CONSTRUCTION SERVICES AGREEMENT

(Rhode Island – Mechanics’ Lien & Prompt-Pay Compliant)

[// GUIDANCE: Drafted to comply with Rhode Island construction, lien, prompt-pay, and “Little Miller Act” bond requirements while incorporating industry-standard risk allocation. Customize bracketed items before execution.]

DOCUMENT HEADER

This Construction Services Agreement (the “Agreement”) is made and entered into as of [EFFECTIVE DATE] (the “Effective Date”), by and between:

1. [OWNER LEGAL NAME], a [STATE & TYPE OF ENTITY], with its principal place of business at [ADDRESS] (“Owner”); and
2. [CONTRACTOR LEGAL NAME], a [STATE & TYPE OF ENTITY], with its principal place of business at [ADDRESS] (“Contractor”).

Owner and Contractor are sometimes referred to individually as a “Party” and collectively as the “Parties.”

RECITALS

A. Owner owns or controls certain real property located at [PROJECT ADDRESS / LEGAL DESCRIPTION] in the State of Rhode Island (the “Site”).
B. Owner desires that Contractor furnish all labor, materials, equipment, and services necessary to construct [PROJECT DESCRIPTION] (the “Project”) at the Site.
C. Contractor is duly qualified and willing to perform such work under the terms and conditions set forth herein.
NOW, THEREFORE, in consideration of the mutual covenants and promises herein, the Parties agree as follows:

TABLE OF CONTENTS

1. Definitions
2. Scope of Work
3. Contract Price, Payment, Retainage & Lien Compliance
4. Schedule & Milestones
5. Permits, Licenses & Codes
6. Representations & Warranties
7. Covenants
8. Insurance & Bonds
9. Indemnification
10. Limitation of Liability
11. Events of Default & Remedies
12. Force Majeure
13. Dispute Resolution
14. General Provisions
15. Execution
16. Exhibits

1. DEFINITIONS

For purposes of this Agreement, capitalized terms have the meanings set forth below. Any term not defined herein but defined in the Contract Documents (as defined in Section 2.3) shall have the meaning provided therein.

“Applicable Law” – All federal, state, and local statutes, regulations, ordinances, codes, and orders governing the Project, including but not limited to Rhode Island Mechanics’ Lien Law (R.I. Gen. Laws § 34-28-1 et seq.), Rhode Island Prompt Payment/Retainage statutes, and Rhode Island “Little Miller Act” payment bond requirements (R.I. Gen. Laws § 37-12-1 et seq.).

“Change Order” – A written modification to the Contract Documents executed by both Parties in accordance with Section 2.6.

“Completion” – Substantial completion of the Work as certified by the Architect/Engineer or Owner under Section 4.4.

“Contract Price” – The total compensation payable to Contractor for performance of the Work, as set forth in Section 3.1, subject to adjustments by Change Order.

“Retainage” – That portion of each Progress Payment withheld by Owner under Section 3.4.

“Work” – All labor, services, materials, equipment, and other efforts required of Contractor by the Contract Documents.

[// GUIDANCE: Add additional defined terms alphabetically as needed.]

2. SCOPE OF WORK

2.1 Performance. Contractor shall perform the Work diligently, in a good and workmanlike manner, and in strict accordance with the Contract Documents.
2.2 Standard of Care. Contractor shall employ the degree of professional skill, care, and diligence normally exercised by qualified contractors performing similar work in Rhode Island.
2.3 Contract Documents. The following, together with any exhibits hereto, comprise the “Contract Documents”:
a. This Agreement;
b. Drawings, Specifications, and technical documents listed in Exhibit A;
c. Approved Change Orders; and
d. Any other documents executed by the Parties expressly identified as Contract Documents.
2.4 Hierarchy. In the event of a conflict among Contract Documents, the terms of this Agreement shall govern, followed by Change Orders (later date controls), the Specifications, and the Drawings.
2.5 Contractor’s Representative. [NAME & TITLE] is designated as Contractor’s authorized representative.
2.6 Changes in the Work. No change, addition, or deletion shall be binding unless set forth in a Change Order signed by both Parties, identifying adjustments to the Contract Price and/or schedule.
2.7 Subcontractors. Contractor may only engage subcontractors approved in writing by Owner. Contractor remains fully responsible for the acts and omissions of all subcontractors.
2.8 Compliance with Laws; Safety. Contractor shall comply with all Applicable Law and shall be solely responsible for site safety.

3. CONTRACT PRICE, PAYMENT, RETAINAGE & LIEN COMPLIANCE

3.1 Contract Price. Owner shall pay Contractor the lump-sum price of [AMOUNT IN WORDS] Dollars ($[AMOUNT]) (the “Contract Price”), subject to adjustment pursuant to Section 2.6.

3.2 Schedule of Values. Contractor shall submit, for Owner’s approval, a schedule allocating the Contract Price to portions of the Work.

3.3 Progress Payments.
a. Application. On or before the [DAY] of each month, Contractor shall submit an Application for Payment for Work performed to date, supported by documentation reasonably required by Owner.
b. Certification & Payment. Subject to lien waiver compliance (Section 3.6), Owner shall pay approved amounts within [NUMBER] days.

3.4 Retainage. Owner shall withhold retainage not exceeding five percent (5%) of each Progress Payment (“Retainage”) in compliance with Rhode Island prompt-pay/retainage statutes. Retainage shall be released within [30] days after Completion, less amounts properly withheld for punch-list or disputed work.

3.5 Final Payment. Final payment of the unpaid balance of the Contract Price, including Retainage, shall be due after (i) written certification of Completion, (ii) delivery of final lien waivers and affidavits, (iii) completion of all punch-list items, and (iv) receipt of all close-out documents listed in Exhibit B.

3.6 Lien Rights & Notices.
a. Lien Preservation. Contractor acknowledges the statutory requirement to serve a Notice of Possible Mechanic’s Lien and, if necessary, a Notice of Intent to Lien in accordance with R.I. Gen. Laws § 34-28-1 et seq., within the time periods prescribed by law.
b. Lien Waivers. As a condition precedent to each payment, Contractor shall deliver lien waivers in the form reasonably required by Owner from Contractor, subcontractors, and suppliers for Work covered by the preceding payment.
c. Discharge of Liens. Contractor shall promptly discharge (by payment, bond, or other means) any mechanic’s or materialman’s lien filed against the Project arising out of the Work, at Contractor’s sole cost and expense.

3.7 Right to Withhold. Owner may withhold amounts necessary to cover (i) defective Work not remedied, (ii) third-party claims, (iii) failure to make payments to subcontractors, or (iv) documented offsets.

4. SCHEDULE & MILESTONES

4.1 Commencement. Contractor shall commence the Work on [START DATE] (“Commencement Date”).
4.2 Substantial Completion. Contractor shall achieve Substantial Completion no later than [SUBSTANTIAL COMPLETION DATE].
4.3 Final Completion. Final Completion shall occur within [NUMBER] days after Substantial Completion.
4.4 Certification. Substantial and Final Completion shall be certified in writing by [ARCHITECT/ENGINEER OR OWNER].
4.5 Liquidated Damages. If Contractor fails to achieve Substantial Completion by the date in Section 4.2, Contractor shall pay Owner liquidated damages of [$/DAY] per calendar day, not as a penalty but as a reasonable estimate of Owner’s damages.
[// GUIDANCE: Insert bonus provisions for early completion if desired.]

5. PERMITS, LICENSES & CODES

5.1 Permits. Contractor shall obtain and pay for all permits, licenses, inspections, and fees necessary to perform the Work, except as expressly identified in Exhibit C as Owner-provided.
5.2 Codes & Standards. All Work shall comply with the Rhode Island State Building Code, fire codes, OSHA regulations, and other Applicable Law.

6. REPRESENTATIONS & WARRANTIES

6.1 Contractor’s Representations. Contractor represents and warrants that:
a. It is duly organized, validly existing, and in good standing under the laws of its state of organization;
b. It is licensed and qualified to perform the Work in Rhode Island;
c. It possesses the skill, experience, and resources to perform the Work in accordance with the Contract Documents; and
d. The Work will be free from defects in materials and workmanship for a period of [ONE] year after Completion (“Warranty Period”).

6.2 Owner’s Representations. Owner represents and warrants that it has title to the Site and full authority to contract for the Work.

6.3 Survival. The warranties in this Section 6 survive Completion and any termination of this Agreement.

7. COVENANTS

7.1 Affirmative Covenants of Contractor. Contractor shall:
a. Maintain competent supervision on Site;
b. Keep the Site free from accumulation of waste;
c. Maintain the insurance and bonds required herein;
d. Provide weekly written status reports to Owner; and
e. Comply with all lawful instructions of Owner and its design professionals.

7.2 Negative Covenants. Contractor shall not:
a. Assign this Agreement or any monies due without Owner’s prior written consent;
b. Permit any hazardous materials to be brought onto the Site except as necessary and in compliance with Applicable Law;
c. Cause or allow any labor dispute that interferes with the Project schedule.

8. INSURANCE & BONDS

8.1 Contractor’s Insurance. Contractor shall maintain, at its own expense:
a. Commercial General Liability – $[2,000,000] per occurrence/$[4,000,000] aggregate;
b. Automobile Liability – $[1,000,000] combined single limit;
c. Workers’ Compensation – Statutory limits and Employer’s Liability of $[1,000,000];
d. Builders’ Risk – Full replacement cost of the Work (if required per Exhibit D).

8.2 Payment Bond. If the Contract Price exceeds [STATUTORY THRESHOLD] or if otherwise required by Owner, Contractor shall, within [10] days after execution, furnish a payment bond complying with R.I. Gen. Laws § 37-12-1 et seq., in the full amount of the Contract Price, with a surety acceptable to Owner.
[// GUIDANCE: For privately financed projects, Owner may waive or adjust bond requirements.]

9. INDEMNIFICATION

9.1 Contractor Indemnity. To the fullest extent permitted by law, Contractor shall defend, indemnify, and hold harmless Owner, its affiliates, and their respective officers, directors, agents, and employees from and against any and all claims, damages, losses, costs, and expenses (including reasonable attorneys’ fees) arising out of or relating to:
a. Bodily injury, sickness, disease, or death;
b. Property damage, including loss of use;
c. Mechanic’s or materialmen’s liens or bond claims; or
d. Violation of Applicable Law,
to the extent caused by the negligence, recklessness, or willful misconduct of Contractor, its subcontractors, or anyone for whom Contractor is responsible.

9.2 No Limitation. The foregoing indemnity is in addition to, and not in lieu of, any other remedies available to Owner.

10. LIMITATION OF LIABILITY

10.1 Cap. Except for (i) indemnity obligations under Section 9, (ii) Contractor’s gross negligence or willful misconduct, and (iii) claims covered by insurance, Contractor’s total aggregate liability to Owner arising out of this Agreement shall not exceed the Contract Price.
10.2 Consequential Damages. Neither Party shall be liable to the other for incidental or consequential damages, including lost profits, except as may be recoverable under Section 11.4 for third-party claims.

11. EVENTS OF DEFAULT & REMEDIES

11.1 Contractor Default. The following constitute a Contractor Event of Default:
a. Failure to perform the Work diligently or in accordance with the schedule and not cured within [7] days of notice;
b. Failure to pay subcontractors or suppliers when due;
c. Filing of a voluntary or involuntary bankruptcy petition;
d. Material breach of any covenant, warranty, or representation not cured within [10] days of notice.

11.2 Owner Default. Owner’s failure to make undisputed payments within [30] days after written notice constitutes an Owner Event of Default.

11.3 Cure Periods. Cure periods run concurrently with any statutory notice requirements.

11.4 Remedies. Upon an uncured Event of Default, the non-defaulting Party may:
a. Suspend performance;
b. Terminate this Agreement;
c. Seek specific performance or injunctive relief;
d. Recover damages, including reasonable attorneys’ fees and costs as the prevailing party.

11.5 Set-Off. Owner may set off any amounts due from Contractor against sums otherwise payable.

12. FORCE MAJEURE

Neither Party shall be liable for delays caused by events beyond its reasonable control, including acts of God, terrorism, epidemics, or governmental orders, provided the affected Party gives written notice within [3] days of the event and resumes performance promptly thereafter. The schedule shall be equitably adjusted.

13. DISPUTE RESOLUTION

13.1 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Rhode Island, without regard to conflict-of-laws principles.

13.2 Forum Selection. All actions arising out of this Agreement shall be brought exclusively in the state courts situated in [COUNTY], Rhode Island.

13.3 Arbitration (Optional).
[SELECT ONE – DELETE THE OTHER OPTION PRIOR TO EXECUTION]
OPTION A – Binding Arbitration: Any dispute shall be resolved by binding arbitration administered by the American Arbitration Association in Providence, Rhode Island, under its Construction Industry Arbitration Rules. Judgment may be entered on the award.
OPTION B – No Arbitration: Disputes shall be resolved solely in the state courts designated in Section 13.2.

13.4 Jury Trial Waiver (Optional). If permitted by Applicable Law, each Party hereby waives its right to a jury trial in any litigation arising out of this Agreement.

13.5 Injunctive Relief. Notwithstanding the foregoing, either Party may seek temporary, preliminary, or permanent injunctive relief in any court of competent jurisdiction to protect its interests.

14. GENERAL PROVISIONS

14.1 Amendments & Waivers. No amendment or waiver is effective unless in writing and signed by the Party against whom enforcement is sought. A waiver on one occasion is not a waiver of any subsequent breach.

14.2 Assignment. Contractor may not assign this Agreement without Owner’s prior written consent. Any attempted assignment in violation hereof is void.

14.3 Successors & Assigns. This Agreement binds and benefits the Parties and their permitted successors and assigns.

14.4 Severability. If any provision is invalid, illegal, or unenforceable, the remaining provisions shall remain in full force, and the invalid provision shall be reformed to the minimum extent necessary.

14.5 Integration. This Agreement, including all Contract Documents, constitutes the entire agreement of the Parties and supersedes all prior discussions, negotiations, or agreements.

14.6 Counterparts; Electronic Signatures. This Agreement may be executed in counterparts, each of which is deemed an original, and signatures delivered electronically (e.g., PDF, DocuSign) shall be effective.

14.7 Notice. All notices shall be in writing and delivered (i) personally, (ii) by certified mail, return receipt requested, (iii) by nationally recognized overnight courier, or (iv) by email with confirmation of receipt, to the addresses set forth below (or as later modified by notice). Notices are effective upon receipt.

14.8 Confidentiality. Contractor shall keep proprietary information of Owner confidential and use it solely for performance of the Work.

14.9 No Third-Party Beneficiaries. Except as expressly provided, nothing herein confers any rights on any person other than the Parties.

15. EXECUTION

IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be executed as of the Effective Date.

OWNER:
[OWNER LEGAL NAME]

By: _____
Name: ____
Title: _____
Date: ____

CONTRACTOR:
[CONTRACTOR LEGAL NAME]

By: _____
Name: ____
Title: _____
Date: ____

[// GUIDANCE: Notarization is not generally required for enforceability in Rhode Island, but may be added if the Agreement or lender requires. Add witness lines if desired.]

16. EXHIBITS

Exhibit A – Drawings & Specifications
Exhibit B – Close-Out Documentation Requirements
Exhibit C – Owner-Provided Permits & Items
Exhibit D – Insurance Requirements (Builders’ Risk, etc.)
Exhibit E – Schedule of Values & Payment Application Form
Exhibit F – Form of Conditional / Unconditional Lien Waiver
Exhibit G – Form of Payment Bond (if required)

[// GUIDANCE:
1. Verify statutory citations and dollar thresholds before finalizing; Rhode Island law currently requires payment bonds on certain public projects exceeding $50,000—adjust for private projects per Owner’s risk tolerance.
2. Confirm Prompt Payment Act retainage limitations (presently capped at 5%) remain unchanged at execution.
3. Coordinate insurance limits with Owner’s risk manager and lender requirements.
4. Review arbitration and jury waiver options for client preference and enforceability under current Rhode Island jurisprudence.
5. Ensure all blanks and bracketed items are completed before signing.]