See if you can get a copy of the agreement that a big place like Home Depot uses.
It is my opinion that an experienced contractor will not be upset at a detailed agreement, having been out in the world and having heard what can and does go wrong.
You worked hard for the money you are paying for the work you want done, you have every right to protect your investment.
There are many contractors looking for work right now. You can courteously but firmly walk away from this one if he can't work with you to prepare an agreement that spells out the rights and obligations for both of you.
Again, rather than trying to reinvent the wheel, go to some large contractors and ask for a copy of the agreement form they use.

The first thing to determine is whether the contract will be for "Fixed Price" or "Cost of the Work with a Guaranteed Maximum Price".

The former requires that as much as possible be designed and documented at the time the contract is signed and offers reasonable cost control. The latter lets you continue to design the project as work begins but there is little cost protection, however, you can make changes more easily as the costs begin to be better understood.

Any Owner-Contractor Agreement should be fair to both parties. You may have worked hard for your money but the GC will be working hard for his money too.

You can add a contract clause that gives you the right to issue a "joint check" to the GC and a sub/supplier in the event that you believe the GC is close to insolvency or has stopped paying his subs/suppliers but you should not do that for all payments and if you did the GC would be justified in feeling insulted.

Unless there is a similar "joint check" clause in all of the GC-Sub contracts there could be difficulty getting the subs to accept a joint check if it was not in the right amount, did not pay them in full, or there was a good-faith contract dispute, etc.

A contract written by a contractor or a form from a construction organization will favor the interests of the GC sometimes to the detriment of the Owner (a Home Depot contract would probably be a good example of that) and one written by the Owner or Owner's agent will usually favor the Owner.

There are countless renovation contracts available on the internet but it is difficult to know which are fair to both parties. The best advice I can give you is to hire someone to draw the project and include at a minimum the location and type of lighting, finishes, counter detailing, etc. so the installation cost can be included in the contract instead of becoming part of the allowances. It is the allowances and other undocumented work that are the most likely to blow your budget and cause needless Owner-Contractor disputes.

FWIW, here's an article I wrote on contracts based on 4 interviews, a lawyer friend, 2 contractors and an architetct as well as some research/reading.

It's about contracts but attempts to show that knowledge of the remodeling process, hiring a good contractor with excellent references and communicating well are what will make for a good experience.

http://www.homeduover.com/Articles/Remodeling-Contracts/23

Bill, it's a nice gesture to offer contract advice to homeowners but you need to correct some of the information on your website.

1. You can require that a contractor inspect the documents and inform you of any errors that he finds but you cannot make him "responsible for having identified any errors in any of the documents" unless he is the author of those documents.

2. The "means and methods of construction" are the contractor's responsibility and the contract should contain no wording that shifts that responsibility to the Owner.

3. If "you pay all the costs for the job, materials and labor, and the contractor gets a fee for managing it all", he is called a Construction Manager. For a Cost of the Work Plus a Fee contract you would reimburse the general contractor for expenditures for the benefit of the project and also pay him a fee which can be fixed, a percentage of the Cost (markup), etc. Expense receipts must be submitted for payment of reimbursements regardless of how the fee is determined. A "maximum cost" is called a Guaranteed Maximum Price" and all costs above that amount are paid by the General Contractor.

4. By definition, the term "Time and Materials" means that there is no management fee or markup added to the cost of materials and the hourly labor rate.

5. Contractors rarely, if ever, use an AIA contract because they are written for projects where an architect will administrate the contract. When that is the case it is usually the architect who supplies the contract. These contracts are intended to protect both parties equally but most contractors feel they favor the Owner and compared to a contract written by a national contractor organization (often borrowing the AIA contract numbers) I would agree since these contracts strongly favor the contractor. If the contract form is not sold to you by the AIA, it is written by another organization and uses only the general format of the AIA forms. Avoid offerings that use terms like "AIA Style" or "AIA Format", etc. Also, AIA 101 is an Agreement form and it requires the use of the General Conditions form A201. These forms together are about 50 pages long and only allow for a Stipulated Sum and are far too complex and cover far too many issues to be used for a home construction project. For smaller projects you can use A107 (17 pages) which allows the payment to be based on either a stipulated sum or the cost of the work plus a fee (with or without a guaranteed maximum price). A105 (10 pages) is for residential projects and only allows for a Stipulated Sum. These two contract forms combine the Agreement and the General Conditions in one document. Conditions specific to the project would be attached as Special Conditions or Other Provisions.

6. In contracts, the use of "shall" in the second or third person is a command form intended to express that a provision is a mandatory and explicit obligation. The use of "will", "must" or "should" can be misconstrued.

"These contracts are intended to protect both parties equally"

They protect the architect more than any other party, owner or contractor.

Their main useful purpose is as a framework for very large new construction work to make sure everything gets addressed.
They are not especially useful for smaller jobs or remodel work in existing non-commercial buildings that may not have any drawing package for 'as built.'

Keep in mind that the more detailed you make a contract the fewer bidders you will get, an the more they are likely to charge.
ANY changes will also be at a significant cost, including items that cannot be determined before demolition starts.
i cannot tell you how any times I have even put warning \s in contracts about old plumbing and wiring that folks seem to breeze over until the walls are opened and the poor state of galvanized steel drain lines and ready to fail electric cables are then readily apparent.

At least for supply lines you can sometimes run multiple faucets an seethe flow restrictions at the outlets.

Old electric cables can often be damaged by the slightest disturbance during other needed work. Simply moving the cable can create short circuits in old hardened rubber insulation.

The older the structure the more money you will need as 'reserves' for the 'gotchas' tat only show up after work has started.

I will give my standard response to Brickeyee's standard claim about AIA Owner-Contractor contracts: an architect is named in the Owner-Contractor contract as the Owner's agent and any clause that appears to protect the architect is intended to protect the Owner. The Architect cannot be bound by any of the terms of the Owner-Contractor contract because he/she does not sign it. Instead, an Architect is only bound by the terms of the Owner-Architect contract which should not be of any concern to the Contractor.

I have already mentioned that AIA forms like A101 would not be appropriate for a home. I have collected contracts for 40 years and have found something missing in all of them otherwise I would just post some of them. Service Magic offers a sample contract but the selection boxes do not print and they forgot to mention the contract documents and other important issues. And they really favor the homeowner.

http://www.servicemagic.com/article.show.Sample-Contracts.13250.html

The Canadians are a lot smarter about this stuff but they can't spell labor and keep referring to the laws of provinces whatever they might be. (see below)

I always use one of the AIA small project forms even if I am asked to cross out some of the provisions including the duties of the architect. I always oversee a project to the end but I am not always asked to administrate the contract (ie formally oversee the payments, etc.). I use them simply because I understand the terms and formats and so do lawyers and judges. Containing commonly occurring terms in a General Conditions section and forcing exceptions to be listed in the Special or Supplementary Conditions prevents oversights, redundancies and misunderstandings. If nothing else AIA contracts make it clear that the contract is a jointly agreed upon national consensus document rather than something cobbled together by one side or the other. If you want to criticize the AIA for contract bias you must look at the AIA B-series Owner-Architect contract where their members have a stake. I have used them for large projects because they use the same terms as the matching Owner-Contractor forms but they are not appropriate for residential work.

The first step in finding a contract would be to search the internet for the home improvement laws for your state. In the past I have found completed copies of the A105 and A107 forms.

Warranties - AIA General Conditions often provide that in addition to any warranties provided by manufacturers, etc., and any special warranty required by the contract documents, the period during which the Contractor must correct deficiencies in the Work at the Owner's request is one year. This period is not specifically called a "warranty"; it simply extends the Contractor's broader responsibility for performance of the Work for one year after Substantial Completion. This period can be extended for as long as the parties are willing to agree without conflicts with state or manufacturer warranty requirements.

Lien releases - In AIA contracts for large projects, payments from the GC to the subs/suppliers are usually guaranteed by a Performance or Payment Bond. Since the cost of these bonds add to the cost of the work, they are not usually used in residential construction and therefore a clause may have to be added regarding lien releases.

Here is a link that might be useful: Canadian renovation contract form

Thanks for your input, Renno8, I'll look into your comments further. If you could provide a reference for points 1, 4 and 6, that'd be great. (Especially #1) The whole "shall" vs. "will" thing cracks me up; there seems to be much debate on the topic.

I'll ask my laywer about # 1 again.

Oh, I couldn't find in my document what your point #2 referred to.

It's difficult to be definitive about some of this stuff as each contract can be unique but still valid and as you point out, different states have different laws and there are regional differences in contract/business practices just like there are in construction techniques. I should make that clear in my document.

What's very cool about contracts is that they force people to consider what can go wrong in any endeavor, which gets them thinking deeply about the work itself and the human reactions to possible situations. They increase communication and understanding. To me, a detailed contract is like a detailed plan - work up front helps to eliminate problems later and when problems do occur, a course of action may already be in place, thanks to that up-front effort.

Still, all that stuff in my document, if included n a contract would be gong way overboard, IMHO, but it does serve to educate a homeowner a bit about the renno process. I agree with brickeye that a contractor would be quietly thinking, "High maintenence client - run!". I should make that clear too. I'd say to a homeowner, trust your contractor's glowing references and relax.

Issue #1, if the Owner supplies a set of design drawings, he is responsible for their accuracy and the author of the documents is responsible to the Owner under a separate contract. A Contractor cannot be held responsible for the content of the Owner's documents even if he is required to reviews them and make comments.

Here is what AIA document A107 says about this issue:

"8.1 REVIEW OF CONTRACT DOCUMENTS AND FIELD CONDITIONS BY CONTRACTOR
8.1.1 Since the Contract Documents are complementary, before starting each portion of the Work, the Contractor shall carefully study and compare the various Drawings and other Contract Documents relative to that portion of the Work, as well as the information furnished by the Owner pursuant to Subparagraph 7.1.1, shall take field measurements of any existing conditions related to that portion of the Work and shall observe any conditions at the site affecting it. These obligations are for the purpose of facilitating construction by the Contractor and are not for the purpose of discovering errors, omissions or inconsistencies in the Contract Documents; however, any errors, omissions or inconsistencies discovered by the Contractor shall be reported promptly to the Architect as a request for information.
8.1.2 Any design errors or omissions noted by the Contractor during this review shall be reported promptly to the Architect, but it is recognized that the Contractor's review is made in the Contractor's capacity as a contractor and not as a licensed design professional unless otherwise specifically provided in the Contract Documents.

Issue #2 was a response to your statement, "A contract will describe the work to be done, how it will be done ...". I realize you probably meant instructions regarding "how it will be done" would be limited to the specifications, quality standards, codes, etc. but others reading it might not realize that a contract should make it clear that "means and methods of construction" are solely the responsibility of the Contractor. This prevents the Owner and his agents from being held responsible for things over which only the Contractor has control.

Here's what AIA Document A107 says about the issue:

8.2 SUPERVISION AND CONSTRUCTION PROCEDURES
8.2.1 The Contractor shall supervise and direct the Work, using the Contractor's best skill and attention. The Contractor shall be solely responsible for and have control over construction means, methods, techniques, sequences and procedures, and for coordinating all portions of the Work under the Contract, unless the Contract Documents give other specific instructions concerning these matters. If the Contract Documents give specific instructions concerning construction means, methods, techniques, sequences or procedures, the Contractor shall be fully and solely responsible for the jobsite safety thereof ..."

Issue #4 - Federal Acquisition Regulation 16.601 Time-and-Materials contracts: A Time and Materials contract provides for acquiring supplies or services on the basis of (1) direct labor hours at specified fixed hourly rates that include wages, overhead, general and administrative expenses, and profit and (2) materials at cost, including, if appropriate, material handling costs as part of material costs.

The important distinction is that the contractor's compensation is based solely on the time x the fixed hourly rates. Actual material costs are reimbursed with no modifications. Hence the name: Time and Materials.

This contract type is only appropriate for small limited scope projects involving one or a few workers like a plumbing repair, etc.

Issue #6 - use of "shall" - see the link below. A gradual change in common usage does not mean that legal usage changes. When legal wording become standard it virtually never changes. This is not a conversation with the Contractor; the contractor knows well what these terms mean and why they are used even if homeowners find then archaic.

On the front page of A107 is the following statement "This document has important legal consequences. Consultation with an attorney is encouraged with respect to its completion or modification. State or local law may impose requirements on contracts for home improvements. If this document will be used for Work on the Owner's residence, the Owner should consult local authorities or an attorney to verify requirements applicable to this Agreement."

Here is a link that might be useful: legal use of

Bob, your efforts on behalf of homeowners is commendable but the most important feature of a construction contract is to provide clear divisions and limitations of responsibilities and duties of the parties involved. Unfortunately, the recommended contract wording on your website often does the opposite, implying or creating contract obligations for parties not signing the contract; implying or assigning responsibility to one party for work produced by the other; and making the Contractor responsible for contradictory requirements.

In my opinion, saying you are not a lawyer and only reporting information from interviews is not enough of a warning to homeowners. I have tried to explain some of the issues to you but it is simply too much to cover if you want verification references. You need to do your own due diligence or have a more experienced person review and correct the information or remove it.

"I will give my standard response to Brickeyee's standard claim about AIA Owner-Contractor contracts: an architect is named in the Owner-Contractor contract as the Owner's agent and any clause that appears to protect the architect is intended to protect the Owner."

Ad all they do us absolve the architect of any fudicial responsibility.

they are some of the most one sided contracts around, and miss a lot of things that should be included for work on residential jobs, especially old structures.

It appears brickeyee will never understand that when an architect works for a project owner he can only be responsible to the owner.

How could you enforce a contract making an architect responsible to a contractor when the architect does not sign the contract? An AIA contract only makes clear what should already be obvious to all parties.

I really don't care if anyone uses an AIA contract. I use them because they save me from the unnecessary work and professional liability of writing a cobbled together version of my own or editing one from a contractor that almost always exposes the owner to unreasonable risk and usually forces the owner to seek the advice of a lawyer.

I have never had a problem with an owner or a contractor when using an AIA contract and many contractors decided to offer them to owners for subsequent projects. One told my partner years later that the AIA Cost of the Work Plus a Fee contract had made him a wealthy man renovating higher end houses.

I would not use an AIA contract for roofing replacement or other limited home improvement projects but if the work involved many subs and created hazards within a home I would insist on it.

One thing that needs to be made clear is that an AIA contract and any other standard contract form is intended by its authors to be revised and amended to suit the project and the parties involved. It is really just a template that contains well known and court tested language.

Standard contract forms from contractor organizations (ConsensusDOCS, etc.) essentially reduce the role of an architect during the construction phase of the project to certification of payment applications and substantial completion.

By contrast, under AIA contracts the architect serves as a representative of the owner and provides assistance to the owner throughout the construction process. Among other things, the architect (1) evaluates and facilitates communications between the owner and the contractor; (2) reviews and evaluates contractor submittals, proposals, and payment applications; (3) periodically visits the site and reports to the owner observed defects and deficiencies in the work; (4) assists the owner in evaluating proposed site superintendents and subcontractors; (5) processes change orders; and (6) may serve as the initial decision maker in disputes between the owner and contractor. Of course, any or all of these services can be crossed out on the form.

Thanks again, Renno8 for your input/time. Without specifics, I'm still not sure what you're talking about, but I think we're getting away from the OP's question(s) at this point.

I'm guessing the OP has left the room by now and is starting a remodel.

To the OP, concerining your concern of a lien in lieu of you writing checks to the subs and other providers, this is from my document on contracts, as a possiblity for contract language:
Contractor will provide the homeowner with lien waivers, lien releases, or acknowledgment of full payment from each subcontractor and materials providers before final payment will be released.

And that would preclude that your contractor provide you with a list of subs and materials providers.

Also. here's a link that may help:

http://ths.gardenweb.com/forums/load/build/msg0816354818392.html?13

Bob

Hi,

Thanks for all your input, especially Renovator8 and bill_g_web. I was away for much of the holiday, just now reading through all the great responses!

I think we're going overboard a bit in terms of what to include in our contract (horror stories littered throughout the internet certainly doesn't help matters). Hearing you folks put things in perspective has helped. We have the potential to work with a highly recommended GC. That alone should minimize a lot of risk. We have lots to think about as we move forward. But, at least I feel more comfortable with available options.

Thanks!

The first thing to determine regarding liens is whether your state allows a sub-contractor lien to be perfected by a court if the Owner paid the General Contractor for the work or materials before the lien was filed. In other words, find out if your state allows an Owner to be forced to pay twice for the same work or materials. Some do and some don't. If your state allows proof of full payment to the GC as a defense, then you only need to be concerned with detailed billing and payment procedures and those should be described in the contract. Using a Cost of the Work contract helps a great deal in that regard.

Second, you need to decide which protection is preferred: a Performance Bond or Lien Wavier/Releases. Both increase the cost of the project for the Owner since the former requires the GC to buy a bond, the cost of which he will pass along to the Owner, and the latter requires the GC to finance the project, the cost of which he will pass along. There is also the issue of the credit worthiness of the GC which can be a problem with small contractors and very low bidders.

If you decide on lien waiver/releases, you need to determine if your state requires them to be on state supplied forms. If so, that form should be included in the contract.

If, in order to lower the cost of the project, you allow the lien wavier/releases to be conditional (they are made before an owner payment is made and take effect after it has been made) then you might consider using the joint check approach but only if you become worried about the GC's financial situation or honesty.

In any event, the generic wording suggested by Bob should be revised to reflect the approach and procedures you decide to use.

I am remodeling a condo. We have a contract with a General Contractor. Two days into the beginning of the project, we found out that the building will be renovating all balconies so we don't have to pay for that. We did a Change Order and the GC gave us a credit for the work and materials he was going to use. However, he will not give us a credit for the 10% General Conditions fee or 10% Overhead and Profit. He says this is standard, is that correct?

It is the usual approach unless otherwise stipulated in the contract.

When you change the subject of a thread you should start a new one.

This post was edited by Renovator8 on Wed, Jan 23, 13 at 8:26

" Two days into the beginning of the project, we found out that the building will be renovating all balconies so we don't have to pay for that. "

Or you can fight back since their have been court cases in a number of places that put balconies accessible to only the owners of a single unit beyond the reach of the association.

You are still paying either way, but it comes down to the control you have over your balcony renovation costs.

"How could you enforce a contract making an architect responsible to a contractor when the architect does not sign the contract?"

That being one of the issues with responsibility.

At least you can go after an attorney that draws up a defective contract, even if they did not sign it.

This post was edited by brickeyee on Wed, Jan 23, 13 at 12:33

The only person who the attorney would be responsible to is his/her client just as an architect is only responsible to his/her client.

I'm doing home renovation right now and I can give you example of things that happened to me personally. On the signing day the contractor came up with 30k labor price that weren't include in any of the bid we seen before. That was a big jump for us. Then the whole entire process has been so many decision makings and all of them involve more money. My architect drew plan for us in a way that we can re use a lot of old stuff like sash cord windows, red wood sidings. But when the workers came they weren't inform in anyway. So they destroyed most of the stuff during the demolition. We thought we had details contract on what has to be done. But as little as we know, our contract is so loose. When they said re-paint house interior, they said later it didn't include painting wood trims. So add that to the cost if I want them painted. Custom cabinets, that doesn't include all the partitions inside. Windows and doors, they don't come with hardware. I want the door to swing out, that also will cost more money. We want push button for light switch, that also costs more...etc...You need to get the detail contract written in a way that the contractor can not tell you later that this has never been discussed.

Everyone has their own experience and preferences when it comes to construction contracts, their scope and specifics.

The thing to remember about the AIA series of documents is that they are the industry standard and the language and provisions are court tested. Document revisions take place on a regularly scheduled basis in order to account for new information, court decisions and the like.

And within the family of AIA documents, there are construction contracts for both small and large projects, interior, exterior and special projects, making them applicable for residential remodels and new house construction.

It's much better for owners to have a contract that is based on their interests rather than the builder's interests.

The information that was missing in Beenana's project was not in the Agreement form but in the drawings and specifications and that would be the fault of the architect if you hired him/her to provide complete documents. Those documents should have included demolition plans with a lot of notes about what was to be saved and how they were to be protected or delivered to the owner.

The same is true during construction; if you hired the architect to oversee the work he/she would insist that the contractor meet the requirements of the the contract documents at no additional cost to you. The idea that trim would not be included in the painting work is ridiculous.

Perhaps you did not ask for full design documents or perhaps the architect is not really an architect and would therefore not be accustomed to providing full design services.

Or, perhaps, your GC is taking advantage of you and your limited knowledge (the whole thing about interior painting not including trim work...) Are you communicating in the same language, and your native language? (I mean no sarcasm in that last question. Your typing suggests English is not your first language).