This general contractor agreement is signed on , and is between , an individuala(n) (the "Contractor") and , an individuala(n) (the "Owner").
The Owner is the owner of the Property (as defined below).
The Owner wishes to engage the Contractor as a general contractor to perform certain Work (as defined below) on the Property for the Owner in accordance with the drawings and specifications in Exhibit A.
The Contractor is registered with the state as a contractor, and has a registration number of expiring on .
The Contractor wants to perform the Work on the Property in accordance with the drawings and specifications in Exhibit A.
The parties therefore agree as follows:
1. ENGAGEMENT; SERVICES.
- (a) Engagement. The Owner retains the Contractor to perform, and the Contractor shall perform, the work described in Exhibit B (the "Work").
- (b) Services. Without limiting the scope of the Work described in Exhibit B, the Contractor shall:
- (i) perform the Work set forth in Exhibit B. However, if a conflict exists between this agreement and any term in Exhibit B, the terms in this agreement will control;
- (ii) devote as much productive time, energy, and ability to the performance of its duties under this agreement as may be necessary to provide the required Work in a timely and productive manner;
- (iii) perform the Work in a safe, good, and workmanlike manner by fully trained, licensed, competent, and experienced personnel using at all times adequate equipment in good working order;
- (iv) perform the work according to standard industry practices and comply with all building codes and other applicable laws;
- (v) communicate with the Owner about progress the Contractor has made in performing the Work;
- (vi) supply all tools, equipment, and supplies required to perform the Work, except if the Contractor's work must be performed on or with the Owner's equipment;
- (vii) ensure that all materials and equipment furnished to its personnel are of good and merchantable quality, unless otherwise agreed by the Owner;
- (viii) provide the Owner with appropriate releases or waivers of liens at the time of payment for any Work performed;
- (ix) obtain all necessary approvals for the Work from local authorities or other government entities and indemnify the Owner for any violations;
- (x) obtain insurance to protect itself against claims for property damage, bodily injury, or death due to its performance under this agreement;
- (xi) at all times provide access to the Work to the Owner, the Owner's representatives, and public authorities;
- (xii) provide work (including the Work) and end products that are satisfactory and acceptable to the Owner and free of defects;
- (xiii) remove any debris or other garbage from the Property, and leave the Property in broom-clean condition after the Work has been completed; and
- (xiv) remove, replace, or correct all or any portion of the work or end products found defective or unsuitable, without additional cost or risk to the Owner.
2. SCOPE OF WORK.
The Contractor shall furnish all of the necessary materials, tools, machinery, supervision, relocation and, site security and perform all of the work described in Exhibit B (the "Work"), all in accordance with this agreement. The Work shall be performed on that certain property located at , , , (the "Property"), and as more specifically described in Exhibit B. The Contractor shall perform the services and provide the materials for which it is responsible, will accomplish this Work in the manner and in the time stated in this agreement, and in accordance with the drawings and specifications attached as Exhibit A, and will provide the deliverables as required.
3. TIME OF COMPLETION.
- (a) Approximate Start Date. The Contractor shall start performing the Work on or before .
- (b) Approximate Completion Date. The Work will be substantially completed on or before .
- (c) Late Penalty. Because time is of the essence, the Contractor will, if this Work is not completed within this time period, be assessed an amount of for each day the Work is not substantially completed after , unless an extension is granted by the Owner. Liquidated damages will be deducted from the total Contract Price (as defined below).
- (c)(d) Early Bonus. If the Work is completed early, the Contractor will receive a bonus payment in the amount of .
4. CONTRACT PRICE.
The Owner shall pay to the Contractor for the performance of this agreement the amount of (the "Contract Price").
5. PROGRESS PAYMENTS.
- (a) Payments. The Owner shall pay the Contract Price as follows:
- (i) % on delivery of all materials and commencement of the Work;
- (ii) % within days of the parties' agreement that half of the Work has been completed;
- (iii) % within days of the parties' agreement that the Work has been completed; and
- (iv) % on receipt of contract, labor, and manufacturer's warranty, and completion of the Owner's inspection of the Work.
- (b) CALIFORNIA NOTICE: The schedule of progress payments must specifically describe each phase of work, including the type and amount of work or services scheduled to be supplied in each phase, along with the amount of each proposed progress payment. IT IS AGAINST THE LAW FOR A CONTRACTOR TO COLLECT PAYMENT FOR WORK NOT YET COMPLETED, OR FOR MATERIALS NOT YET DELIVERED. HOWEVER, A CONTRACTOR MAY REQUIRE A DOWNPAYMENT.
- (c) CALIFORNIA MECHANICS LIEN WARNING. Anyone who helps improve your property, but who is not paid, may record what is called a mechanics lien on your property. A mechanics lien is a claim, like a mortgage or home equity loan, made against your property and recorded with the county recorder.
- Even if you pay your contractor in full, unpaid subcontractors, suppliers, and laborers who helped to improve your property may record mechanics liens and sue you in court to foreclose the lien. If a court finds the lien is valid, you could be forced to pay twice or have a court officer sell your home to pay the lien. Liens can also affect your credit.
- To preserve their right to record a lien, each subcontractor and material supplier must provide you with a document called a 'Preliminary Notice.' This notice is not a lien. The purpose of the notice is to let you know that the person who sends you the notice has the right to record a lien on your property if he or she is not paid.
- BE CAREFUL. The Preliminary Notice can be sent up to 20 days after the subcontractor starts work or the supplier provides material. This can be a big problem if you pay your contractor before you have received the Preliminary Notices.
- You will not get Preliminary Notices from your prime contractor or from laborers who work on your project. The law assumes that you already know they are improving your property.
- PROTECT YOURSELF FROM LIENS. You can protect yourself from liens by getting a list from your contractor of all the subcontractors and material suppliers that work on your project. Find out from your contractor when these subcontractors started work and when these suppliers delivered goods or materials. Then wait 20 days, paying attention to the Preliminary Notices you receive.
- PAY WITH JOINT CHECKS. One way to protect yourself is to pay with a joint check. When your contractor tells you it is time to pay for the work of a subcontractor or supplier who has provided you with a Preliminary Notice, write a joint check payable to both the contractor and the subcontractor or material supplier.
- For other ways to prevent liens, visit CSLB's Internet Web site at www.cslb.ca.gov or call CSLB at 800-321-CSLB (2752).
- REMEMBER, IF YOU DO NOTHING, YOU RISK HAVING A LIEN PLACED ON YOUR HOME. This can mean that you may have to pay twice, or face the forced sale of your home to pay what you owe.
- (c) Affidavit of Contractor. Before the Owner makes each payment, the Contractor shall affirm, in writing, that there are no liens or claims filed against the Contractor or the Owner relating to materials, labor, or services supplied on this or any other project in which the Contractor was or is currently involved. The Owner shall make no payment to the Contractor if a lien has been filed related to the Work.
- (d) Withholding of Payments. The Owner may withhold payment of the Contract Price if:
- (i) the Contractor does not remedy defective Work;
- (ii) the Contractor continues to fail to perform the Work in accordance with this agreement or these general conditions;
- (iii) there are liens or claims filed; or
- (iv) the Contractor fails to make proper payments to subcontractors, workers, or suppliers for labor, materials, or equipment.
- (e) Final Payment. After the Owner makes its final payment, the Contractor shall provide to the Owner a final release of lien stating that the Contractor has no further claims or liens against the Owner for materials or labor supplied under this agreement.
- (f) Waiver of Owner's Claims. The making of final payment constitutes a waiver of all claims by the Owner except those arising from:
- (i) unsettled liens;
- (ii) faulty or defective work appearing after substantial completion; or
- (iii) failure of the Work to comply with the requirements of Exhibit A.
- (g) Waiver of Contractor's Claims. The acceptance of the final payment shall constitute a waiver of all claims by the Contractor except those previously made in writing and identified by the Contractor as unsettled at the time of the final payment.
- (h) Payment Failure. If the Owner fails to make any payment due, the Contractor may stop the Work. However, the Contractor shall resume performance of the Work and other obligations after payment or other resolution of the dispute.
6. LICENSES, PERMITS AND INSURANCE.
- (a) Licenses and Permits. The Contractor shall comply with all state and local licensing and registration requirements for the type of work performed. The Contractor shall obtain and, at its expense, pay for all licenses or permits required by law to accomplish any Work required in connection with this agreement and indemnify the Owner for any violations.
- (b) California General Commercial Liability Insurance. The Contractor does not carry commercial general liability insurance. carries commercial general liability insurance written by . The Owner may call at to check the contractor's insurance coverage is a limited liability company that carries liability insurance or maintains other security as required by law. The Owner may call at to check on the Contractor's insurance coverage or security.
- (c) California Workers' Compensation Insurance. The Contractor has no employees and is exempt from workers' compensation requirements. The Contractor carries workers'compensation insurance for all employees.
- (d) Information about the Contractors' State License Board (CSLB). CSLB is the state consumer protection agency that licenses and regulates construction contractors.
- Contact CSLB for information about the licensed contractor you are considering, including information about disclosable complaints, disciplinary actions, and civil judgments that are reported to CSLB.
- Use only licensed contractors. If you file a complaint against a licensed contractor within the legal deadline (usually four years), CSLB has authority to investigate the complaint. If you use an unlicensed contractor, CSLB may not be able to help you resolve your complaint. Your only remedy may be in civil court, and you may be liable for damages arising out of any injuries to the unlicensed contractor or the unlicensed contractor's employees.
- For more information:
- Visit CSLB's Internet Web site at www.cslb.ca.gov
- Call CSLB at 800-321-CSLB (2752)
- Write CSLB at P.O. Box 26000, Sacramento, CA 95826.
- (a) The parties each hereby represent as follows:
- (i) The drawings and specifications attached to this agreement as Exhibit A are the final drawings and specifications of the Work, and form an integral part of this agreement. Neither party may add or otherwise vary additions said drawings and specifications without the prior written consent of the other party.
- (ii) The Contractor may, in its discretion, engage licensed subcontractors to perform the Work. However, the Contractor must fully pay those subcontractors and, in all instances, will remain responsible for the completion of this agreement and the Work.
- (b) The Contractor hereby represents as follows:
- (i) The Contractor warrants that it is adequately insured for injury to its employees and others incurring loss or injury as a result of the acts of the Contractor or its employees or subcontractors and shall provide the Owner with proper certificates of insurance. The Contractor acknowledges that it is solely responsible for providing insurance coverage for itself and its staff.
- (c) The Owner hereby represents as follows:
- (i) The Owner is the registered owner of the Property.
- (ii) The Owner will make timely payments of amounts earned by the Contractor under this agreement.
- (iii) The Owner shall notify the Contractor of any changes to its procedures affecting the Contractor's obligations under this agreement at least 45 days prior to implementing such changes.
- (iv) The Owner shall provide such other assistance to the Contractor as it deems reasonable and appropriate.
8. WAIVER OF LIABILITY.
If the Contractor is injured while performing the Work, the Owner will be exempt from liability for those injuries to the fullest extent allowed by law.
9. SURETY BOND.
Before starting the Work, the Contractor shall obtain a surety bond in the amount of , which will cover its obligations under this agreement.
The Contractor shall indemnify the Owner against all damages, liabilities, costs, expenses, claims, or judgments, including, without limitation, reasonable attorneys' fees and disbursements that any of them may suffer from or incur and that arise or result primarily from (a) any gross negligence or willful misconduct of the Contractor arising from or connected with Contractor's carrying out of its duties under this agreement, or (b) the Contractor's breach of any of its obligations, agreements, or duties under this agreement.
- (a) Correction of Defective Work. The Contractor shall promptly correct any Work rejected as defective or as failing to conform to Exhibit A, whether observed before or after substantial completion and whether or not fabricated, installed, or completed, and shall correct any Work found to be defective or nonconforming within a period of time as may be prescribed by law. The Contractor shall correct these mistakes within a reasonable time after receiving the Owner's written instructions and at its own cost (unless otherwise agreed by the parties). However, the Contractor is not required to correct at its own cost any damage that occurred after completion of the Work, unless the parties agree that the damage occurred because of an injury that took place before the Work was completed.
- (b) Normal Wear and Tear Only. The Contractor shall only be responsible for damages sustained by the Owner under conditions of normal wear and tear, and shall under no circumstances be responsible for damages or losses caused by wear and tear, misuse, neglect, negligence, abuse, or accident, or because of or arising from any risk insured against in terms of the homeowner's insurance policies normally issued by a reputable insurance company for residential properties. The Contractor shall under no circumstances be liable for any consequential loss or damage.
This agreement may be terminated:
- (a) By either party on provision of 30 days' written notice to the other party, with or without cause.
- (b) By either party for a material breach of any provision of this agreement by the other party, if the other party's material breach is not cured within 30 days of receipt of written notice thereof.
- (c) By the Owner, if the Contractor defaults or persistently fails or neglects to carry out the Work or fails to perform any provision of the agreement after 30 days' written notice to the Contractor. Without prejudice to any other remedy the Owner may have, the Owner may make good such deficiencies and may deduct the cost thereof from the payment due the Contractor or, at the Owner's option, may terminate the agreement and take possession of the site and of all materials and equipment.
- (d) By the Owner at any time and without prior notice, if the Contractor is convicted of any crime or offense, fails or refuses to comply with the written policies or reasonable directives of the Owner, or is guilty of serious misconduct in connection with performance under this agreement.
In the event of termination not the fault of the Contractor, the Company shall promptly pay the Contractor according to the terms of Exhibit A for services rendered before the effective date of the termination. The Contractor acknowledges and agrees that no other compensation, of any nature or type, shall be payable hereunder following the termination of this agreement.
13. CALIFORNIA NOTICE OF THREE-DAY RIGHT TO CANCEL.
THE OWNER HAS AN UNCONDITIONAL RIGHT TO CANCEL THE CONTRACT UNTIL MIDNIGHT OF THE THIRD BUSINESS DAY AFTER THE AGREEMENT IS SIGNED. CANCELLATION MUST BE DONE IN WRITING.
A form of Notice of Cancellation is attached to this agreement as Exhibit C.
14. NATURE OF RELATIONSHIP.
The Contractor is not an employee of the Owner; the Contractor is working in its capacity as an independent contractor. The Contractor shall indemnify the Owner for any claims, including (but not limited to) liability insurance, workers' compensation, and tax withholding for the Contractor's employees.
15. NOTE ABOUT EXTRA WORK AND CHANGE ORDERS.
- (a) All changes or deviations in the Work ordered by the Owner must be in writing as a change order, a form of which is attached as Exhibit C. The Contract Price and time of completion, if applicable, will be increased or decreased accordingly by the parties' agreement. Any claims that the Contract Price or time of completion should be increased based on changes or deviations in the Work must be presented to the Owner by the Contractor in writing. The Owner's written approval of such Contract Price or time of completion increase must be obtained by the Contractor before any change or deviation in the Work is started. The valuation of the Contract Price change will be assessed on the basis of the valuation of similar work included in this agreement.
- (b) California Notice. Extra work and change orders become part of the contract once the order is prepared in writing and signed by the parties prior to the commencement of work covered by the new change order. The order must describe the scope of the extra work or change, the cost to be added or subtracted from the contract, and the effect the order will have on the schedule of progress payments.
16. OWNERSHIP OF DRAWINGS AND OTHER ITEMS.
All drawings, reports, designs, sketches, working drawings, shop drawings, documents, certificates, plans, specifications, estimates, memoranda, analyses, calculations, models and other tangible evidence of the Contractor's work product prepared in connection with the Work shall become and remain the sole property of the Owner. The Contractor may retain copies of its work product for its records, but may not use this work product (except in performing the Work) without the written consent of the Owner. Any devices (other than equipment or devices that constitute part of the Work) or methods now being used in the marketplace, and incorporated into the project, are not considered to be property of the Owner. Innovative construction methods or mechanical devices developed by the Contractor or its subcontractors and used in connection with the Work are not considered the property of the Owner unless those methods or devices were developed by the Owner or the Owner's separate contractors.
17. TYPES OF MATERIALS.
All materials used by the Contractor in performing the work will be new, in compliance with all applicable laws and codes, and covered by a manufacturer's warranty (if appropriate) except as agreed upon in a signed writing by the Owner.
18. OWNERSHIP OF MATERIALS.
Any materials that are unfixed and required to perform the Work and that are delivered to the Property under this agreement shall remain the property of the Contractor until they have been paid for by the Owner.
19. MATERIALS IN SHORT SUPPLY.
If any of the materials set out in Exhibit A are in short supply or are unavailable for an unreasonable amount of time, the Owner shall select alternative material of similar quality from alternative (and readily available) materials proposed by the Contractor. The responsibility for paying any difference in price between the original materials and the alternative materials shall lie with the Owner.
20. GOVERNING LAW.
- (a) Choice of Law. The laws of the state of govern this agreement (without giving effect to its conflicts of law principles).
- (b) Choice of Forum. Both parties consent to the personal jurisdiction of the state and federal courts in County, .
- (c) Attorneys' Fees. If either party employs attorneys to enforce any rights arising out of or relating to this agreement, the losing party shall reimburse the prevailing party for its reasonable attorneys' fees.
No amendment to this agreement will be effective unless it is in writing and signed by both parties.
22. ASSIGNMENT AND DELEGATION.
- (a) No Assignment. Neither party may assign any of its rights under this agreement, except with the prior written consent of the other party. All voluntary assignments of rights are limited by this subsection.
- (b) No Delegation. Neither party may delegate any performance under this agreement, except with the prior written consent of the other party.
- (c) Enforceability of an Assignment or Delegation. If a purported assignment or purported delegation is made in violation of this section, it is void.
23. COUNTERPARTS; ELECTRONIC SIGNATURES.
- (a) Counterparts. The parties may execute this agreement in any number of counterparts, each of which is an original but all of which constitute one and the same instrument.
- (b) Electronic Signatures. This agreement, agreements ancillary to this agreement, and related documents entered into in connection with this agreement are signed when a party's signature is delivered by facsimile, email, or other electronic medium. These signatures must be treated in all respects as having the same force and effect as original signatures.
If any one or more of the provisions contained in this agreement is, for any reason, held to be invalid, illegal, or unenforceable in any respect, that invalidity, illegality, or unenforceability will not affect any other provisions of this agreement, but this agreement will be construed as if those invalid, illegal, or unenforceable provisions had never been contained in it, unless the deletion of those provisions would result in such a material change so as to cause completion of the transactions contemplated by this agreement to be unreasonable.
- (a) Writing; Permitted Delivery Methods. Each party giving or making any notice, request, demand, or other communication required or permitted by this agreement shall give that notice in writing and use one of the following types of delivery, each of which is a writing for purposes of this agreement: personal delivery, mail (registered or certified mail, postage prepaid, return-receipt requested), nationally recognized overnight courier (fees prepaid), facsimile, or email.
- (b) Addresses. A party shall address notices under this section to a party at the following addresses:
- If to the Owner:
- (c) Effectiveness. A notice is effective only if the party giving notice complies with subsections (a) and (b) and if the recipient receives the notice.
No waiver of a breach, failure of any condition, or any right or remedy contained in or granted by the provisions of this agreement will be effective unless it is in writing and signed by the party waiving the breach, failure, right, or remedy. No waiver of any breach, failure, right, or remedy will be deemed a waiver of any other breach, failure, right, or remedy, whether or not similar, and no waiver will constitute a continuing waiver, unless the writing so specifies.
27. ENTIRE AGREEMENT.
This agreement constitutes the final agreement of the parties. It is the complete and exclusive expression of the parties' agreement about the subject matter of this agreement. All prior and contemporaneous communications, negotiations, and agreements between the parties relating to the subject matter of this agreement are expressly merged into and superseded by this agreement. The provisions of this agreement may not be explained, supplemented, or qualified by evidence of trade usage or a prior course of dealings. Neither party was induced to enter this agreement by, and neither party is relying on, any statement, representation, warranty, or agreement of the other party except those set forth expressly in this agreement. Except as set forth expressly in this agreement, there are no conditions precedent to this agreement's effectiveness.
The descriptive headings of the sections and subsections of this agreement are for convenience only, and do not affect this agreement's construction or interpretation.
This agreement will become effective when all parties have signed it. The date this agreement is signed by the last party to sign it (as indicated by the date associated with that party's signature) will be deemed the date of this agreement.
30. NECESSARY ACTS; FURTHER ASSURANCES.
Each party shall use all reasonable efforts to take, or cause to be taken, all actions necessary or desirable to consummate and make effective the transactions this agreement contemplates or to evidence or carry out the intent and purposes of this agreement.
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Each party is signing this agreement on the date stated opposite that party's signature.
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DRAWINGS AND SPECIFICATIONS
(attach to agreement)
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SCOPE OF WORK
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FORM OF CHANGE ORDER
Change Order No:
Contractor's Name and Address:
Owner's Name and Address:
THE CONTRACTOR AGREEMENT IS HEREBY CHANGED AS FOLLOWS:
Additional days needed to complete Work: (if none, state "NONE"):
ALL OTHER TERMS AND CONDITIONS OF THE CONTRACTOR AGREEMENT THAT ARE NOT CHANGED BY THIS CHANGE ORDER REMAIN IN FULL FORCE AND EFFECT.
PREVIOUS CONTRACT PRICES: $
REVISED CONTRACT PRICE: $
The above prices, specifications, and conditions are satisfactory, and are hereby accepted. The Contractor is authorized to do the work as specified, and the Owner shall make payments as outlined above.
Owner Signature: _________________________________________ Date: __________________
Contractor Signature: ______________________________________ Date: __________________