Construction Contract Contractor Owner The Construction Site

Transcription

1 Construction Contract This agreement is made on the date written above our signatures between Contractor Name: (Contractor) and Owner Name: (Owner). Contractor Contractor Name: Address Address City, State: Zip: Work Phone Number: Cell Phone Number: Fax Number: Address: License Number: Contractor Name: will be referred to as Contractor throughout this agreement. Owner Owner Name: Address: Address: City:, State: Zip: Day Phone Number: Cell Phone Number: Fax Number: Address: Owner Name: will be referred to as Owner throughout this agreement. The Construction Site Address: Address: City:, Hawaii Zip: Page 1

2 I. Project Description A. For a price identified below, Contractor agrees to complete remodeling work (identified as the Project in this agreement) for Owner. B. The Project is described as follows: Description of the work, materials and equipment to be installed: II. Contract Price A. In addition to any other charges specified in this agreement, Owner agrees to pay Contractor $ for completing the Work described as the Project. III. Scheduled Start of Construction A. Work under this agreement will begin on / /. IV. Scheduled Completion of Construction A. Work under this agreement will be Substantially Complete within Calendar Days after the date construction begins. V. Documents Incorporated A. This agreement incorporates by reference certain disclosures and notices required by federal and state law. The following documents are incorporated as though included in full as part of this agreement. Notice Required by Hawaii Revised Statutes Section Notice Required by Hawaii Revised Statutes Sections and Notice of Right to Cancel under Regulation Z (in quadruplicate) VI. Scope of Work A. Contractor shall supervise and direct the Work and accepts responsibility for construction means, methods, techniques, sequences and procedures required to complete the Project in compliance with the Contract Documents. B. Except for materials expressly designated otherwise in the Contract Documents, Contractor warrants that all materials and equipment furnished under this contract shall be of good quality and new. VII. Cutting and Patching A. The color, texture and planes between existing and new materials might not match exactly. Contractor will use due diligence to create the best match possible. Owner acknowledges that patched surfaces may be detectable when construction is complete. VIII. Compliance with Law A. Contractor and Owner mutually commit to use reasonable care to meet the Requirements of state, federal and local Law when discharging their responsibilities under this agreement. IX. Owner's Responsibilities A. Owner shall have sole responsibility to secure financing for the Project and shall pay all fees, charges, or other costs of such financing, including Inspection fees charged by any lender. The nonperformance of any lender shall not affect the obligation of Owner to Contractor. Owner hereby Page 2

3 authorizes and directs any lender on the Project to furnish Contractor with full information on undisbursed loan proceeds when requested by Contractor. B. Owner will not interfere with or permit others to interfere with, stop, hinder, or delay completion of the Work by Contractor or Subcontractors except as provided under this agreement. X. Representations by Contractor A. Owner has reported to Contractor all conditions known to Owner which may not be apparent to Contractor and which might significantly increase cost of the Work or delay completion. These concealed conditions include, but are not limited to, hazards on the Job Site, unsuitable soil conditions, prior Defective Work of others, latent Defects in the Plans or Specifications, earlier attempts to do Similar or related Work, and obligations imposed by government. XI. Disclaimer by Owner, Reliance by Contractor A. Owner has provided Contractor with information on subsurface or concealed conditions at the Job Site. Except to the extent that Contractor knows this information to be false, Contractor is entitled to rely on the accuracy of this information. XII. Payment Plan A. Owner will pay to Contractor the Contract Price in 2 installments, an initial payment and a final payment on completion of the Work. XIII. Initial Payment A. Upon execution of this agreement, Owner shall pay to Contractor $ as an advance on the Contract Price. B. Except as otherwise provided in this agreement, Contractor may retain $ from the initial payment as a non-refundable deposit if this contract is terminated for any reason other than default by Contractor. XIV. Interest A. Payments due and not paid under the Contract Documents shall bear interest from the date payment is due at the rate of percent per month. B. Payments due and not paid under the Contract Documents shall bear interest from the date payment is due at a monthly rate of percent. C. When payment is withheld pending settlement of a bona fide dispute on the quantity, quality, or timeliness of the Work, interest shall accrue only on the amount ultimately paid. D. Payment of interest does not abrogate or replace any other rights Contractor may have under this agreement. XV. Final Payment A. Contractor will submit an application for final payment to Owner when the Work has been completed in compliance with the Contract Documents. If Owner agrees that Work has been completed, payment is due Contractor for the entire unpaid balance of the contract amount (including any Retainage). B. Except as provided otherwise in this agreement, Owner shall pay the amount due within 3 calendar days after approval of any application for initial or final payment. Page 3

4 C. Making of final payment constitutes waiver of all Claims by Owner against Contractor except those Claims previously made in writing and delivered to Contractor and those obligations otherwise provided by this agreement or by operation of Law. D. The acceptance of final payment by Contractor shall constitute a release by Contractor of known Claims against Owner arising out of this contract except those Claims which (1) Have been made in writing and identified by Contractor as not having been settled at that time, or (2) Are based on fraud or misconduct by Owner. E. If completion of the Work is delayed unreasonably at no fault of Contractor, Contractor shall be entitled to final payment for all Work completed (including Retainage) without prejudice to the right of Contractor to complete the Project at a later date and without prejudice to the right of Owner to make Claims against Contractor for Defects in Work completed. Hawaii's Contractor Repair Act CHAPTER 672E-11 OF THE HAWAII REVISED STATUTES CONTAINS IMPORTANT REQUIREMENTS YOU MUST FOLLOW BEFORE YOU MAY FILE A LAWSUIT OR OTHER ACTION FOR DEFECTIVE CONSTRUCTION AGAINST THE CONTRACTOR WHO DESIGNED, REPAIRED, OR CONSTRUCTED YOUR HOME OR FACILITY. NINETY DAYS BEFORE YOU FILE YOUR LAWSUIT OR OTHER ACTION, YOU MUST SERVE ON THE CONTRACTOR A WRITTEN NOTICE OF ANY CONSTRUCTION CONDITIONS YOU ALLEGE ARE DEFECTIVE. UNDER THE LAW, A CONTRACTOR HAS THE OPPORTUNITY TO MAKE AN OFFER TO REPAIR AND/OR PAY FOR THE DEFECTS. YOU ARE NOT OBLIGATED TO ACCEPT ANY OFFER MADE BY A CONTRACTOR. THERE ARE STRICT DEADLINES AND PROCEDURES UNDER THE LAW, AND FAILURE TO FOLLOW THEM MAY NEGATIVELY AFFECT YOUR ABILITY TO FILE A LAWSUIT OR OTHER ACTION. XVI. Arbitration A. Any controversy or Claim arising out of or relating to this contract or contract warranty or the breach thereof which cannot be resolved by mediations shall be settled by arbitration administered by the American Arbitration Association under its Construction Industry Arbitration Rules, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. 1. Any controversy or Claim arising out of or relating to this contract or contract warranty or the breach thereof or a Change Order or addendum to this contract which cannot be resolved by mediations shall be settled by arbitration administered by the American Arbitration Association under its Construction Industry Arbitration Rules, and judgment on the award rendered by the arbitrator(s) may be entered in any court having jurisdiction thereof. B. Contractor and Owner agree to include in each contract for construction or design services on the Project a clause which requires that disputes under that contract be settled by arbitration administered by the American Arbitration Association under its Construction Industry Arbitration Rules. C. Any representative of Owner or consultant to Owner or Contractor or any Subcontractor to Contractor on the Project shall have the same rights in any arbitration proceeding as are afforded by arbitration rules to Contractor and Owner. If more than one demand for arbitration is made by a Party with respect to the Project, all such Claims shall be consolidated into a single arbitration unless the Parties otherwise agree in writing. D. Anything in this contract notwithstanding, any Claim arising out of or relating to the Contract Documents or warranty or the breach thereof may, at the option of the Claimant, be filed in any Small Claims Court having jurisdiction, in lieu of an arbitration proceeding. Page 4

5 XVII. Insurance A. General Requirements 1. Contractor shall carry workers' compensation insurance and public liability insurance as required by Law and regulation for the protection of Contractor and Owner during progress of the Work. Page 5

6 Signatures This contract is for immediate acceptance. Any delay in acceptance beyond / / will require renegotiation of the terms of this agreement. This agreement is entered into as of the date written below. Owner Name:, Owner (Signature) (Printed Name) (Signature) (Printed Name) (Date) (Date) Contractor Name:, Contractor (Signature) (Printed Name and Title) (Date) Page 6

7 Notice Required by Hawaii Revised Statutes Section Under Hawaii law, anyone not paid for labor or materials furnished for home construction or improvement may file a lien against the property. This lien is an obligation like a mortgage and may have to be paid off before the property is sold. A subcontractor or material supplier who has not been paid by your general contractor is entitled to file a lien on your property even if you've paid the general contractor in full. To protect yourself from liens, you can require your contractor to include with each invoice a written lien release from everyone with lien rights on the work done. When the job is finished, either you or your contractor should publish a notice of completion in the newspaper. Forty-five days after publication, no liens can be filed on your property. If you don't publish a notice of completion, liens are permitted for a full year after completion. To protect yourself, consider delaying the final payment until forty-five days after notice of completion is published. You can also request a performance or payment bond. A bond is like an insurance policy and will add 5 percent or more to your construction cost. For that price, the bonding company will guarantee completion of the work and will guarantee that everyone with lien rights is paid in full. Unless a bond is required in the contract, there will be no bond on this project. Homeowners Take Notice Any person who furnishes labor (prime or subcontractor) or materials (material supplier) for your home improvement or renovation project and is not paid can file a claim (lien) in Circuit Court against your property under Hawaii Revised Statutes ("HRS") chapter 507. This is true even if you have paid the contract price in full to the prime contractor and the contractor fails to pay his subcontractors or material suppliers. In order to obtain a lien against your property, a contractor, subcontractor, or material supplier must go to court and show that goods or services for the project have been supplied but not been paid for. You will be notified to appear and defend against these claims in court. If a lien is obtained, you are entitled to prove in a later court proceeding that you paid your prime contractor in full. The court could then enter judgment in your favor against the prime contractor and direct payment out of the contractor's recovery fund up to the amount allowed by law, if the prime contractor was properly licensed at the time you entered into the contract with the prime contractor. What You Can Do Here is what you can do to help prevent problems: 1. Make certain that the contractor is licensed. Call to verify licensure. 2. On bigger jobs, ask the contractor to explain to you about the possibility of providing a performance and payment bond which will guarantee completion of the project and payment of all liens. This bond is usually provided by surety companies or material supply houses to qualified contractors. It may cost you approximately 5 percent of the project cost. 3. You should not make any oral agreements. Make sure everything is put in writing, including but not limited to the price, what work is to be done, any specific exclusions or restrictions, and the grade and brand of materials to be used, the length of the project, etc. See HRS Section and the rules of the Contractors License Board. If you later agree to make any changes in the original specifications. These changes should be in writing as well. 4. Take time to study the agreement. Do not let a contractor or salesman hurry you into signing a contract; especially when you feel pressured by emergencies. 5. Remember, a contract is a legal, binding document. Make certain you understand the contract. If not, spend a few extra dollars to have an attorney explain it to you. 6. Obtain a lien release from subcontractors. A mechanic's lien could be placed on your home by a subcontractor if the general contractor fails to pay his bills - even though you have paid for the work. Page 7

8 The same thing holds true for suppliers of construction materials incorporated into your job. Get a lien release! Contractors could provide you with a lien release form. This form will essentially state that you have paid or have entered into an agreement to pay the subcontractor or supplier for their work, and that the subcontractor or supplier therefor relinquishes their lien rights. 7. Do not approve plans or blueprints unless you understand them. 8. Please be sure your checks are made out to the contractor. Not to a salesman. 9. Make sure and publish a "Notice of Completion" in the newspaper as soon as the work is done. No lien may be claimed 46 days after the notice requirement (among other things) is completed in accordance with HRS Section Discuss with your contractor the possibility of withholding a portion of payment until the 45-day period for filing liens has expired. The amount withheld should be sufficient to cover all claims which might be filed. You and your contractor must agree on the amount. 11. If you have any questions about lien rights or other contract matters, do not sign this or any contract. Review HRS chapter 507 and/or contact an attorney first. This form has been approved by the Contractors License Board; however, the Board suggests that a person become familiar with the laws and rules governing contractor's and mechanic's liens prior to entering into a contract with a contractor for new construction or improvements. I (we) have discussed with the contractor the lien rights of those who will be supplying labor or materials to my (our) project as well as steps I (we) can take to reduce our lien liability. That discussion included the following information: "Under Hawaii law, anyone not paid for labor or materials furnished for home construction or improvement may file a lien against the property. This lien is an obligation like a mortgage and may have to be paid off before the property is sold. A subcontractor or material supplier who has not been paid by a general contractor is entitled to file a lien on my property even if I've paid the general contractor in full. To protect myself from liens, I can require my contractor to include with each invoice a written lien release from everyone with lien rights on the work done. When the job is finished, I should be sure that a notice of completion is published in the newspaper. Forty-five days after publication, no liens can be filed on my property. If I don't publish a notice of completion, liens are permitted for a full year after completion. To protect myself, I could delay the final payment until fortyfive days after notice of completion is published. I could also request a performance or payment bond. A bond is like an insurance policy and will add 5 percent or more to my construction cost. For that price, the bonding company will guarantee completion of the work and will guarantee that everyone with lien rights is paid in full. Unless a bond is required in the contract, there will be no bond on this project." I (we) have read and understand this Disclosure of Lien Rights and Bonding options. (Date) (Owner's signature) (Owner's signature) (Contractor's signature) Page 8

9 Notice Required by Hawaii Revised Statutes Section and In compliance with Code of Hawaii Rules, Section and Section , Owner and Contractor confirm that: 1. Contractor has made full disclosure to Owner of all relevant information which might mislead Owner, including details on performance of this contract and lien rights. 2. The scope of the work has been identified in detail in the Contract Documents. 3. Except as specifically provided in this contract, Contractor is not bonded. Except as specifically provided in this contract, Owner has agreed that neither performance nor Payment Bonds will be required. Owner has received adequate assurance of financial security of Contractor and is satisfied that Contractor has the resources required to complete the Project to the satisfaction of Owner. 4. The name and address of Contractor appear elsewhere in this agreement. The license classification of Contractor is. The license number of Contractor is. 5. Except as specifically provided elsewhere in this agreement, Contractor makes no warranty, express or implied (including warranty of fitness for purpose, merchantability, habitability or workmanlike construction). 6. The cost of Work to be performed is identified elsewhere in this agreement. 7. The lien rights of Contractors, subcontractors and Material Suppliers have been explained elsewhere in this agreement. 8. The approximate percentage of Work to be subcontracted on the Project is. 9. The names and license numbers of all Subcontractors are listed below. 10. A clear statement of the risk of loss of any payments made to a sales representative is printed in distinct capital letters below. (Date) (Owner's signature) (Owner's signature) (Contractor's signature) Page 9

10 NOTICE OF RIGHT TO CANCEL UNDER REGULATION Z (12 CFR (b) requires that each owner receive two copies of this notice.) To: Owner Re: Your right to cancel Project You are entering into a transaction that will result in a security interest being placed on your home. You have a legal right under federal law to cancel this transaction, without cost, within three business days from whichever of the following events occurs last: (1) The date of the transaction, which is _, or (2) The date you receive your Truth in Lending disclosures, or (3) The date you receive this notice of your right to cancel. If you cancel this transaction, the security interest is also cancelled. Within 20 calendar days after we receive your notice, we must take the steps necessary to reflect the fact that the security interest on your home has been cancelled, and we must return to you any money or property you have given us or to anyone else in connection with this transaction. You may keep any money or property we have given you until we have done the things mentioned above, but you must then offer to return the money or property. If it is impractical or unfair for you to return the property, you must offer its reasonable value. You may offer to return the property at your home or at the location of the property. Money must be returned to the address below. If we do not take possession of the money or property within 20 calendar days of your offer, you may keep it without further obligation. How to cancel: If you decide to cancel this transaction, you may do so by notifying us in writing at: Contractor Name: Address Address City, State: Zip: You may use any written statement that is signed and dated by you and states your intention to cancel, or you may use this notice by dating and signing below. Keep one copy of this notice because it contains important information about your rights. If you cancel by mail or telegram, you must send the notice no later than midnight of (midnight of the third business day following the latest of the three events listed above). If you send or deliver your written notice to cancel some other way, it must be delivered to the above address no later than that time. I WISH TO CANCEL. Signature Date See the next page for important information about what happens if this agreement is cancelled. Page 10

11 Notice Required by 12 Code of Federal Regulation Section (d), Effects of Rescission (1) When a consumer rescinds a transaction, the security interest giving rise to the right of rescission becomes void, and the consumer shall not be liable for any amount, including any finance charge. (2) Within 20 calendar days after receipt of a notice of rescission, the creditor shall return any money or property that has been given to anyone in connection with the transaction and shall take any action necessary to reflect the termination of the security interest. (3) If the creditor has delivered any money or property, the consumer may retain possession until the creditor has met its obligation under paragraph (d)(2) of this section. When the creditor has complied with that paragraph, the consumer shall tender the money or property to the creditor or, where the latter would be impracticable or inequitable, tender its reasonable value. At the consumer's option, tender of property may be made at the location of the property or at the consumer's residence. Tender of money must be made at the creditor's designated place of business. If the creditor does not take possession of the money or property within 20 calendar days after the consumer's tender, the consumer may keep it without further obligation. Page 11

12 NOTICE OF RIGHT TO CANCEL UNDER REGULATION Z (12 CFR (b) requires that each owner receive two copies of this notice.) To: Owner Re: Your right to cancel Project You are entering into a transaction that will result in a security interest being placed on your home. You have a legal right under federal law to cancel this transaction, without cost, within three business days from whichever of the following events occurs last: (1) The date of the transaction, which is _, or (2) The date you receive your Truth in Lending disclosures, or (3) The date you receive this notice of your right to cancel. If you cancel this transaction, the security interest is also cancelled. Within 20 calendar days after we receive your notice, we must take the steps necessary to reflect the fact that the security interest on your home has been cancelled, and we must return to you any money or property you have given us or to anyone else in connection with this transaction. You may keep any money or property we have given you until we have done the things mentioned above, but you must then offer to return the money or property. If it is impractical or unfair for you to return the property, you must offer its reasonable value. You may offer to return the property at your home or at the location of the property. Money must be returned to the address below. If we do not take possession of the money or property within 20 calendar days of your offer, you may keep it without further obligation. How to cancel: If you decide to cancel this transaction, you may do so by notifying us in writing at: Contractor Name: Address Address City, State: Zip: You may use any written statement that is signed and dated by you and states your intention to cancel, or you may use this notice by dating and signing below. Keep one copy of this notice because it contains important information about your rights. If you cancel by mail or telegram, you must send the notice no later than midnight of (midnight of the third business day following the latest of the three events listed above). If you send or deliver your written notice to cancel some other way, it must be delivered to the above address no later than that time. I WISH TO CANCEL. Signature Date See the next page for important information about what happens if this agreement is cancelled. Page 12

13 Notice Required by 12 Code of Federal Regulation Section (d), Effects of Rescission (1) When a consumer rescinds a transaction, the security interest giving rise to the right of rescission becomes void, and the consumer shall not be liable for any amount, including any finance charge. (2) Within 20 calendar days after receipt of a notice of rescission, the creditor shall return any money or property that has been given to anyone in connection with the transaction and shall take any action necessary to reflect the termination of the security interest. (3) If the creditor has delivered any money or property, the consumer may retain possession until the creditor has met its obligation under paragraph (d)(2) of this section. When the creditor has complied with that paragraph, the consumer shall tender the money or property to the creditor or, where the latter would be impracticable or inequitable, tender its reasonable value. At the consumer's option, tender of property may be made at the location of the property or at the consumer's residence. Tender of money must be made at the creditor's designated place of business. If the creditor does not take possession of the money or property within 20 calendar days after the consumer's tender, the consumer may keep it without further obligation. Page 13

14 Today's Date Job Address Job Address City, ST, ZIP Contractor Change Order Agreement Original contract date Original contract price $ Sum of previous changes $ Cost of this change $ Revised contract price $ Description of this change A. Material and supplies cost: $ B. Taxes and fees $ C. Direct labor: $ D. Indirect labor costs: $ E. Equipment and tools: $ F. Subtotal:... $ G. Overhead at % of line F: $ H. Subcontracts: $ I. Overhead at % of line H: $ J. Subtotal:... $ K. Profit at % of lines F and J: $ L. Subtotal:... $ M. Total cost, lines F, J and L: [ ] Add [ ] Deduct $ N. Items specifically excluded from this change: Q. This proposal is valid for days. R. We require days extension of the contract time. [ ] We are proceeding with this work per your authorization. [ ] Please return a signed copy of this agreement as your acknowledgment of this change. This Change Order incorporates by reference the terms and conditions of the original contract and all change orders approved prior to the acceptance of this agreement. This Change Order is accepted by Date Page 14