Wednesday, July 27, 2016

Sample Renovation Contract

Here is an example of a renovation contract that may be used with your contractors:

Renovation Contract


Project address:

1. Contract Documents
        X         (a) This Contract form
      X           (b) Estimates attached and/or referenced herein (if any)
      NA       (c) Specifications attached and/or referenced herein (if any)
       NA      (d) Additional documents signed by both parties during the course of this Contract. Extras and deletions to be documented on a Change Order Form and signed by both parties.
       NA      (e) Other:                                                                                                                       
Omissions in the Contract Documents and any work requested in variance to the Contract Documents are considered extra to the Contract and are not included in the Contract Price. Any additional work, required due to site conditions known to the Owner and not disclosed to the Contractor, or which could not be reasonably anticipated by the Contractor, are not included in the Contract Price and shall be extra to the Contract Price.

2. Description of Work
Unless otherwise stated, the Contractor agrees to supply all materials, labor and supervision to perform the Work as (choose one):
               Described below
    X         Described in the attached Work Schedule/Estimate

a. The Work entails the following:  
See attached Estimate
b. The Work does NOT include the following:
c. Permits
Work will be undertaken under the following permits which will be provided and paid for by the Contractor as designated below.
(check any that apply)
(i) Zoning variance                                  
(ii) Demolition permit                                                                            
(iii) Building permit                                 
(iv) Electrical permit                                               
(v) Plumbing permit                                               
(vi) Other    Septic permit for back deck over reserve drainfield         
Any such permit obtained by the Contractor will be conveyed to the Owner within 30 days of receipt by the Contractor.
The following parties (specify Contractor or Owner) will contact the appropriate authorities for inspections:            X           Contractor                       Owner

d. Subcontractors
The Contractor will use the following subcontractors during the performance of the Work as listed below (company name and service provided):
Contractors employees only unless otherwise notified to Owner in writing
Nothing contained in the Contract Documents is intended to, nor shall it, create any contractual relation between the Owner and any subcontractors. The Contractor agrees that it is responsible for the enforcement of all material provisions of all subcontracts.

3. Timing
Work to commence on or before (date)                                                               
Business Days for completion:                                                  
Full Completion on or before (date) ___________________________

Full Completion means that the Work has been completed to 100% of the agreed work, and that the property will be “resale ready or “rental ready” as agreed.
The Contractor agrees to pay a per diem penalty of $   50.00       /day for any non-exusable delays beyond the Full Completion date.
 All time limits stated in this Contract are of the essence. Notwithstanding the foregoing, any delay in Full Completion of the Work (as the case may be) in accordance with the Contract Documents will be considered an excusable delay if arising from causes beyond the Contractor’s control and not reasonably foreseeable by the Contractor with the use of the Contractor’s best professional efforts. Excusable delays include but are not limited to such events as labor disputes, unavailability of materials, delays in obtaining a permit, fire, natural disaster, unfavorable weather conditions, delays (other than delays arising out of Contractor’s breach of this Contract) by, or breach by any subcontractors; or any delay by Owner of processing proposed changes, delays resulting from inaccuracies in information provided by the Owner, or delays resulting from the request to perform tasks described in section 2b.
In the event of the occurrence of an excusable delay, Owner shall grant appropriate extensions to cover such periods of delays in writing to Contractor. Owner shall have no obligation to grant extensions if delays were not excusable delays, or otherwise resulted, directly or indirectly, from the Contractor’s breach of this Contract. Where a delay occurs, the Contractor must inform the Owner at the earliest possible date of such occurrence, the reason for the delay and anticipated amended dates of completion.
The Contractor and Owner agree that should the Contractor not be able to commence the Work within
    5       days from the commencement date specified in this Section, due to causes beyond the Contractor’s control such as inability to obtain a building permit, then the Owner may cancel the Contract on written notice mailed to or delivered to the address of the other party shown in this Contract. The Contractor’s liability to the Owner shall be limited to the refund of any monies paid by the Owner to the Contractor, less any costs incurred by the Owner in related to the execution of this agreement.

4. Terms of Payment
The Contract price is to be calculated as a fixed cost of   $________________  including all taxes.
Payment shall be due and payable as outlined in the Payment Schedule. A percentage of the fixed fee shall be paid on the presentation of each billing and shall be proportionate to the percentage of work completed for that billing period.

5. Payment Schedule
The Owner will make payments to the Contractor as follows:
Project Deposit of           50  % for the amount of $_________________________
Additional installment of                              NA  % in the amount of $              NA          upon the completion of:                                              NA                                                                         
Final payment upon completion of work and inspection and acceptance by Owner.
All payments must be made to the Contractor. Any payment to a subcontractor is not deemed a payment to the Contractor.
6. Changes in Work
The Owner may make changes by altering, adding to, or deducting from the Work, with the Contract and Contract Price being adjusted accordingly. Changes to the Work require a written Change Order Form, signed by both the Owner and the Contractor.

a) Extras will be calculated in the following manner (check one):
1) ___ Material cost plus hourly rate of $                                             
2) ___ Labor and material cost plus          %
3) _X_ A lump sum to be agreed on in advance by both parties.

Extras are payable upon (check one):
1) ___ Signing the Change Order
2) _X_ Invoicing pursuant to the Change Order
3) ___ Completion of work specified in Change Order less___% holdback in all cases.

b) Deletions will be calculated on an actual cost basis, to be deducted from the relevant or next scheduled payment.

7. Utilities and Washroom Facilities
The Contractor and the Owner agree that responsibility for the provision of utilities and facilities to meet work and worker requirements will be assumed in the following manner:

Owner                                  Contractor
(a) Water                             __X__                                   _____
(b) Electricity                      __ X__                                                 _____
(c) Gas/Oil Heat                                __ NA_                                                 _____
(d) Other

8. Standards of Work
The Contractor agrees to supply all labor, materials and supervision to complete the Work in accordance with the Contract Documents.
The Contractor agrees to undertake all Work diligently in a good and workmanlike manner, in accordance with good quality residential standards and practices, and in compliance with any applicable Building Code and all other authorities having jurisdiction.
The Owner accepts that there may be inconveniences from time to time, and the Contractor agrees to keep such inconveniences to a reasonable minimum. It is the responsibility of the Owner to take reasonable steps to provide a work area free of household obstructions, and to remove or protect household items in areas where it may be reasonably anticipated by the Owner that they may be subject to dust, damage or vibrations.
The Contractor agrees to keep the site orderly and reasonably free of debris. At the completion of the project, the Contractor shall clean the property and leave it fit for use. All equipment, materials, rubbish and similar material incidental to the project shall be removed by the Contractor.

9. Warranty
The Contractor shall correct, at its’ own expense, any defects in the Work due to faulty materials and/or workmanship pursuant to this Contract for a period  of  3 months             from the date of Full Completion.
The Owner shall give the Contractor written notice of such defects within a reasonable time, and in any event within the warranty period.
The Contractor will convey to Owner any warranties by manufacturers or suppliers on individual materials, products or systems supplied by Contractor under this Contract.
The Contractor does not warrant labor and/or materials supplied by the Owner or the Owner’s subcontractors. The Contractor shall protect the Work, the Owner’s property and the property of third parties from damage occasioned by the performance of its obligations under the Contract Documents.

10. Insurance
Prior to commencing the Work, the Contractor agrees to provide, maintain and pay for insurance during the time the Work is being performed, including commercial general liability in the minimum amount of $1,000,000 against claims for damages for personal injury or property damage by reason of anything done or not done by the Contractor, its employees or agents, in connection with the performance of this Contract. The Contractor will also provide proof of automobile liability insurance. The Contractor is responsible for all materials on site provided by the Contractor for the Work in this Contract until installed.
11. Compliance with Workers' Compensation and Other Laws
The Contractor agrees to provide evidence of compliance by the Contractor’s own company and any of the Contractor’s subcontractors with all requirements for registration and payments due under the province’s workers’ compensation statute as requested by Owner.
The Contractor also agrees to comply with all laws, ordinances, rules, regulations, codes and orders in force during the performance of the Contract which relate to the preservation of public health or construction safety.

12. Other Contractors
Owner reserves the right to let separate contracts in connection with the Work or to do certain work by Owner’s own forces as specified in Description of Work.

13. Dispute Resolution
The Owner and the Contractor agree that in the event of a dispute as to the interpretation of this Contract or the extent of the Work, the issues shall be submitted to arbitration as agreed to by both parties or under the Washington State arbitration rules.

14. Default by Owner
In the event that (a) the Owner does not perform its obligations under this Contract in accordance with the terms of this Contract and has not corrected the default within _10_ days of written notice by the Contractor, or (b) the Owner becomes bankrupt or makes a general assignment for the benefit of its creditors, or if a receiver of the Owner is appointed, or (c) if the Work is stopped as a result of a court order, then the Contractor may cease work and treat the contract as repudiated forthwith on the occurrence of such default. In such event, an accounting shall be made between the Owner and the Contractor, and the Contractor shall be entitled to payment for such parts of the Work as are completed at the time of default.

15. Default by Contractor
In the event that (a) the Contractor does not perform the Work in accordance with the terms of this Contract and has not corrected the default within _10_ days of written notice by the Owner, or (b) the Contractor becomes bankrupt or makes a general assignment for the benefit of its creditors, or if a receiver of the Contractor is appointed, then the Owner may finish the Work in accordance with the plans and specifications as the Owner may deem expedient, but without undue delay or expense. In such event, the Contractor shall not be entitled to any further payment under this Contract.
16. Signs
The Owner agrees to permit the Contractor to display a sign on the project site until completion, in accordance with local and state ordinances.
This Contract shall not be assigned, in whole or in part, without the prior written consent of the other party, which consent will not be unreasonably withheld or delayed.
This Contract shall be governed by and construed under the laws of the state of Washington, and supercedes all prior communications and agreements. There are no other terms outside of this Contract.
The Contractor assures that there is not now any claim, action, contract, rule or other circumstance which may interfere with the Contractor’s ability to perform its obligations under this contract.

Owner Signature                                                              Date
Owner Name
Contractor  Signature                                                     Date
Contractor  Name

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