Fill and Sign the California Home Improvement Form

- 1 - HOME IMPROVEMENT CONTRACT Notice of Cancellation may be sent to the contractor at the address noted on the contract. THIS HOME IMPROVEMENT CONTRACT (“Contract”), effective as of the date of the last party to sign below ____________________________, is between ____________________________, having an address at ("Contractor") and ____________________________, having an address at ("Owner"). For valuable consideration the parties hereby agree as follows: 1. LIST OF DOCUMENTS TO BE INCORPORATED INTO THIS CONTRACT: EXHIBIT A – Commercial General Liability Insurance EXHIBIT B – Workers’ Compensation Insurance EXHIBIT C – 3 day right to cancel EXHIBIT D – 7 day right to cancel EXHIBIT E – Sample change order form The above mentioned Exhibits are hereby incorporated in and made part of this Contract. 2. DESCRIPTION OF THE PROJECT AND DESCRIPTION OF THE SIGNIFICANT MATERIALS TO BE USED AND EQUIPMENT TO BE INSTALLED: (a) Project description: (b) Significant materials to be used: a. Materials to be provided by the Contractor: b. Materials to be provided by the Owner: (c) Equipment to be Installed: (delete (a) through (c) above if the contractor and owner have developed drawings a nd specifications covering everything mentioned above OR delete the section below describing drawings and specifications if you and the customer choose to write all the necessary Project information above. Delete this boxed section also. Contractor shall provide the materials and perform the work described in the written drawings and specifications indicated in Section 1 above. Such drawings and specifi cations shall - 2 - describe the project, specify materials to be used, which party is respon sible for providing such materials, and equipment to be installed. 3. WORK SITE: The Project shall be constructed on the property of Owner located at and more particularly described as (hereafter "the Work Site"). Owner hereby authorizes Contractor to commence and complete the usual and customary excavation and grading on the Work Site as may be required in t he judgment of the Contractor to complete the Project. Unless called for in the drawings or specifications, no landscaping, finish grading, filling or excavation is to be performed at the Work Site by the Contractor. 4. COMMENCEMENT AND COMPLETION OF WORK TO BE PERFORMED: (a) The following describes how Contractor shall substantially commence work: (b) APPROXIMATE START DATE: (c) APPROXIMATE DATE OF SUBSTANTIAL COMPLETION: Contractor shall not be liable, or in breach of this Contract, for any delay d ue to circumstances beyond its control including strikes, casualty, acts of God, or general unavailability of m aterials. 5. PERMITS: Contractor shall apply for and obtain such permits and regulatory approvals as may be required by the local municipal/county government, the cost thereof shal l be included as part of the Project price. 6. SOIL CONDITIONS: Contractor shall have no responsibility for the condition of the soils at t he Work Site. Any excavation, filling or other work required by the Owner other than the usual and customary excavation and grading shall be agreed to in a Change Order for a n amount in addition to the Contract Price. Contractor shall not be responsible for any damages suffered by Owner as a result of the soil conditions at the Work Site. 7. INSURANCE: Contractor shall maintain general liability, workers compensation and builde r's risk insurance. 8. SURVEY AND TITLE: If the Project is near the Owner’s p roperty boundary, Owner will point out property lines to the Contractor. If the Owner or Contractor has any doubt about t he location of the property lines, Owner shall provide Contractor with boundary stakes through a licensed surveyor. In addition, Owner shall provide Contractor documentation that Owner has t itle to the Work Site and shall provide Contractor copies of any covenants, conditions, or re strictions that affect the Work Site. 9. EXTRA WORK AND CHANGE ORDERS: Extra work and change orders become part of this Contract once the order is prepared in writing and signed by both parties pri or to the commencement of any work covered by the new change order. The order must des cribe 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 (if applicable) or the completion date. 10. PRICING - 3 - (a) CONTRACT PRICE: {COST PLUS} Owner agrees to pay Contractor the actual cost to Contractor of materials plus the sum of $ for performing the services set forth in the scope of the work. Contractor shall be paid as follows: . OR {FIXED FEE} Owner agrees to pay Contractor the sum of $ for performing the services set forth in the scope of the work. Contractor shall be paid as follows: . (b) DOWN PAYMENT: Amount: The down payment may not exceed $1,000 or 10 percent of the contract pric e, whichever is less. (c) SCHEDULE OF PROGRESS PAYMENTS: Payment amount in dollars and cents Amount of work or service to be performed Materials or equipment to be supplied 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, al ong 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. Upon satisfactory payment being made for any portion of the work performed, the contractor, prior to any further payment being made, shall furnish to the person contracting for the home improvement or swimming pool work a full and unconditional release from any potential lien - 4 - claimant claim or mechanics lien authorized pursuant to Sections 8400 and 8404 of the Civil Code for that portion of the work for which payment has been made. (d) FINANCE CHARGE (if applicable): Amount: $ Law requires the finance charge to be stated in dollars and cents and to be set out separat ely from the Contract amount. 11. LATE PAYMENT/DEFAULT: A failure to make payment for a period in excess of ten (10) days from the due date shall be deemed a material breach of thi s Contract. If payment is not made when due, Contractor may suspend work on the job until such time as all payment s due have been made without breach of the Contract pending payment or resolution of any dis pute. Owner agrees to pay a late charge of 1% of all payments that are more than ten (10) day s late plus interest at the rate of 1% per month. 12. DESTRUCTION AND DAMAGE : If the Project is destroyed or damaged for any reason, except where such destruction or damage was caused by the sole negli gence of the Contractor or its subcontractors, Owner shall pay Contractor for any additional work done by Contra ctor in rebuilding or restoring the Project to its condition prior to such destruction or damage. If the estimated cost of replacing work already accomplished by Contractor exc eeds 20 percent of the Contract price, either the Contractor or Owner may terminate this Contract. Upon termination by either party, Contractor shall be excused from further performance under this Contract and Owner shall pay Contractor a percentage of the Contract price in proportion to the amount of work accomplished prior to the destruction or damage. 13. ASSIGNMENT : Neither party may assign this Contract, or payments due under the Contra ct, without the other party’s written consent. Any such assignment shall be void and of no effect. 14. INTERPRETATION: (a) Interpretation of Documents. The Contract, drawings, and specifications are intended to supplement one another. In the event of a conflict, the specifications shall control the draw ings, and the Contract shall control both. If work is displayed on the drawings but not called for in the specifications, or if the work is called for in the specifications but not displayed on the drawings, Contractor shall be required to perform the work as though it were called f or and displayed in both documents. (b) Entire Agreement. This Contract constitutes the entire agreement of the parties. No other agreements, oral or written, pertaining to the work to be performed under this Contr act exists between the parties. This Contract may only be modified only by a writ ten agreement signed by both parties. (c) Governing Law. This Contract shall be interpreted and governed in accordance with the laws of the State of California. 15. ATTORNEYS’ FEES AND CO STS: If any party to this Contract brings a cause of action against the other party arising from or relating to this Contract, the pre vailing party in such proceeding shall be entitled to recover reasonable attorney fees and court costs. - 5 - 16. PERFORMANCE: (a) Contractor may, at its discretion, engage licensed subcontractors to perform work pursuant this Contract provided Contractor shall remain fully responsible for the proper comple tion of the Project. (b) All work shall be completed in a workman-like manner and in compliance w ith all building codes and applicable laws. To the extent required by law, all w ork shall be performed by individuals duly licensed and authorized by law to perform said work. (c) Contractor agrees to remove all debris and leave the premises in broom clean condi tion. 17. WARRANTY: Contractor's warranty shall be limited to defects in workmanship within the scope of work performed by Contractor and which arise and become known within one (1) year from the date hereof. All said defects arising after one (1) year and defec ts in material are not warranted by Contractor. Contractor hereby assigns to Owner all warranties on materia ls as provided by the manufacturer of such materials. 18. REQUIRED NOTICES : (a) You are entitled to a completely filled in copy of this Contract, si gned by both you and the Contractor, before any work may be started. (b) A notice concerning commercial general liability insurance is attached to t his Contract. (c) A notice concerning workers’ compensation insurance is attached to t his Contract. (d) Change Orders: i. The Owner may not require a Contractor to perform extra or change-order work without providing written authorization prior to the commencement of any work cove red by the new change order. ii. Extra work or a change order is not enforceable against a buyer unless the c hange order identifies all of the following in writing prior to the commencement of any work covered by the new change order: (i) the scope of work encompassed by the order; (ii) the amount to be added or subtracted from the Contract price; and (iii) the effect t he order will make in the progress payments (if applicable) or the completion date. iii. A Contractor’s failure to comply with the requirements for a change order does not preclude the Contractor’s recovery of compensation for work performed based upon legal or equitable remedies designed to prevent unjust enrichment. (e) 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 mec hanics' lien is a claim, like a mortgage or home equity loan, made against your property a nd 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 coul d be forced to pay twice or have a court officer sell your home to pay the lien. Liens can also aff ect your credit. To - 6 - preserve their right to record a lien, each subcontractor and material suppli er must provide you with a document called a '20-day 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 ha s the right to record a lien on your property if he or she is not paid. BE CAREFUL. The Preliminary Notice c an be sent up to 20 days after the subcontractor starts work or the supplier provides ma terial. 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 contrac tor or from laborers who work on your project. The law assumes that you already know they are improv ing your property. PROTECT YOURSELF FROM LIENS. You can protect yourself from li ens by getting a list from your contractor of all the subcontractors and mate rial suppliers that work on your project. Find out from your contractor when these subcontractors started work a nd when these suppliers delivered goods or materials. Then wait 20 days, pay ing attention to the Preliminary Notices you receive. PAY WITH JOINT CHECKS. One way to prote ct 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, wri te a joint check payable to both the contractor and the subcontractor or material supplier. For other ways to prevent liens, visit CSLB's Web site at www.cslb.ca.gov or call CSL B at 800-321-CSLB (2752). REMEMBE R, 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." (f) 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 report ed to CSLB. Use only licensed contractors. If you file a complaint against a licensed contra ctor within the legal deadline (usually four years), CSLB has authority to investigate the comp laint. 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 Web site at www.cslb.ca.gov ; call CSLB at 800-321-CSLB (2752); or write CSLB at P.O. Box 26000, Sacramento, CA 95826. (a) Under certain circumstances the law gives you a right to cancel a contract. Check the appropriate box below describing your right to cancel this Contract: i. This Contract was negotiated at the Contractor’s place of business. Consequentl y, the law does not provide a right to cancel. ii. This Contract was not negotiated at the Contractor’ s place of business. Consequently, the law requires that the Contractor give you a notice explaining your right to cancel. Initial the checkbox if the Contractor has given you a “Notice of the Th ree-Day Right to Cancel.” iii. This Contract is for the repair or restoration of residential premises da maged by any sudden or catastrophic event for which a state of emergency has been decl ared by the President of the United States or the Governor, or for which a local emergenc y has been declared by the executive officer or governing body of any city, count y, or city and county. Consequently, the law requires that the Contractor give you a notice explaining your right to cancel. Initial the checkbox if the Contrac tor has given you - 7 - a “Notice of the Seven -Day Right to Cancel.” AGREED: CONTRACTOR: Signature Print Name & Title Date Contractor’s License Number Contractor’s Business Address OWNER: Signature Print Name Date If applicable: Salesperson’s Name Salesperson’s Registration Number The owner or tenant has the right to require the contractor to have a performance and payment bond. - 8 - EXHIBIT A COMMERCIAL GENERAL LIABILITY INSURANCE Contractor must check the box that applies This Contractor does not carry commercial general liability insurance. This Contractor carries commercial general liability insurance written by (“Insurance Company”). You may call the Insurance Company at to check Contractor’s insurance coverage. This Contractor is self-insured. This Contractor is a limited liability company that carries liability insurance or maintains other security as required by law. You may call (“Insurance Company or Trust Company or Bank”) at to check Contractor’s insurance coverage to check on the contractor's insurance coverage or securit y. Capitalized terms in this Exhibit shall have the same meanings that are assi gned to those terms in the Contract. - 9 - EXHIBIT B WORKERS’ COMPENSATION INSURANCE Contractor must check the box that applies This Contractor has no employees and is exempt from workers’ compensation requirements. This Contractor carries workers’ compensation insurance for all employees. Capitalized terms in this Exhibit shall have the same meanings that are assi gned to those terms in the Contract. - 10 - EXHIBIT C 3 DAY RIGHT TO CANCEL This page is only applicable if this Contract was not negotiated at the Contractor’s place of business. If so, the Owner is to receive two (2) copies. Capitalized terms in thi s Exhibit shall have the same meanings that are assigned to those terms in the Contract. Notice of Cancellation (copy 1 of 2) Date last party signed the Contract You may cancel this transaction, without any penalty or obligation, within three business days from the above date. If you cancel, any property traded in, any payments made by you under the contract or sale , and any negotiable instrument executed by you will be returned within 10 days followin g receipt by the seller of your cancellation notice, and any security interest arising out of the tran saction will be canceled. If you cancel, you must make available to the seller at your residence, in substanti ally as good condition as when received, any goods delivered to you under this contract or sale , or you may, if you wish, comply with the instructions of the seller regarding the return ship ment of the goods at the seller's expense and risk. If you do make the goods available to the seller and the seller does not pick them up within 20 days of the date of your notice of cancellation, you may retain or dispose of the goods without any further obligation. If you fail to make the goods available to the seller, or if you agree to retur n the goods to the seller and fail to do so, then you remain liable for performance of all obligati ons under the contract. To cancel this transaction, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, or send a telegram to Name of Seller (Contractor or Salesman) at Address of Seller’s Place of Business not later than midnight of . Date I hereby cancel this transaction. Date Owner’s Signature Print Owner’s Name - 11 - EXHIBIT C (continued) This page is only applicable if this Contract was not negotiated at the Contractor’s place of business. If so, the Owner is to receive two (2) copies. Capitalized terms in thi s Exhibit shall have the same meanings that are assigned to those terms in the Contract. Notice of Cancellation (copy 2 of 2) Date last party signed the Contract You may cancel this transaction, without any penalty or obligation, within three business days from the above date. If you cancel, any property traded in, any payments made by you under the contract or sale, an d any negotiable instrument executed by you will be returned within 10 days followi ng receipt by the seller of your cancellation notice, and any security interest arising out of the tran saction will be canceled. If you cancel, you must make available to the seller at your residence, in substanti ally as good condition as when received, any goods delivered to you under this contract or sale , or you may, if you wish, comply with the instructions of the seller regarding the return shipm ent of the goods at the seller's expense and risk. If you do make the goods available to the seller and the seller does not pick them up within 20 days of the date of your notice of cancellation, you may retain or dispose of the goods without any further obligation. If you fail to make the goods available to the seller, or if you agree to retur n the goods to the seller and fail to do so, then you remain liable for performance of all obligati ons under the contract. To cancel this transaction, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, or send a telegram to Name of Seller (Contractor or Salesman) at Address of Seller’s Place of Business not later than midnight of . Date I hereby cancel this transaction. Date Owner’s Signature Print Owner’s Name - 12 - EXHIBIT D This page is only applicable if the Contract is for the repair or restoration of res idential premises damaged by any sudden or catastrophic event for which a state of emergency has bee n declared by the President of the United States or the Governor, or for which a local emergen cy has been declared by the executive officer or governing body of any city, county, or city and county. If so, the Owner must receive two (2) copies. Capitalized terms in this Exhibit shall have the same meanings that are assigned to those terms in the Contract. Notice of Cancellation (copy 1 of 2) Date last party signed the Contract You may cancel this transaction, without any penalty or obligation, within seven business d ays from the above date. If you cancel, any property traded in, any payments made by you under the contract or sale, an d any negotiable instrument executed by you will be returned within 10 days followin g receipt by the seller of your cancellation notice, and any security interest arising out of the tran saction will be canceled. If you cancel, you must make available to the seller at your residence, in substanti ally as good condition as when received, any goods delivered to you under this contract or sale , or you may, if you wish, comply with the instructions of the seller regarding the return shipm ent of the goods at the seller's expense and risk. If you do make the goods available to the seller and the seller does not pick them up within 20 days of the date of your notice of cancellation, you may retain or dispose of the goods without any further obligation. If you fail to make the goods available to the seller, or if you agree to retur n the goods to the seller and fail to do so, then you remain liable for performance of all obligati ons under the contract. To cancel this transaction, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, or send a telegram to Name of Seller (Contractor or Salesman) at Add ress of Seller’s Place of Business not later than midnight of . Date I hereby cancel this transaction. Date Owner’s Signature Print Owner’s Name - 13 - EXHIBIT D (continued) This page is only applicable if the Contract is for the repair or restoration of res idential premises damaged by any sudden or catastrophic event for which a state of emergency has bee n declared by the President of the United States or the Governor, or for which a local emergen cy has been declared by the executive officer or governing body of any city, county, or city and county. If so, the Owner must receive two (2) copies. Capitalized terms in this Exhibit shall have the same meanings that are assigned to those terms in the Contract. Notice of Cancellation (copy 2 of 2) Date last party signed the Contract You may cancel this transaction, without any penalty or obligation, within seven business d ays from the above date. If you cancel, any property traded in, any payments made by you under the contract or sale , and any negotiable instrument executed by you will be returned within 10 days followin g receipt by the seller of your cancellation notice, and any security interest arising out of the tran saction will be canceled. If you cancel, you must make available to the seller at your residence, in substanti ally as good condition as when received, any goods delivered to you under this contract or sale , or you may, if you wish, comply with the instructions of the seller regarding the return shipm ent of the goods at the seller's expense and risk. If you do make the goods available to the seller and the seller does not pick them up within 20 days of the date of your notice of cancellation, you may retain or dispose of the goods without any further obligation. If you fail to make the goods available to the seller, or if you agree to retur n the goods to the seller and fail to do so, then you remain liable for performance of all obligati ons under the contract. To cancel this transaction, mail or deliver a signed and dated copy of this cancellation notice, or any other written notice, or send a telegram to Name of Seller (Contractor or Salesman) at Add ress of Seller’s Place of Business not later than midnight of . Date I hereby cancel this transaction. Date Owner’s Signature Print Owner’s Name - 14 - EXHIBIT E Capitalized terms in this Exhibit shall have the same meanings that are assi gned to those terms in the Contract. SAMPLE CHANGE ORDER A. Scope of work encompassed by this change order: B. Amount to be added or subtracted from the Contract price: C. Effect this change order will have on progress payments (if applicable): D. Effect this change order will have on the estimated completion date: AGREED: CONTRACTOR: Signature Print Name & Title Date OWNER: Signature Print Name Date - 15 - Checklist for Homeowners Check Out Your Contractor Did you contact the Contractors State License Board (CSLB) to check the status of the contract or's license? Contact the CSLB at 1-800-321-CSLB (2752) or visit our web site: www.cslb.ca.gov. Did you get at least 3 local references from the contractors you are considering? Did you call them? Building Permits - will the contractor get a permit before the work starts? Check Out the Contract Did you read and do you understand your contract? Does the 3-day right to cancel a contract apply to you? Contact the CSLB if you don't know. Does the contract tell you when work will start and end? Does the contract include a detailed description of the work to be done, the material t o be used, and equipment to be installed? This description should include brand names, model numbers, quantities and colors. Specific descri ptions now will prevent disputes later. Are you required to pay a down payment? If you are, the down payment should never be more than 10% of the contract price or $1,000, whichever is less. Is there a schedule of payments? If there is a schedule of payments, you should pay only as work is completed and not before. There a re some exceptions - contact the CSLB to find out what they are. Did your contractor give you a “Notice to Owner,” a warning notice describing liens and wa ys to prevent them? Even if you pay your contractor, a lien can be placed on your home by unpaid laborers, subcontractors o r material suppliers. A lien can result in you paying twice or, in some cases, losing your home in a foreclosure. Check the “Notice to Owner” for ways to protect yourself. Did you know changes or additions to your contract must be in writing? Putting changes in writing reduces the possibility of a later dispute.