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You don't have to sign someone else's contract.

Contracts are negotiable and are primarily intended to benefit the person or entity that paid for them to be drafted.  But you don't have to sign the contract as presented.  You can negotiate. 

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When confronted with a contract someone else drafted, here are some of the things you should look for: 

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  • Who is responsible for getting the permits?

  • Is the contractor obligated to follow a set of plans? 

  • Who checks to see if plans are followed?

  • What happens if the plans aren't followed?

  • Is the builder to be paid a fixed percentage (cost plus), a specific fee (contractor's fee) or an agreed amount (agreed sum)?

  • What is the approval process for paying the builder?

  • How long does the owner have to pay the builder?

  • Who decides whether to pay the builder?

  • What happens if a subcontractor is not paid?

  • Is the owner obligated to inspect the builder's work?

  • What happens if work is rejected?

  • Which subcontractors will perform work?

  • Do the subcontractors have written contracts?

  • Do the subcontractors have insurance?

  • How does the change order process work?

  • Does the builder guarantee completion by a specific date? 

  • How are the warranties limited?

  • Does the builder warrant its own work or farm that responsibility out to a third party?

  • What happens if the builder stops work?

  • How is "default" defined in the contract?

  • What insurance must the builder carry?

  • Are the parties bound to arbitration?

  • Does the contract prohibit recovery of certain damages?

  • Is a residential construction contract accompanied by the Disclosure Statement required by Texas Property Code Section 53.255?

  • Does the residential construction contract refer to the Residential Construction Liability Act? 

  • Does the residential construction contract say this:

 

THIS CONTRACT IS SUBJECT TO CHAPTER 27 OF THE TEXAS PROPERTY CODE. THE PROVISIONS OF THAT CHAPTER MAY AFFECT YOUR RIGHT TO RECOVER DAMAGES ARISING FROM A CONSTRUCTION DEFECT. IF YOU HAVE A COMPLAINT CONCERNING A CONSTRUCTION DEFECT AND THAT DEFECT HAS NOT BEEN CORRECTED AS MAY BE REQUIRED BY LAW OR BY CONTRACT, YOU MUST PROVIDE THE NOTICE REQUIRED BY CHAPTER 27 OF THE TEXAS PROPERTY CODE TO THE CONTRACTOR BY CERTIFIED MAIL, RETURN RECEIPT REQUESTED, NOT LATER THAN THE 60TH DAY BEFORE THE DATE YOU FILE SUIT TO RECOVER DAMAGES IN A COURT OF LAW OR INITIATE ARBITRATION. THE NOTICE MUST REFER TO CHAPTER 27 OF THE TEXAS PROPERTY CODE AND MUST DESCRIBE THE CONSTRUCTION DEFECT. IF REQUESTED BY THE CONTRACTOR, YOU MUST PROVIDE THE CONTRACTOR AN OPPORTUNITY TO INSPECT AND CURE THE DEFECT AS PROVIDED BY SECTION 27.004 OF THE TEXAS PROPERTY CODE.

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The Spaeth Law Firm drafts custom construction contracts to fit your needs.  These can include provisions that:

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  • Require the builder to follow the plans or get permission from the architect to depart from them.

  • Require the builder to supply invoices and receipts before getting paid.

  • Require the builder to identify subcontractors and suppliers.

  • Require the builder to achieve milestones before getting paid.

  • Define a process for rejecting work and resolving disputes over rejected work.

  • Require Indemnification in the event your property becomes the subject of a lien by a subcontractor.

  • Provide enforceable warranties that will actually work.

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