquisition (M&A):
    • The process of one company combining with another through various methods, including mergers, acquisitions, or takeovers.


  • Non-Disclosure Agreement (NDA):
    • A legally binding contract that establishes confidentiality obligations between parties, often used to protect sensitive business information.


  • Partnership Agreement:
    • A legally binding contract that outlines the terms and conditions governing a partnership, including profit sharing and decision-making processes.
  • Performance Bond:
    • A type of surety bond that guarantees a contractor will fulfill their contractual obligations and complete a construction project.
  • Plaintiff:
    • The party who initiates a lawsuit or legal action against another party (the defendant).


  • Real Estate Transaction:
    • The buying, selling, or transfer of real property, often involving contracts, deeds, and financing.


  • Securities Law:
    • The body of laws and regulations that govern the issuance and trading of securities, including stocks and bonds.
  • Subcontractor:
    • A company or individual hired by a general contractor to perform specific tasks or provide services within a larger construction project.
  • Substantial Completion:
    • The stage in a construction project when the work is nearly finished, allowing the owner to use the property for its intended purpose while some minor items may still need to be completed.


  • Title Insurance:
    • A type of insurance that protects property buyers and lenders from financial loss due to defects in the property’s title or ownership.


  • Zoning Regulations:
    • Local government ordinances that specify how land within a particular jurisdiction can be used, including zoning for residential, commercial, and industrial purposes.