15 Issues Every Construction Contract Must Have When Building or Remodeling Your Church, Synagogue or Temple
15 Issues Every Construction Contract Must Have When Building or Remodeling Your Church, Synagogue or Temple.
- All contracts must be in writing. Repeat after me – ALL CONTRACTS MUST BE IN WRITING! In a court of law it must be in writing to be enforceable.
- The contract must have the full address of the property where the work will be completed. If you are building a church, you must be able to describe the parcel upon which the church is to be built. Use the tax map and parcel number, or the legal description, the street address or some other way of explaining to the world that the church is to be constructed HERE!
- The name, address and telephone number of the party hiring the contractor. Normally the church’s mailing address and the name of the minister or property chairperson signing the contract is sufficient.
- The contracting firm’s legal name, address and telephone number. Not that it is required, but this is a great place to insert the contractor’s license number if one is required in your state.
- A detailed description of the work to be completed along with detailed plans, sketches and specifications of all materials, finishes and furnishings to be used or installed. If you are working from architectural drawings, a reference in the contract to the architecture specifications and detailed drawings attached to this contract will do.
- A clause stating that the work will conform to the requirements of all applicable building, life and safety codes.
- Start and completion dates. Make sure all parties understand the expectations of the others when it comes to dates. Do you want the project to be finished for August 1 or do you want to be able to use the building by August 1, even if some finishing touches are being completed. Spell out your requirements in the contract.
- The price and payment scheduled to be followed. Let the contractor know how much you are paying for the work that will be completed, how you are paying for the work – in phases, weekly, upon completion, and when it gets paid. In many contracts it is common see language that states that invoices submitted by the 25th of the month will be reviewed and paid by the 10th of the following month. Vagueness is not your friend here – give details.
- Does invoices need to be approved by a project manager or architect prior to being submitted for payment? If so, when does it need to be submitted and when would the payment be expected?
- Agreement as to who (contractor or others) is responsible for all necessary permits, licenses, inspections and certificates. Again, vagueness is not good, spell it out.
- A written warranty on the contractor supplied work and materials in addition to manufacturer’s warranties for a period of at least one year.
- A provision allowing the “Buyer” to holdback an agreed amount of retainage for specific period of time to insure the work will be completed according to the contract and in a good and workmanlike manner. It is not uncommon to hold back 10% of each month’s progress payment until project is completed. If the work is not done to specification, the retainage can be used to correct the problem.
- A clause stating how change order to the specified work will be addressed.
- A clause specifying how disputed will be rectified. Court Action, Arbitration or Mediation.
- The signature page – it is not a valid contract if all parties do not sign it. It is a great idea to include the date of signature for all parties. The contract is valid upon the last to sign.