Contracts and Change Orders

Shandy Heil, Skinner, Patricia  |  1/3/2007 9:43:40 AM

Require a written contract with the contractor’s license number on it and do not sign it until you understand all of its terms. A set of sample forms and agreements are provided here to help eliminate confusion.

Contract Essentials

A contract is a promise or set of promises for which the law gives a remedy in case of breach, or the law in some way recognizes performance as a duty. If money or other considerations change hands before the entire contract is completed, signed receipts should change hands.

Contract Elements
Agreement The offer and acceptance to do specific things in a specific manner. State clearly, simply and completely all that is to be done. If beginning and finishing dates are involved, state them in the body of the contract. A good item to include in a contract for home rebuilding is that materials and procedures used will be those provided for in minimum standards of the current building code. 
Guarantees Include what is guaranteed and for how long. Also include who is responsible for the guarantee (contractor, dealer or manufacturer).
Permits State who is responsible for obtaining and paying for any required building permits. Parties.
Parties Parties involved must be at least 18 years of age and mentally competent (not insane, retarded or suffering mental problems of aging). All parties must sign the contract.
For a consideration Something of value changes hands, usually money. The amount to be paid and schedule of payments should be included in the contract. That schedule should be based on progress toward completion, not on the passage of time. Exercise your right to inspect all work or to hire someone to inspect the work for you.
Change Orders The contract should specify procedures to be used to change the original work order.
Other items
to include
The maximum construction cost and schedule of payments, penalties and allowances; how you will handle unavoidable delays; circumstances under which payment can be withheld; insurance requirements and provisions for termination of the contract.

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