Residential Construction Contract

RESIDENTIAL CONSTRUCTION CONTRACT

TABLE OF CONTENTS

1. Parties and Project Information
2. Definitions
3. Scope of Work
4. Contract Documents
5. Contract Price and Payment Terms
6. Commencement and Completion
7. Change Orders
8. Owner's Responsibilities
9. Contractor's Responsibilities
10. Subcontractors and Suppliers
11. Permits and Inspections
12. Insurance Requirements
13. Warranties
14. Default and Remedies
15. Dispute Resolution
16. Lien Waivers
17. Termination
18. General Provisions
19. Notice of Right to Cancel
20. Execution

1. PARTIES AND PROJECT INFORMATION

RESIDENTIAL CONSTRUCTION CONTRACT (this "Contract") is made and entered into as of [Effective Date] (the "Effective Date") by and between:

OWNER:
Name: [Owner Full Legal Name]
Address: [Owner Address]
Phone: [Owner Phone]
Email: [Owner Email]

CONTRACTOR:
Company Name: [Contractor Legal Name]
Contractor License Number: [License Number]
License Expiration Date: [Expiration Date]
Address: [Contractor Address]
Phone: [Contractor Phone]
Email: [Contractor Email]

PROJECT PROPERTY:
Address: [Property Street Address]
Legal Description: [Legal Description or "See Exhibit A"]
City: [City] State: [State] Zip: [Zip Code]

2. DEFINITIONS

"Applicable Law" means all federal, state, and local laws, ordinances, codes, regulations, and requirements applicable to the Work, including building codes, zoning requirements, and licensing requirements.

"Change Order" means a written modification to this Contract signed by both Owner and Contractor, adjusting the Scope of Work, Contract Price, or Project Schedule.

"Completion Date" means the date specified in Section 6 for Substantial Completion of the Work, as may be extended by approved Change Orders.

"Contract Documents" means this Contract, all exhibits, the Plans and Specifications, approved Change Orders, and any other documents incorporated by reference.

"Contract Price" means the total amount to be paid by Owner to Contractor for the Work, as specified in Section 5.

"Force Majeure" means acts of God, natural disasters, war, terrorism, civil unrest, strikes, government actions, pandemics, material shortages, or other causes beyond Contractor's reasonable control.

"Plans and Specifications" means the architectural plans, engineering drawings, specifications, and other construction documents attached as Exhibit B or incorporated by reference.

"Punch List" means a list of minor items to be completed or corrected after Substantial Completion.

"Retainage" means the percentage of each progress payment withheld by Owner until Final Completion.

"Substantial Completion" means the stage when the Work is sufficiently complete in accordance with the Contract Documents so Owner can occupy or utilize the Work for its intended purpose.

"Work" means all labor, materials, equipment, and services required to complete the project as described in the Scope of Work and Contract Documents.

3. SCOPE OF WORK

3.1 Description of Work

Contractor agrees to furnish all labor, materials, equipment, and services necessary to construct and complete the following:

[Detailed description of construction project, including:

• Type of construction (new home, addition, etc.)
• Square footage
• Number of stories
• Number of bedrooms/bathrooms
• Major features and finishes
• Site work included]

3.2 Detailed Scope

The detailed Scope of Work is set forth in Exhibit A attached hereto and incorporated by reference.

3.3 Work Not Included

The following items are expressly excluded from this Contract unless specifically stated in Exhibit A:

• ☐ Landscaping and irrigation
• ☐ Fencing
• ☐ Driveways and walkways beyond [specify]
• ☐ Furniture, fixtures, and equipment not permanently installed
• ☐ Window treatments
• ☐ Security systems
• ☐ Low-voltage wiring beyond [specify]
• ☐ Appliances (except: [list included appliances])
• ☐ [Other exclusions]

3.4 Allowances

The Contract Price includes the following allowances:

Actual costs exceeding allowances will be added to the Contract Price; savings will be credited to Owner.

4. CONTRACT DOCUMENTS

4.1 Order of Precedence

In case of conflict between Contract Documents, the following order of precedence applies:

1. Executed Change Orders (most recent first)
2. This Contract
3. Plans and Specifications
4. Other exhibits and attachments

4.2 Incorporated Documents

The following documents are incorporated by reference:

• ☐ Exhibit A: Detailed Scope of Work
• ☐ Exhibit B: Plans and Specifications
• ☐ Exhibit C: Payment Schedule
• ☐ Exhibit D: Material Selections
• ☐ Exhibit E: Subcontractor List (if applicable)

5. CONTRACT PRICE AND PAYMENT TERMS

5.1 Contract Price

Owner agrees to pay Contractor the total sum of:

$[Contract Price] ([Amount in Words] Dollars)

5.2 Payment Type

☐ Fixed Price/Lump Sum - The Contract Price is a fixed amount for all Work described herein.

☐ Cost Plus Fee - See Section 5.6 for Cost Plus provisions.

5.3 Payment Schedule

Payments shall be made according to the following schedule:

5.4 Retainage

Owner shall retain [5-10]% of each progress payment as Retainage until Final Completion. Retainage shall be released within [10] days after Final Completion and delivery of all lien waivers.

5.5 Payment Terms

• Contractor shall submit itemized invoices/applications for payment.
• Owner shall pay undisputed amounts within [10] days of invoice receipt.
• Late payments accrue interest at [1.5]% per month or the maximum rate permitted by law, whichever is less.
• Owner may dispute amounts in writing within [7] days of invoice receipt, specifying the basis for dispute.

5.6 Cost Plus Provisions (If Applicable)

• Contractor's Fee: [___]% of Cost of Work, OR $[___] fixed fee
• Guaranteed Maximum Price (GMP): $[Amount] (if applicable)
• Cost of Work includes: Labor, materials, subcontracts, equipment rental, permits, insurance allocable to project
• Cost of Work excludes: Contractor's home office overhead, profit (included in fee)
• Documentation: Contractor shall maintain detailed records and provide monthly cost reports
• Audit Rights: Owner may audit Contractor's project records upon reasonable notice

6. COMMENCEMENT AND COMPLETION

6.1 Commencement Date

Work shall commence on [Start Date] or within [___] days after:

• ☐ Receipt of building permit
• ☐ Receipt of initial deposit
• ☐ Owner approval of final Plans and Specifications
• ☐ [Other condition precedent]

6.2 Substantial Completion

Contractor shall achieve Substantial Completion on or before [Completion Date] ("Scheduled Completion Date").

6.3 Final Completion

Final Completion shall occur within [30] days after Substantial Completion.

6.4 Time Extensions

Contractor is entitled to an extension of the Completion Date for delays caused by:

• Change Orders approved by Owner
• Force Majeure events
• Owner-caused delays
• Concealed conditions not reasonably discoverable
• Unusually severe weather documented by Contractor

Contractor shall provide written notice of delay within [5] business days of occurrence.

6.5 Liquidated Damages (Optional)

☐ Applicable: If Substantial Completion is not achieved by the Completion Date (as extended), Contractor shall pay Owner $[Amount] per calendar day as liquidated damages, not as a penalty. Maximum liquidated damages: $[Amount] or [___]% of Contract Price.

☐ Not Applicable: Liquidated damages do not apply to this Contract.

7. CHANGE ORDERS

7.1 Written Change Orders Required

No changes to the Scope of Work, Contract Price, or Completion Date shall be effective unless set forth in a written Change Order signed by both parties.

7.2 Change Order Process

1. Either party may request a change in writing
2. Contractor shall provide a written proposal within [5] business days including:
   - Description of changed work
   - Cost impact (itemized)
   - Schedule impact
   - Effect on other work
3. Owner shall approve or reject within [5] business days
4. Work on changes shall not commence until Change Order is fully executed

7.3 Pricing of Changes

Changes shall be priced using one of the following methods:

• Lump sum agreed upon by both parties
• Unit prices established in Contract Documents
• Time and materials at rates: Labor $[___]/hour plus materials at cost plus [___]% markup
• Subcontractor quotes plus [___]% markup

7.4 Disputed Changes

If parties cannot agree on Change Order terms but Owner directs Contractor to proceed, Contractor shall perform the work under protest and reserves all rights to dispute pricing through the dispute resolution process.

8. OWNER'S RESPONSIBILITIES

Owner shall:

• ☐ Provide access to the Property during normal working hours
• ☐ Obtain Owner-required approvals (HOA, etc.)
• ☐ Make timely decisions on material selections (within [___] days of request)
• ☐ Pay invoices when due
• ☐ Provide accurate information about property conditions
• ☐ Obtain and pay for Owner-supplied items, if any
• ☐ Not interfere with Contractor's work or direct subcontractors
• ☐ Maintain property insurance during construction
• ☐ [Other Owner responsibilities]

9. CONTRACTOR'S RESPONSIBILITIES

9.1 General Duties

Contractor shall:

• ☐ Perform Work in a good and workmanlike manner
• ☐ Comply with all Applicable Laws and building codes
• ☐ Obtain and pay for all required permits (unless otherwise specified)
• ☐ Schedule and coordinate all inspections
• ☐ Supervise and direct the Work
• ☐ Maintain a clean and safe job site
• ☐ Protect Owner's property and adjacent properties
• ☐ Employ qualified workers and licensed subcontractors
• ☐ Provide required lien waivers with each payment application

9.2 Subcontractor Disclosure

☐ Subcontractors will be used: Yes / No

If subcontractors will perform more than 50% of estimated project cost, subcontractor information:

9.3 Project Communication

Contractor shall designate the following as primary contact:

Name: [Project Manager Name]
Phone: [Phone]
Email: [Email]

Contractor shall provide Owner with weekly progress updates by [method: email/phone/meeting].

10. SUBCONTRACTORS AND SUPPLIERS

10.1 Selection

Contractor may engage subcontractors and suppliers as Contractor deems appropriate. Major subcontractors shall be properly licensed where required by law.

10.2 Contractor Responsibility

Contractor is fully responsible for acts, omissions, and defaults of all subcontractors and suppliers.

10.3 No Direct Relationship

Nothing in this Contract creates any contractual relationship between Owner and any subcontractor or supplier.

10.4 Subcontractor Payments

Contractor shall pay subcontractors within [7] days of receiving payment from Owner for their work.

11. PERMITS AND INSPECTIONS

11.1 Permits

Contractor shall obtain all permits required for the Work, including:

• Building permit
• Electrical permit
• Plumbing permit
• Mechanical/HVAC permit
• [Other required permits]

Permit costs are ☐ included in / ☐ in addition to the Contract Price.

11.2 Inspections

Contractor shall schedule all required inspections and shall not cover or conceal work requiring inspection until approved by the inspector.

11.3 Code Compliance

Contractor shall perform all Work in compliance with applicable building codes. If code requirements conflict with Plans and Specifications, Contractor shall notify Owner before proceeding.

12. INSURANCE REQUIREMENTS

12.1 Contractor's Insurance

Contractor shall maintain throughout the Project:

12.2 Additional Insured

Owner shall be named as additional insured on Contractor's Commercial General Liability policy.

12.3 Certificates

Contractor shall provide certificates of insurance prior to commencing Work and upon request.

12.4 Owner's Insurance

Owner shall maintain homeowner's insurance on the existing structure and shall obtain appropriate coverage for the construction project if required by Owner's lender.

13. WARRANTIES

13.1 Contractor's Warranty

Contractor warrants to Owner that:

• All Work will be performed in a good and workmanlike manner
• All materials will be new and of good quality unless otherwise specified
• The Work will conform to the Plans and Specifications
• The Work will be free from defects in materials and workmanship

13.2 Warranty Period

Contractor's warranty shall remain in effect for [One (1) Year] from the date of Substantial Completion ("Warranty Period").

13.3 Warranty Exclusions

This warranty does not cover:

• Normal wear and tear
• Damage caused by Owner's misuse, neglect, or failure to maintain
• Damage caused by others after Substantial Completion
• Items covered by manufacturers' warranties
• Conditions caused by settlement, soil movement, or other site conditions beyond Contractor's control
• Cosmetic issues not reported within 30 days of Substantial Completion

13.4 Warranty Service

During the Warranty Period, Contractor shall repair or replace defective Work at no cost to Owner. Contractor shall respond to warranty claims within [5] business days and complete repairs within a reasonable time.

13.5 Manufacturer Warranties

Contractor shall assign to Owner all manufacturers' warranties for materials, equipment, and appliances incorporated in the Work. Major warranties include:

14. DEFAULT AND REMEDIES

14.1 Contractor Default

Contractor is in default if Contractor:

• Fails to perform Work in accordance with Contract Documents
• Fails to make timely payments to subcontractors or suppliers
• Fails to maintain required insurance
• Abandons the Work
• Becomes insolvent or files for bankruptcy
• Materially breaches any provision of this Contract

14.2 Owner's Remedies

Upon Contractor default, Owner may, after [10] days' written notice and opportunity to cure:

• Withhold payment
• Correct deficiencies using other contractors and deduct costs from amounts owed
• Terminate this Contract
• Pursue all legal remedies

14.3 Owner Default

Owner is in default if Owner:

• Fails to make payments when due
• Fails to provide required approvals or information causing material delay
• Materially breaches any provision of this Contract

14.4 Contractor's Remedies

Upon Owner default, Contractor may:

• Stop Work after [7] days' written notice
• Suspend Work until payment is received (with right to extend Completion Date)
• Terminate this Contract after [14] days' written notice if default is not cured
• Pursue all legal remedies including mechanic's lien rights

15. DISPUTE RESOLUTION

15.1 Negotiation

The parties shall attempt in good faith to resolve any dispute through direct negotiation for [15] days before pursuing other remedies.

15.2 Mediation

If negotiation fails, either party may demand mediation. Mediation shall be conducted by a mutually agreed mediator or, if parties cannot agree, by a mediator selected by [local bar association/AAA/other]. Mediation costs shall be shared equally.

15.3 Arbitration (Optional)

☐ Binding Arbitration Applies: Any dispute not resolved through mediation shall be settled by binding arbitration under the rules of [American Arbitration Association/JAMS/other]. The arbitrator's decision is final and binding. Judgment may be entered in any court of competent jurisdiction.

☐ Arbitration Does Not Apply: Disputes not resolved through mediation may be pursued in court.

15.4 Governing Law

This Contract is governed by the laws of the State of [State].

15.5 Venue

Any litigation shall be brought in the state or federal courts located in [County, State].

15.6 Attorney's Fees

The prevailing party in any dispute is entitled to recover reasonable attorney's fees, costs, and expenses.

15.7 Limitation on Actions

Any claim arising from this Contract must be commenced within [applicable statute of limitations - typically 4-10 years depending on jurisdiction] after Substantial Completion.

16. LIEN WAIVERS

16.1 Lien Waiver Requirements

As a condition of payment, Contractor shall provide:

• With each progress payment application: Conditional lien waivers from Contractor and all subcontractors/suppliers for the current payment period
• Upon receiving each payment: Unconditional lien waivers from Contractor and all subcontractors/suppliers for the amount paid
• At Final Payment: Final unconditional lien waivers from all parties

16.2 Form of Lien Waivers

Lien waivers shall be in the form required by Applicable Law or, if no statutory form exists, in the form attached as Exhibit F.

16.3 Title Protection

Contractor shall keep the Property free from mechanic's liens and claims. If any lien is filed, Contractor shall remove it within [15] days by payment, bond, or other lawful means.

17. TERMINATION

17.1 Termination for Convenience

Owner may terminate this Contract for convenience upon [14] days' written notice. Upon such termination, Owner shall pay Contractor for:

• All Work performed through termination date
• Materials ordered or delivered
• Reasonable demobilization costs
• [___]% of remaining Contract Price as termination fee (negotiable)

17.2 Termination for Cause

Either party may terminate for cause as provided in Section 14.

17.3 Contractor's Duties Upon Termination

Upon termination, Contractor shall:

• Stop Work except as directed to protect completed Work
• Cancel orders for materials not yet delivered
• Assign to Owner (at Owner's option) subcontracts and material orders
• Remove equipment, tools, and temporary structures
• Deliver all completed Work, materials, and documents to Owner

18. GENERAL PROVISIONS

18.1 Entire Agreement

This Contract, together with all exhibits and Contract Documents, constitutes the entire agreement between the parties and supersedes all prior negotiations, representations, or agreements.

18.2 Amendments

This Contract may only be amended by written Change Order signed by both parties.

18.3 Severability

If any provision is found invalid or unenforceable, the remaining provisions remain in full force.

18.4 Waiver

Failure to enforce any provision does not waive the right to enforce it later.

18.5 Assignment

Neither party may assign this Contract without the other's written consent, except Contractor may assign payment rights.

18.6 Notices

All notices shall be in writing and delivered by hand, certified mail, overnight courier, or email with confirmation to the addresses in Section 1.

18.7 Independent Contractor

Contractor is an independent contractor, not an employee, agent, or partner of Owner.

18.8 Headings

Headings are for convenience only and do not affect interpretation.

18.9 Counterparts

This Contract may be executed in counterparts, including electronic signatures, each of which is an original.

19. NOTICE OF RIGHT TO CANCEL

NOTICE TO OWNER

You, the Owner, have the right to cancel this Contract within [3] business days after signing. To cancel, mail or deliver a written notice to the Contractor at the address above. If you cancel, the Contractor must return any payments within [10] days.

20. EXECUTION

THE UNDERSIGNED HAVE READ, UNDERSTAND, AND AGREE TO ALL TERMS OF THIS CONTRACT.

OWNER:

CONTRACTOR:

EXHIBITS

Exhibit A: Detailed Scope of Work

[Attach detailed scope of work, construction specifications, and material descriptions]

Exhibit B: Plans and Specifications

[Attach or reference architectural plans, engineering drawings, and specifications]

Exhibit C: Payment Schedule

[Attach detailed payment schedule if different from Section 5.3]

Exhibit D: Material Selections

[Attach material selection sheets, allowance specifications, and finish schedules]

Exhibit E: Subcontractor List

[Attach list of major subcontractors, if applicable]

Exhibit F: Lien Waiver Forms

[Attach conditional and unconditional lien waiver forms]

CONTRACTOR'S DISCLOSURE STATEMENT

Contractor certifies:

• ☐ Contractor holds a valid state contractor's license as indicated above
• ☐ Contractor maintains workers' compensation insurance (or is exempt under law)
• ☐ Contractor maintains general liability insurance
• ☐ Contractor will obtain all required permits
• ☐ Contractor has not had a license suspended or revoked in the past [5] years

NOTICE: You are entitled to a completely filled-in copy of this Contract, signed by both you and the Contractor, before any work begins.