Men who love building are their own undoers,
and need no other enemies
Marcus Crassus (Plutarch, Lives: Marcus
Crassus, Chapter 2, Section 5.)

When Plutarch wrote about the lives of famous Romans nearly 2000 years ago the allure and perils of construction were already apparent. Many an aristocrat blew the budget building his palace. We can imagine all too clearly the financial chaos that resulted to the contractors and suppliers.

2000 years later there is still allure and peril in construction. Hopefully, however, we have gotten smarter about managing the risks. The Romans invented a species of mechanic's lien to protect the right to payment. We borrowed the idea in the United States and Canada 200 years ago, but every generation seems to have to learn a portion of the lessons over again through experience. Tuition is high in the school of hard knocks, and the pace of our modern world demands a steep learning curve.

I based this short book on columns I wrote for Finance and Commerce; a legal and business newspaper in Minneapolis; Business Credit magazine, published by the National Association of Credit Management, other seminar materials and the experience I gained from many years of work with clients in the construction industry. It is my intention to encourage strategic use of mechanic's lien and surety bond rights to do better business and collect more receivables. This is not intended as a treatise for lawyers, but rather as a tool to contribute to improve business practices for the people on the front line in the construction industry.

Contractors, subcontractors and suppliers are the first tier financiers of building construction. They shoulder far more risk than they may realize.

A construction project is a pyramid. The owner is at the top. At the bottom are the laborers who build the project then wait until payday for a check. Each tier of our pyramid extends credit to the tier above until the owner makes a draw on the construction mortgage. As that mortgage money flows back down the pyramid it is really "take out" financing for the credit the tiers have extended. In this environment it is not enough to be a good tradesman. You have to run a business too. This means coming to grips with the real costs, and the risks that go with financing construction. You must think more like a banker would as you approach any construction project. This booklet introduces the job-based credit strategy as a way to do just that.

Interested?

We want to share these ideas with you. If you will e-mail us your request, we will forward a current edition of the book to you in PDF format for your personal use. We also gladly consider your comments and suggestions for further refinement and improvement of this resource. Please use our Contact Us feature.

Thank you.

Contact the office of James K. Sander, PA  for assistance with your construction law, commercial collections and alternative dispute resolution cases today.  We offer FREE initial phone consultations and evening and weekend appointments are available by request.

The office of James K. Sander, PA, located in Golden Valley, Minnesota, provides experienced legal counsel to residents of Minnesota and western Wisconsin. 
In Minnesota: Hennepin, Ramsey, Dakota, Scott, Anoka, Washington and Sherburne counties including Minneapolis-St. Paul, Mankato, Winona, Rochester, Moorhead, Alexandria, St. Cloud, Duluth and the entire Twin Cities Metro area. 
In western Wisconsin: Polk, Pierce and St. Croix counties including St. Croix Falls, Somerset, River Falls, Prescott, Ellsworth, Osceola and Dresser.

James K. Sander, PA
4050 Olson Memorial Highway • Suite 195
Golden Valley, MN • 55422
Phone: 763.521.4503 • Fax: 763.521.4505 • E-mail: Contact Us

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