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Contractor Contracts


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Tiffany's Forum Posts: 12

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By Tiffany in Conway, AR on 10/16/2007


Thought these might be useful to some of you. I used them with my contractors and it has saved my A$$! I hired a bad foundation guy who really screwed up. If I hadn't had this contract in place, I'd be out $50K at the minimum (what it cost to fix his mistakes)! Some subs will balk at being asked to sign... if that's the case, DON'T USE THEM. This is designed to PROTECT YOU. There are two contracts that are used together. The first is the "Contractor Agreement", which protects you against liabilities, taxes, unemployment, etc. The second is the "Work Authorization" and is geared more toward your property. Since I can't attach these as word documents, I'll copy & paste them... so I apologize in advance for any formatting issues that might arise. Also note the Contractor Invoice area and Scope of Work within the Work Authorization. These will be tailored to your agreement with your subcontractor.  I generally keep two versions - one for staged worked (shown below) and one for a lump sum payment that is received only AFTER inspection is approved and work is completed.

Subcontractor Agreement

 

Name of Contractor:_________________________________________________

Corporation      (YES)     (NO)    Sole Proprietorship      (YES)     (NO)      Other: __________________

Type of Work: ________________________________________________________

Name of Owners: ________________________________________________________

And/Or Officers: ________________________________________________________

Home Address: ____________________________________________ Home Phone: _____________

Business Address: __________________________________________ Business Phone: ___________

Insurance Company (Workman’s Compensation): ___________________________________________

Policy Number: _______________ Agency: _____________________ Phone Number: ___________

 

 

THIS AGREEMENT, together with the Price List attached hereto, signed by the parties hereto, shall constitute the agreement between [Homeowner name] (The [Homeowner]) and the undersigned (Contractor) in accordance with the following:

 

1.      The work to be performed hereunder is generally described as:

 

2.      Attached hereto as part of this Agreement, Contractor has submitted a signed “Price List”, approved by the [Homeowner], which shall be modified only by a written Amended Price List. The “Price List” will include all anticipated and expected work. “Hidden Charges” will not be paid. The “Price List” will include all work related to the completion of the related “Checklist”. Contractor shall provide the [Homeowner] with a specific “Job Detail Sheet” if requested.

 

3.  In conjunction with this Agreement, the [Homeowner] will issue a Work Authorization, covering the work to be performed, or various phases of the work to be performed on the job.

 

4.      If the work is to be performed in stages, the Price List shall include progress payments for each stage. The [Homeowner] will issue a payment schedule for each stage to be detailed in the Work Authorization.

 

5.      Contractor shall perform all labor in a workmanlike manner, according to the standard practice, and warrants that all labor done and any materials furnished by the Contractor will meet or exceed FHA minimum property standards, VA requirements, and any applicable city-building-municipal code requirement.

 

6.      Contractor further warrants all labor and materials furnished by him to be free of defect for a period of at least one year from the date payment for said work. Contractor agrees to make all repairs and correct such defects under the warranty within 8 hours of such notice of such defect in an emergency and within 48 hours of notice of such defect on a non-emergency basis. The [Homeowner] shall determine the emergency

 

7.      Contractor shall schedule all work under each Work Authorization to the requirements of the [Homeowner]. Changes to the construction schedule must be documented and approved by a Change Order.  Project Delays relating to written changes in requirements or design, weather; or unavailability of material shall be considered Excusable Delays.

 

8.     All labor and materials furnished by the Contractor shall be in accordance with the plans and specifications by the [Homeowner] and the Contractor shall keep a copy of such plans on the job while the work is in progress.


9.      Contractor shall clean the job site upon completion of each stage covered by the Work Authorization, removing all of the Contractor’s materials, and if materials are furnished by the [Homeowner], Contractor shall move all usable material to a location designated by the [Homeowner]. All clean-up refuse shall be placed in receptacles or locations provided or designated by the [Homeowner].

 

10.  Contractor shall furnish all warranties and/or guarantees by manufacturer on appliances and equipment and shall further furnish all certificates required by any municipality and/or VA and/or FHA.

 

11.  Contractor, in performance of the work covered hereby, is an independent contractor and shall have the sole discretion in the performance of such work, save and except that the same must be performed in accordance with the plans and specifications and the contract agreements.

 

12.  Contractor agrees to furnish certificates of insurance covering Workman’s Compensation with limits not less than state statutory requirements and public liability with limits of not less than $1,000,000.

 

13.  Contractor shall be solely responsible for withholding taxes, social security taxes, and State unemployment taxes.

 

14.  Contractor agrees to comply with the requirements of the Occupational Safety and Health Act and hereby releases the [Homeowner] of any liability of whatsoever nature because of Contractor’s employee (or agents) injuries or negligence.

 

15.  Contractor expressly agrees to indemnify the [Homeowner] against all loss, damage, or claim of whatsoever nature, arising out of the performance of the work by Contractor, including injuries to persons and/or property and including costs of Court and reasonable attorney’s fees.

 

16.  Contractor shall continuously perform the work designated under the contract agreement, and in the event Contractor shall not substantially perform in a continuous manner and if Contractor shall fail to do so for three (3) consecutive days under any Work Authorization, the [Homeowner] shall have the right to give three (3) days written notice to Contractor and shall be entitled to terminate the employment of Contractor and declare Contractor in breach of this Agreement.

 

17.  In the event of breach of contract by Contractor, the [Homeowner] shall be entitled to retain ALL sums due Contractor under any Work Authorization, and shall be entitled to cause the work to be performed by others, and shall apply any sums then due Contractor against such costs of completion and thereafter to the costs of one (1) year warranty, and after all warranties have expired, any excess shall be paid to Contractor.  In the event costs of such completion result in a deficiency, Contractor shall be fully responsible for the deficiency, together with any damages, costs of Court, and reasonable attorney’s fees incurred by the [Homeowner].

 

18.  At all times during the performance of this Agreement, the [Homeowner] shall be entitled to hold, of all work in progress, statutory sums in accordance with the laws of the State. Contractor waives his right to constitutional and statutory liens on any job not fully performed by Contractor.

 

19.  All notices to be sent to Contractor shall be sent to the address shown above.

 

20.  Contractor agrees to exercise all reasonable precautions to avoid causing any damage to materials or equipment located or installed by others or to work performed by others on the job site. Contractor further agrees to be liable for any such damages caused by himself and his employees as a result of negligence or failure to exercise precautions.

 

21.  Contractor agrees that he is acquainted with and will instruct his employees in the Construction Safety Requirements of the Occupational Safety and Health Act of 1970, and the Construction Safety Act of 1969. Further, he agrees that his employees will comply with the provisions of these acts and that he will be financially liable for any fines imposed on the said Contractor for violations of these provisions on account of unsafe acts by his employees. The same applies to work sublet by the said Contractor, agents, and materialmen.  The Contractor shall have in his possession at all times MSDS (Material Safety Data Sheets), and shall provide the [Homeowner] with copies thereof.

 

22.  This Agreement, the approved Price List attached hereto, the plans and specifications, and the individual Work Authorization issued on each job shall constitute the entire Agreement, and there are no other agreements, oral or written, by and between the parties hereto.

 

23.  The [Homeowner] agree to pay sums for each stage of the works as set forth on the “Price List” approved by the [Homeowner] and as further set forth on each Work Authorization issued on each job, or portion thereof.

 

24.  This agreement shall remain in full force until terminated in writing: however, anything herein contained to the contrary notwithstanding, the work to be performed by Contractor shall include only such work as if finally issued on work authorizations by the [Homeowner] to Contractor.

 

25. Contractor shall provide the [Homeowner] with a list of all subcontractors and suppliers he will use on the job. This list will be required PRIOR to starting any work on the job. A Lien Release will be required from the Contractor, his subcontractors, and his suppliers PRIOR to each payment.

 

 

 

 

 

EXECUTED THIS THE ______ DAY OF ________________, 20____

 

 

 

 

______________________________      ______________________________

Authorized Signer for the [Homeowner]                         Contractor Signature

 

 

 

 

WORK AUTHORIZATION

 

Name of Contractor:__________________________________________________

Name of Owners: ___________________________________________________________

Business Address: ___________________________________________ Business Phone: ___________

Insurance Company (Workman’s Compensation): ___________________________________________

Policy Number: _______________ Agency: _______________________ Phone Number: ___________


 

Subcontractor:_____________________________________ is hereby authorized to perform the designated work outlined below.

 

Description of work: ___________________________________________________________

The Contractor shall become familiar with details of work in the field and shall advise the [Homeowner] of any discrepancy prior to performing any tasks. The Contractor shall acknowledge that he has investigated and satisfied himself as to all of the conditions affecting the work. Any failure by the Contractor to acquaint himself with the available information shall not relieve him from responsibility for estimating properly the difficulty or cost of successfully performing the requested work. The [Homeowner] assume no responsibility for any erroneous conclusions or misinterpretations made by the Contractor on the basis of the information made available by the [Homeowner].

Omissions from the design drawings or specifications detailing the work necessary to carry out the intent of this Agreement or which are customarily performed, shall not relieve the contractor from performing such omitted details of work. Notwithstanding the foregoing, the Contractor shall not be responsible for conditions that are concealed from sight, because they are below ground or concealed, provided the [Homeowner] did not notify the Contractor of such. In the event that such conditions are encountered, the [Homeowner] and the Contractor shall negotiate an equitable solution to the problem, following the Change Notice Procedure in section herein.

Basis of Payment: The Contractor will perform this work on the following basis:

 

__________________________________________________________

This Attachment SHALL NOT EXCEED $____________________ for all labor and material necessary to complete the required work as defined, and in accordance with the Contractor Agreement, all Attachments and Design Drawings.

Contractor Invoice:

The Contractor shall invoice the [Homeowner] in two billings, each upon completion of the work phase, and the [Homeowner] acceptance of all work as described herein. Payment of invoices by the [Homeowner] shall be made after all work has been properly inspected and has been accepted.

Scope of work:

Work shall be completed in phases with the first phase to include:

__________________________________________________________

The first phase work should take approximately ____ days to perform.  Work shall begin on ______________ and shall commence by ______________. 

Work in the second phase shall include:

_________________________________________________________

All modifications to the schedule resulting in a schedule change shall be only by mutual agreement between the Contractor and the [Homeowner]. As part of this Agreement and prior to commencement of work, the Contractor shall review and approve the [Homeowner] project schedule forecast detailing all design, material supply, construction, installation, testing and documentation activities for which the Contractor is responsible. This shall become the Project Schedule of Performance.  Any changes to the schedule shall be reviewed and approved, in writing, by the [Homeowner].

The Contractor shall be responsible to meet schedule milestones and completion time-frames. Delays shall not be permitted unless approved in writing in advance of the delay by the [Homeowner], and then only those defined as Excusable Delays in the Contractor Agreement shall be approved. The Contractor shall be responsible to make up for all schedule changes resulting in lost time that are the result of the Contractor's inability to plan or properly coordinate his work effort in accordance with the Project Schedule.  If the Contractor fails to meet the completion time-frame, the Contractor shall pay a penalty to the [Homeowner] of $100/day until work is completed or the cost required to hire another contractor to complete the work; determination of penalty to be decided by the [Homeowner].

Quality Control:

The Contractor shall provide quality control throughout the duration of the Project. The Contractor and the [Homeowner] shall conduct regular inspections of all construction and installation work under the control of the Contractor. The [Homeowner] shall generate punch lists, noting any and all deficiencies in the construction and installation of the system. A copy of these lists shall be provided to the Contractor's installation personnel. The punch lists shall be accompanied with action required statements. The Contractor shall ensure that all work is performed in accordance with standards set forth in the Contractor Agreement, this Work Authorization, all applicable documents, and any Change Orders. Prior to the [Homeowner] final acceptance of any portion of the design, construction, installation and/or a specific milestone, the Contractor shall ensure that all deficiencies, including those noted by the [Homeowner], are corrected.

Change Orders:

The [Homeowner], prior to proceeding, must approve changes that affect this Agreement and associated attachments and documents. Under no circumstances shall the verbal statement(s) be considered as binding. Justification for changes associated with cost increases or schedule delays, as appropriate, shall be required in. Action on the change or work affected by the change shall not be performed until written approval from the [Homeowner] is received. Any work performed by the Contractor on a Change Order without following the procedures outlined herein shall be at the risk and expense of the Contractor, and at no cost to the [Homeowner].

EXECUTED THIS THE ______ DAY OF ________________, 20____

 

 

 

 

______________________________      ______________________________

Authorized Signer for the [Homeowner]                         Contractor Signature


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By Mark in Provo, UT on 10/18/2007


Editor note:

    These docs have been placed in our Free Download Gallery for download in digital form.

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Douglas's Forum Posts: 21
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By Douglas in Sacramento, CA on 2/28/2008


Tiffany,

These contracts are definitely advantageous to the owner. I would be concerned that they put so much burden of responsibility on the sub that they either wouldn't want to sign or demand so much money up front to cover their risk. Did any of your subs balk at signing them? 

Thanks,

Doug


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