Building & Remodeling
What must be written in your construction contracts
Home improvement contractor complaints have held the number one slot in Department of Consumer Protection’s list of bad boys for many years. Not surprisingly, our state legislators have reacted to provide additional safeguards for their electorate. Both home improvement contractors (remodelers) and new home contractors have to be registered with the state in order to practice legally. There are eight specific requirements in the statutes that make a contract legal. I will use the statute regarding home improvement as it affects a greater number of consumers.
Each contract must be (1) in writing, (2) signed by the owner and the contractor, (3) contains the entire agreement between the owner and the contractor, (4) contains the date of the transaction, (5) contains the name and address of the contractor, (6) contains a notice of the owner’s cancellation rights (you have a three day right of cancellation) (7) contains a starting date and completion date, and (8) is entered into by a registered salesman or registered contractor. Each change in the terms and conditions of a contract shall be in writing and shall be signed by the owner and contractor.
Now let’s move onto the practical part of number three above. This is the description of what will be done and what materials are to be used and cannot ever be specific enough for me. If you are having wood floors installed, the contract should not say only “wood floors”. What species of wood? What width, how is it is installed and finished? If the Owner is to purchase some part of the remodeling or addition puzzle, these items should be written specifically into the contract.
A start and completion date is required on the contract! That does not mean “I start in about three weeks, and finish… ummm, when I’m done” These are real calendar dates folks! I admit that I am honest with my clients and add a week or two on the end for “just in case”. But this is all up front with my clients and written with their knowledge and consent.
Did you notice that “Change orders” didn’t deserve a number? It would have been number nine. Although specifically spelled out in the Statute, it only got a mention and not one of the required eight to make a contract. Change orders are generally the source of most of the disagreements between owners and contractors. If you are reading this as an owner or contractor, I strongly advise you to require that ALL change orders are in writing and signed by both parties. This is what you get in addition to the contract, for this amount of money. Sign here and we both get a written copy. This is also a good place to spell out what this change will do to the schedule. End the potential disagreement about “I thought you said…” I’ve done some Expert Witness case review and testimony in court, generally against bad boy contractors. This item deserves its own number!