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tthomass
12-28-2008, 04:05 PM
I know a lot of people hoo and ha over their contracts but a lot of my contract was put together from gathering information from others and my own input. I have more things to add to it but I am hoping that this thread can be used as a helpful tool for all of us to revise our contracts and better protect ourselves. I encourage others to post comments, recommendations, their own terms and anything HELPFUL.

...................................................................................................

Contract Terms
1. A 50% deposit is required on all jobs. The balance is due the day the work is completed.
2. Payment is required when job is completed, unless there is a written agreement otherwise.
3. Interest will be charged at the rate of 1.5% per month for all unpaid amounts after 30 days from date of work.
4. Any collection costs or attorneys fees required to enforce payment will be paid for by the property owner or person authorizing work. Such persons specifically waive all rights under mechanic lien laws. Legal fee minimum of $500 will be assessed automatically.
5. For any complaints, notification must be in writing within 7 days of the work. Failure to provide such notice waives any right to an adjustment.
6. Customer is responsible for advising the Contractor on the location of underground utility lines and other items susceptible to damage, including underground wires, cable, pipe etc., that cannot be seen or do not meet building code requirements.
7. Rock Water Farm will not be held responsible for damages to private utilities including, but not limited to, irrigation systems, invisible dog fences, gas lines, electric lines etc.
8. In lieu of a formal signature, verbal authorization and subsequent performance of work is considered acceptance of this contract and these terms.
9. This is a severable contract and payment must be made for individual items if for any reason the contract is not completed in its entirety.
10. If the nature of the work may reasonably require access to a neighbor’s property, it is the responsibility of the property owner to secure this permission and to advise Contractor of the specific boundary lines.
11. Customer warrants that he is the owner or has the authority to authorize the work.
12. After installation, proper watering is the responsibility of the client.
13. Occasionally, unforeseeable underground obstructions occur. Rock Water Farm shall be paid for the removal of the obstruction at a flat rate, or at the hourly rate of $50 per man hour.
14. After work is completed, the job site will be left broom-clean.
15. All work to be performed is specific in this contract. Additional work will be performed only by mutual consent of both parties and at an additional charge.
16. All plants shall be free of disease and insect pests.
17. All plants shall conform to the measurement specified on the front page.
18. When plants or other material are not available, the contractor may make substitutions, with client’s approval, using plants or materials that are similar in size and cost.
19. Estimate prices are good for 30 days unless otherwise stated.
20. On all time and material jobs, there will be a “one way” charge for travel time.
21. If underground obstructions are found on excavation, clearing and dirt work jobs requiring use of heavy equipment (i.e. rocks, buried debris, logs) a “rock or equipment abuse” clause will go into effect doubling the charge due to extra time and wear on machinery.
22. When seeding is done the customer is responsible for watering at recommended intervals twice a day as needed to insure seedling growth. Rock Water Farm will not be responsible for death after germination due to lack of water.
23. Rock Water Farm will not be held responsible for theft of any material from the jobsite at any point in time.
24. Stone is a natural product possessing uneven shapes, textures and color differences beyond the control of Rock Water Farm.
25. A 2yr warranty is provided on masonry work against any major failures. Minor “hairline” cracks are not major failures.
26. All permits, bonds and engineering plans performing jobs described are the responsibility of the customer unless noted on contract.
27. Rock Water Farm is considered owner of all plants and materials until such time payment is received in full. Rock Water Farm reserves the right to reclaim all materials and plants not paid for in full after contract is completed.

Initial:____________ ____________
















Watering Instructions
Plants should be WATERED thoroughly once every 7-10 DAYS OR AS NEEDED. SOIL MOISTURE should be CHECKED by digging beside the root ball 4” to 6” deep BEFORE NEXT WATERING. If soil is still moist, do not water and check again in 3-5 days. Summer thunderstorms should not be counted as sufficient water. To water thoroughly, the water must be absorbed by the soil very slowly. The water hose should be laid next to each plant, turned down to a trickle and left to run for about 30 minutes on container stock and small burlap-wrapped plants. On large trees, the water should run 1 to 3 hours to insure a good deep watering. A soaker hose may be used in place of the hose when a new group of plants has been installed. Each soil has its own characteristics and should be watered accordingly. Rock Water Farm will not be held responsible for plants stressed from lack of water during periods of drought.

Guarantee
After jobs are completed and paid in full, shrubs and trees purchased from us are guaranteed for one year as follows: THOSE PLANTS PLANTED AND CARED FOR according to our instructions (see above) that fail to survive will be replaced with a credit of 100% of the original purchase price. All plants are only guaranteed one time and replacements will not be guaranteed. Plants used in other than their natural environment such as patio plants, bonsai, etc., will not be guaranteed. Plants that die because of lack of water, drowning, insects, disease or winter kill will not be replaced under the warranty. We do not guarantee annuals, roses, house plants, mums, perennials, ground cover, transplanted plantings, or grass seed, (stated in #22 above). Guarantee will not take affect until full payment for contracted plant material is paid for in full. *Payment not received within 30 days from completion of work voids all guarantees.

Acceptance of Work
I agree that Rock Water Farm Landscapes & Hardscapes Inc. has performed the work in this contract, and that it conforms with the provisions in the contract, unless otherwise noted below.


Clients signature __________________________________________________ Date _______________________

Summit L & D
12-28-2008, 06:05 PM
A couple of thoughts...

As I reviewed our current contract with our attorney, several things were brought to my attention. Regarding Mechanics Liens: they are VERY difficult enforce in court due to the complexities in PROPERLY filing them. Thus I don't really stress that point in the contract, we leave the door open for it, but just don't make a big deal about it.

Regarding number 8: I personally like the way it sounds, but again....does it really stand up in court? This is not something that I've talked to our attorney about, so I'd be interested to know just how well a "verbal" contract does.

I really like number 23. I was just discussing this issue with my insurance underwriter the other day.

Does anyone carry insurance on "work completed in an unfinished project"? For example: we plant 30 four inch caliper trees and vandals destroy them (I know, outside chance but....) I'd like to know that we'd be able to recoup the money on not only the trees but also the labor.

27 is also a good clause. You might also add something along the lines of: "Plant warranty begins at date of installation, but is not honored until final payment is received." You could also implement that clause in other areas regarding warranty fulfillment.

I know you spell out the conditions of your plant warranty, but one thing that we've stipulated is that in order for a warranty to be offered the customer must have an irrigation system for the plants. (In our area that is a drip irrigation system.) If they don't have one, I will have included it as an option in the proposal.

Good stuff overall!

tthomass
12-28-2008, 06:36 PM
In the state of VA a verbal contract is enforceable. It may only be one persons word vs another being the problem.

Homeowner's insurance should cover theft.

I like your wording for #27 better.

Looking at the plant warranty it "basically" says I'm bringing you a healthy plant. If you don't water there is no warranty nor is there with disease or insects. So, the warranty is peace of mind but also it "basically" says that if the plant dies its your fault.

STL Ponds and Waterfalls
12-29-2008, 08:29 PM
How do you guy's word and enforce your turf work. I'm talking about after you build a patio and do a grade and install sod or seed and straw.

DVS Hardscaper
12-29-2008, 08:56 PM
Our Turf Damage Clause:


All damages done to existing turf will be graded, seeded, and mulched with straw. Seeding will be performed up to the outside edges of the pavers where deemed necessary. Curlex (erosion control material) and sod are not included in the price listed below, however they may be used for additional charges, which will consist of materials and labor. Seeding will only be performed one time; watering and maintenance will be the responsibility of client.



Then, because in the fall and winter, we sometimes can not peform regrading / seeding because the soil is frozen or muddy. To avoid standing on the client's front porch arguing about how much they can keep as a retainer I have this line placed after the Agreement Amount. My estimating system automatically calculates the amount the client may retain and it automatically places it in the contract:

In the event that wet or frozen soil conditions shall prevent contractor from re-grading and seeding the disturbed turf areas, client will be responsible for paying the balance due upon completion of the proposed hardscape, however client may retain $249.00 until regrading and seeding is complete.

zedosix
12-29-2008, 10:22 PM
Thomas, your contract scares the hell outta me, and as a consumer I would look elsewhere for a contractor if you came to me looking to sign that!

For starters, are you serious 50% up front???, you've already shown that you don't trust your client, yet you want half up front before you start the job, secondly they have the right to withhold final payment for 30 days after completion. If you have any subcontractors working for you they have the right to withhold 10% for 45 days after completion just in case of construction liens put against their property if you don't pay your subs. Since when are locates the responsibility of the consumer, is that not the contractors responsibility?

I dunno, I mean good for you guys if thats what it takes to protect yourself, and if your clients agree to those terms then all the power to ya!

Summit L & D
12-29-2008, 10:46 PM
zedosix, I don't know if Canada practices are that much different, but even for us here in South Texas 50% upfront is common place.

After I typed my my last post I realized I forgot to ask another question. We've been doing a fair amount of projects that involve a significant amount of funds and on a more recent project we were left waiting for final payment until the client "gathered" up the money. So that got me to thinking that on projects totaling more than xx,xxx.xx dollars, I should have the client place the entire amount of the proposed project in an escrow account (or something similar). From that account the client could pull the project payments from, and we would also have the peace of mind knowing we weren't going to be left holding the bag at the end. I know our contract covers us for non payment, but I feel that this might add an extra layer of protection.

Thoughts?

tthomass
12-29-2008, 10:47 PM
Welcome to America! Yes, 50% before I set foot on your property and I don't care if the job is $5,000 or $50,000. Its not always 50% upon completion but to start its 50%. If they can't give me 50% down how do they expect to pay for it in the first place and if they don't give me 50% its not that they don't trust me, its that I don't trust them.

I don't use subs.

VA law, utilities are the responsibility of the property owner........been there with that lawsuit and won because my contract protected me. Much of this contract was written by a lawyer.

tthomass
12-29-2008, 10:49 PM
BTW, I'm hoping others will post their terms.......I see no reason not to at least do portions.

DVS Hardscaper
12-29-2008, 10:52 PM
Yeah, I'm not hip with the 50% down thing.

Many states dictate how payment is to be conducted.

In MD we can only "demand" up to 33.33%. And really, I'm comfortable with 1/3.

Like I have always said - "everyone is nice until it comes to money". I would never do a job where we finish and collect the remaining 50% at completion. And if there are change orders.....that 50% balance becomes 64%.

Thats scary. It's scary because if a conflict arises you could be out 50(+)%, plus attorney and court fees.

I icollect 33.33% upfront. I then taylor a draw schedule that is based on direct expenses. The higher my direct expenses....the more draws I collect as the job is performed.

I try to work the draw schedule so that at the end of the job, the client owes us $1500 to $3500, even on jobs that we do that are amounts in the 6 digits. This way, in conflict arises, we made our money and I can walk away and I can forget about the $1500 to $3500.

When a client has a balance of over 50% - you can't walk away from that! You're forced to go to court. That sucks because a) you do not know you'll win. b) If you do win, that doesn't mean you'll ever see the money c) the case could be drug on for years d) You'll have to pay your attorney a fortune

Keep the remaining balance low at the end of the job and you allivaite all I just mentioned above.

DVS Hardscaper
12-29-2008, 10:53 PM
Yeah, I'm not hip with the 50% down thing.

Many states dictate how payment is to be conducted.

In MD we can only "demand" up to 33.33%. And really, I'm comfortable with 1/3.

Like I have always said - "everyone is nice until it comes to money". I would never do a job where we finish and collect the remaining 50% at completion. And if there are change orders.....that 50% balance becomes 64%.

Thats scary. It's scary because if a conflict arises you could be out 50(+)%, plus attorney and court fees.

I icollect 33.33% upfront. I then taylor a draw schedule that is based on direct expenses. The higher my direct expenses....the more draws I collect as the job is performed.

I try to work the draw schedule so that at the end of the job, the client owes us $1500 to $3500, even on jobs that we do that are amounts in the 6 digits. This way, in conflict arises, we made our money and I can walk away and I can forget about the $1500 to $3500.

When a client has a balance of over 50% - you CAN'T walk away from that! You're forced to go to court. That sucks because a) you do not know you'll win. b) If you do win, that doesn't mean you'll ever see the money c) the case could be drug on for years d) You'll have to pay your attorney a fortune

Keep the remaining balance low at the end of the job and you allivaite all I just mentioned above.

CALandscapes
12-29-2008, 10:57 PM
Terms & Conditions
1. While we always try our best to avoid underground obstacles, Curb Appeal Landscapes, LLC will not be held responsible for any damages occurring to any underground objects, including (but not limited to) electrical lines, water/irrigation pipes, cable wires, phone lines, etc.
2. Customer is fully responsible for watering all installed living plant material (including turf grass).
3. No guarantee can or will be made for plant materials installed where there is not a permanent automatic irrigation system installed by Curb Appeal Landscapes, LLC.
If an automatic watering system is installed by Curb Appeal Landscape, LLC., warranties will apply as follows:
o Shrubs/perennials – 90 days
o Trees – 1 year
o Sod/annuals – 30 days
4. Curb Appeal Landscapes, LLC. is not responsible for loss of any plant material due to lack of water, neglect, theft, or acts of God.
5. This quotation includes all labor, material, taxes, tools, insurance, and transportation to install the system to meet or exceed industry standards.
6. The owner will provide adequate water supplies and electrical power for the automatic irrigation timer and lighting timer and identify all underground utilities and sleeves under walkways and driveways.
7. All labor and material for the lighting and irrigation systems is warranted for a period of one (1) year.
8. The balance of the job cost is due immediately upon completion of this job and presentation of the final bill.
9. In the event that it becomes necessary for Curb Appeal Landscapes, L.L.C. to employ an attorney for collection of any payments due under this contract, the customer will be responsible for the attorney’s fees, costs and expenses incurred.
10.This proposal is valid for 30 days from date issued.

I will definitely be "borrowing" some of the clauses from your contract, tthomas.

However, I don't want to get to the point where I'm offering clients 2+ pages of terms they must meet in order to use me as their contractor; like Zedo said, I'd hate to scare them away...

By the way, I copy & pasted this from one our landscape/irrigation/lighting contracts.. We do additionally offer a one year warranty on all hardscapes installed. I like your wording on the natural stone masonry work, though...

-Chase

CALandscapes
12-29-2008, 10:59 PM
DVS, mind posting the wording and layout of a typical draw schedule?

Thanks.

PatriotLandscape
12-29-2008, 11:01 PM
Here in mass it is against state law to get 50%. some do but if there is an issue with the court the court has issues with asking for that much. for a while we went with 3 payments of 1/3 each. on larger jobs it really messes with cashflow. anything over 20k now gets 30 deposit, 30 the day we start, 30 about half way, with 10 as the final. IMO getting 50 up front is only good until you start the job. then at the end you are exposed 50% on that job and what if they don't pay?

Digsafe here is mandatory for the contractor. If you hit a utility the state fines you and you pay the repair cost to the utility company.

I really like some of your ideas on the clauses though. Great post I may add some to our fine print.

PatriotLandscape
12-29-2008, 11:04 PM
I try to work the draw schedule so that at the end of the job, the client owes us $1500 to $3500, even on jobs that we do that are amounts in the 6 digits. This way, in conflict arises, we made our money and I can walk away and I can forget about the $1500 to $3500.


Exactly what we do. even if the job is 3 days it is worth the time to get seperate checks.

We also take credit cards and I try to get the card for the middle payments at least.

PatriotLandscape
12-29-2008, 11:08 PM
Payment Schedule: Deposit $2,682.
Remaining payments to be made as follows
Second payment of $2,682 due upon approval of Conservation Commission;
Third payment of $2,682 due upon completion of Cobble Edge and Apron;
Final payment of $894 due on last day of construction.

All work to be completed in a workmanlike manner according to standard practices. Any alteration or deviation from above specifications involving extra costs will be executed only upon written orders, and will become an extra charge over and above the estimate. All agreements are contingent upon accidents or delays beyond our control. Past due balances are subject to interest charges of one and a half percent per month. In the event Patriot Landscape is forced into litigation prompted by non-payment of contract, Patriot Landscape shall be entitled to full reimbursement of contract plus interest and reasonable legal expenses.
Note: This proposal may be withdrawn by us if not accepted within 14 days.

tthomass
12-29-2008, 11:14 PM
I don't take credit cards......checks.

The 50% down is at time of start. If I'm a month away from starting I may do say 25% and then another 25% the day we start........this way going in I have 50%. Smaller jobs I do 50% down and 50% in the end. I've YET (not that it won't ever happen) to get burned on them but it also comes down to me being comfortable with the person I'm dealing with. Larger jobs I do not do 50% and 50%......they are taken on a case by case. Heck, one designer I work with sends me 50% down often before getting a contract but this goes a lot to character and us knowing each other.

As I said, VA states notification of utilities being the responsibility of the owner.......that's just the legal talk. I am the one that calls to have them marked, not the owner.

tthomass
12-29-2008, 11:17 PM
Good term under the guarantee and I think I'm shortening it as well as specifically using the word "warranty" just so nobody can argue verbs:

*Payment not received within 30 days from completion of work voids all guarantees.

DVS Hardscaper
12-29-2008, 11:24 PM
My estimating system even assists with drawing up the draw schedule!
Our proposals typically state that another 33.33% is due the day we start. However, I almost never hold the client to that. I usually collect the 2nd payment after we have settled in and after noticable headway is made.

Here is a real draw schedule from a real job that was around $36k:

PAYMENT SCHEDULE - Client to submit payment(s) as follows:
• 1st Payment: Deposit of $12,046.00 (upon acceptance of this proposal)
• 2nd Payment: $12,046.00 paid on the day the work begins
• $1,500.00 paid upon completion of aggregate base installation for 'Patio A'
• $1,500.00 paid upon completion of fire pit construction
• $3,500.00 paid upon completion of bench wall construction
• $2,000.00 paid upon completion of aggregate base installation and step installation for 'Patio B'
• $2,000.00 paid upon completion of construction 'Patio B'
• Balance paid in full upon the day of completion



And here is a draw schedule from a small, profitable (gotta make it known that it was profitable!) job we did back in '07:
PAYMENT SCHEDULE - Client to submit payment(s) as follows:
• 1st Payment: Deposit of $6,291.00 (upon acceptance of this proposal)
• 2nd Payment: $6,291.00 paid on the day the work begins
• $4,300.00 paid upon completion of aggregate base installation and construction of both retaining walls.
• Balance paid in full upon the day of completion



Again, I'm big on being one step ahead. ya know, I really enjoy meeting new people, and we do work for some very good, as well as very fascinating people. We have to keep in mind the whole reason we're in business. And that is TO MAKE MONEY. If you wanna do charity work - FINE! But, usually charity work is done from the get-go that it's charity!

When you start leaving the door open for getting burned on payment, in all reality one could go work elsewhere as AN EMPLOYEE and make the same amount of income with less risks!


Credit cards aren't bad. There are advantages to accepting plastic. As well as disadvantages. But.....in the next couple years it's predicted that checks will be non-existant, a thing of the past.

tthomass
12-29-2008, 11:44 PM
I don't like credit card companies getting a % and if I understand correctly, it is illegal in VA to charge the customer that % more if they choose to pay with a credit card. I don't want to lose $ for their ease.

Perhaps the way around it, as example, would be to tell them;

"$10,000 to do the work we've discussed but if you pay by check we'll do it for $9,500."

I'm no saying that the job is $9,500 and if you choose to pay with a credit card I am going to charge you $500 more.

Summit L & D
12-29-2008, 11:49 PM
Figure the percentage into every project. Then you don't have to worry about it. I will say this....in the high end market you'll rarely see a client pay with a credit card. We've been setup to take cards for over a year, and have YET to actually use the service that we pay for.....

And you are right, you cannot add the fee as a separate line item. I bought a trailer one time on a card to get the points, and the dealer tried to charge me a couple hundred extra. Long story short, the dealer wouldn't refund the illegal charges (per how the salesman had invoiced the sale), and so he got the trailer back.

stuvecorp
12-30-2008, 12:04 AM
I am 50% to start and 50% upon completion, the only times I don't do that is an one day excavating project and then it is all when I leave. My typical projects are $10-20,000 so not that big(and residential). People seem to like it this way, any extras are kept track of and added to the end.

I agree that long contracts could scare the homeowners.

tthomass
12-30-2008, 12:15 AM
At time of signing a contract.........do you or don't you review the terms with the customer?

I typically do not but is dependent upon the job and feel for the customer but perhaps regardless I should. Sometimes they have the contract for X days making a decision, sometimes they quickly look through prior.

westcoh
12-30-2008, 02:37 AM
My estimating system even assists with drawing up the draw schedule!
Our proposals typically state that another 33.33% is due the day we start. However, I almost never hold the client to that. I usually collect the 2nd payment after we have settled in and after noticable headway is made.

Here is a real draw schedule from a real job that was around $36k:

PAYMENT SCHEDULE - Client to submit payment(s) as follows:
• 1st Payment: Deposit of $12,046.00 (upon acceptance of this proposal)
• 2nd Payment: $12,046.00 paid on the day the work begins
• $1,500.00 paid upon completion of aggregate base installation for 'Patio A'
• $1,500.00 paid upon completion of fire pit construction
• $3,500.00 paid upon completion of bench wall construction
• $2,000.00 paid upon completion of aggregate base installation and step installation for 'Patio B'
• $2,000.00 paid upon completion of construction 'Patio B'
• Balance paid in full upon the day of completion



Do your clients ever complain about having to make that many payments? I really do like the idea of setting up larger jobs like this and at the end only being owed a minimal amount, but it seems like it might be a hassle having to get 10 different cheques over the course of one job.

btammo
12-30-2008, 08:55 AM
So alot of your are actually getting more than 50% before the start of the job if you are 1/3 upon signing and 1/3 upon starting job. I would think that a job like 50K alot of people would rather break it down like that rather than pay 25K and 25K. I personally do the half down and balance due upon completion and never have had a problem.

My one question is are your deposits non-refundable if you are 1/3 down at contract signing? Ever have problems where you got to keep the deposit and never did any of the work?

DVS Hardscaper
12-30-2008, 05:08 PM
I don't like credit card companies getting a % and if I understand correctly, it is illegal in VA to charge the customer that % more if they choose to pay with a credit card. I don't want to lose $ for their ease.


I can't speak for other states, but where I am, it is not illegal to charge a "service fee" for c-card transactions.

This is where many get confused: See the credit card companies (Visa, M/C, Am Ex, Disc) they WANT people to use their cards. So if their merchants charge service fees for such a transaction - they're more likely to loose a sale. In my contract with our credit card processor it states that we can not charge any fees. And I think this is where some get confused with state laws vs what the card processor wants.

We've been working with plastic since 2000, and we charge fees for credit card processing. Many gas stations do this as well.

In terms of someone getting a percentage of your sale - well......is the glass half full or is it half empty? We have sold jobs simply because we do accept plastic, clients tell me "we went with you because my husband travels alot and we get points".

I had a job in a LARGE, new housing community. The guy went with us because we accepted American Express. That ONE job resulted in us doing patios for FOUR of his neighbors! No lie! Had we not accept credit cards - we may have never landed that job, thus we would have never gotten the other four neighbors.

I'll flat out tell the world that I hate to loose a sale. (and believe me, I loose many!) If I need to accept plastic to make a sale - I'll do it! Whatever it takes.

DVS Hardscaper
12-30-2008, 05:25 PM
Do your clients ever complain about having to make that many payments? I really do like the idea of setting up larger jobs like this and at the end only being owed a minimal amount, but it seems like it might be a hassle having to get 10 different cheques over the course of one job.


Couple of things:

I learn from other industries. I learn more for other industries than I do from fellow contractors.

1) Take a custom home being built. The builder will take a draw EVERY step of the way. Excavate for the foundation - he'll take a draw after the hole is dug. Pour footers, build or pour the foundation, pour the basement slab - He's gonna take a draw afterwards. Frame the house, pass inspection - he's pulling another draw. Hang and finish drywall - thats another draw! Rough in plumbing - there's another!


2) A critical element to business is TRUST. You develop trust the instant you walk on the prospective client's property. If you don't, then after that point you're wasting your time, they either like you or they don't. When you meet with a prospective client you arrive in professional attire. You have some sort of portfolio. You have spoken competently and CONFIDENTLY. You have shared expertise and wisdom in regards to the prospective project. All these things have just taken place before you have even designed the job. By this point you either have the job, or you don't. If you have the job - a reasonable client will not mind the payment terms.

Could my payment terms have scared away some fish? No one has ever told me that they have, but on the same token I would not be one bit surprised if I have lost some sales. But thats fine! It also works as a qualifier. Back in June I had a guy all set to go with us for a small job. I sent him the contract and he sent it back with at lest 50% of the terms and conditions crossed out! No joke! Infact I kept the contract to show to others! So then I accessed public court records and it turns out - this guy has a history of not paying contractors! See.......this is where my terms and conditions actually worked in my best interest, IT SCARED THE OLD BASTARD AWAY :weightlifter:


I could go on and on and on and on with this subject.

I learned first hand by being a witness in court against another contractor the value of dwindeling down the final balance.

mrusk
12-30-2008, 07:06 PM
I didnt read all the post. BUT 50% down on all projects is kind of crazy. Whos going to give you 100k before you step foot on their property?

tthomass
12-30-2008, 07:26 PM
Someone that can afford to do the job and pay me the remaining $100k.

But if you read the responses you'll see that it isn't necessarily 50% at signing.......the job may start a month+ later, but when day ONE arrives there will be a total of 50% in my hand or account. Never an issue.

If I recall Matt, your contract has an immobilization charge if a payment is not on time correct?

mrusk
12-30-2008, 07:50 PM
Someone that can afford to do the job and pay me the remaining $100k.

But if you read the responses you'll see that it isn't necessarily 50% at signing.......the job may start a month+ later, but when day ONE arrives there will be a total of 50% in my hand or account. Never an issue.

If I recall Matt, your contract has an immobilization charge if a payment is not on time correct?

Yes I do have a immobilization clause, that I have yet to use. Basicly if I am not paid on time, we will stop work and move to another job. Then we will get paid 3k to remobilize once we get the draw we were owed.

My typical job might have 10 different parts. Lets say we are doing a front walkway, driveway, pillars, pool deck, patio, plantings, mass excavation and sod.

I take a deposit of 10-25k. I then get paid for each item as we complete it. Day 3 we finsh the pillars, I get paid for the pillars in full. Day 10 we finsh the patio I get paid for that in full.

The deposit gets deducted from the last last payment. I set it up so the final payment is 5k or less. Lets say sod, which is last cost 20k. I would make the deposit around 15k.


This is the general way I set up my draws. On large projects its hard to set it up into 3 equal payments. Then if somethings gets delayed (such as a special order bullnose) people might try to hold up a entire draw for something that is a very small part of that draw.

Ofcourse I do tweak this method depending on the scope of the job.

talus
12-30-2008, 09:18 PM
Mrusk, from what I read it sounds like you you get a 75% deposit before you start each phase.

PROCUT1
12-31-2008, 10:23 PM
Im in a slightly different business....But I do the same.
50% due at contract signing.

I do almost 100% commercial work.....I never have problem getting the deposit. My company is also very well known in the business and has a very heavy presence in the area so Im sure that helps a lot....

Many times ill use a subcontractor and depending on who they are and who their references are will determine what deposit ill give them.

If I have never heard of them I would certainly not give them anywhere near a 50% deposit.

If its a large well known company and thats what their contract calls for, ill do it.

sgallaher
01-04-2009, 04:51 AM
In Delaware the contractor cannot collect 50% of the money before work is started. I deal in thirds. 1/3 deposit when contract is signed and to reserve your spot on our schedule. 1/3 on the second day of work (that way the client sees work started and materials on site) and the remainder of the payment when the job is complete. If it is a big job that will take a long time I may divide it up into quaters just so I have an even amount of money coming in through out the job. On the second day of work when I receieve the second payment I already have enough monies from the customer to pay for all materials. The final check pays labor and is profit. Plus lkes others said, 50% can scare the heck out of a client. When you make a contract you have to put yourself in your clients shoes while reading it. If you hired someone to do work would you sign it?

Stillwater
01-04-2009, 08:00 AM
Here is my contract in full...

Marc :usflag:

WoW.... You and I are quiet different,I consider contract formats and information contained in them to be classified for my eyes and my customers only.

Chrysalis
01-04-2009, 12:02 PM
Well I didnt make it using a lawyer or anything so It not really intellectual knowledge nor a lawyers. Supposedly a lawyer had alot to do with it but basically its the end product of a couple google searches and a little tweaking by me.

Paradise Landscapes
01-04-2009, 01:12 PM
Credit Cards, Can we legally charge 3% to 5% towards cost of service with a customers' credit card?

Stillwater
01-04-2009, 02:08 PM
Credit Cards, Can we legally charge 3% to 5% towards cost of service with a customers' credit card?

I beleive the answer is a big NO!, but check your credit card merchant account agreement.

PROCUT1
01-04-2009, 02:21 PM
Usually not.

But you can offer a "cash discount"

Paradise Landscapes
01-04-2009, 04:02 PM
I beleive the answer is a big NO!, but check your credit card merchant account agreement.

I am not set up to take Credit Cards. I am only asking.

DVS Hardscaper
01-04-2009, 06:54 PM
Credit Cards, Can we legally charge 3% to 5% towards cost of service with a customers' credit card?


Again, state law and merchant agreement are two different things. In MD - IT IS NOT ILLEGAL. The processing companies do not want us to charge a premium because it will deter people from using their cards. However, this industry is nothin but overhead. I can't pack anymore overhead into our jobs or I'll price myself off the planet! Therefore, I offer the bottom line price. Wanna pay withh plastic? No problem, but you'll have to pay what it costs us for you to do so.

Gas stations do it all the time. Back in the 90's it was very common to see stations advertise a cash price and a credit card price.

This summer, they started doing it again. We were doing some jobs in MD off of Rt. 81. The Truck stops there had diesel fuel for less than we were getting it for. So I pulled in for fuel and discovered that they had a cash price and a credit card price.

Frontier-Lawn
01-05-2009, 12:06 AM
i use Pay-Pal and i just eat the cost i rather pay a fee then make the client pay it and force them to write a check to avoid a fee. then i have to worry and deal with any returned checks.

Stillwater
01-05-2009, 02:46 AM
i use Pay-Pal and i just eat the cost i rather pay a fee then make the client pay it and force them to write a check to avoid a fee. then i have to worry and deal with any returned checks.

totaly reasonable.......

STL Ponds and Waterfalls
01-05-2009, 01:09 PM
i use Pay-Pal and i just eat the cost i rather pay a fee then make the client pay it and force them to write a check to avoid a fee. then i have to worry and deal with any returned checks.

How is that working for you? That is how I'm set up to take CC's but I yet to have anyone use a CC. Usually if they have to finance the project they use GE financing or a home equity loan which will be harder to do now days.

Mid-Ohio Scaper
03-04-2009, 02:35 AM
I've yet to see a warranty for hardscapes in any of your contracts????

tcalb2
12-19-2010, 09:40 AM
3 years ago I would have scrolled past this thread b/c it was boring, but since then I've run into a few customers from h*ll I think anyone doing hardscapes should read through this thread and copy and paste for future contract revisions. Thanks guys.

DVS Hardscaper
12-20-2010, 10:55 AM
3 years ago I would have scrolled past this thread b/c it was boring, but since then I've run into a few customers from h*ll I think anyone doing hardscapes should read through this thread and copy and paste for future contract revisions. Thanks guys.


We still get our 1/3 down as allowed by law. More than ever before I stand firm believer about collecting draws throughout the entire construction process.

And recently there was talk on the news about the Federal Gov't passing a law saying that credit card processing companies could no longer dis-allow a merchant to charge fees for processing plastic. Not sure where that stands right now.

Whether it's payment terms, clauses pertaining to approval of material colors, or stating an expiration date for when a client may sue a contractor (yes, I have heard of such a thing) - it's stuff everyone should be reading.

tcalb2 mentioned "customers from h*ll". I've been doing hardscapes going 15 years. Back in the hay-day I had 2 crews going, busy busy busy. I never had any problems with clients. Now, we're running a skeleton crew and I'm on the job more than ever and this year I have had more problems with clients than ever before. I think people are more stressed than ever, even if they're sitting on a pile of money. I think American society has become angrier.

And this is where your terms and your contracts are more important then ever before. I could sit here and type for days and days about contracts, payment terms, state contract law for contractors, etc. My father once said to me "everybody is always nice....until it comes to money".

We recently done a job in a surburban setting. Involved importing about 100 tons of aggregate. The house was built in the 60's or 70's, which means the trees are mature. Well, what do you know, one of the drivers ripped off an over-hanging trunk of a large old Japanese maple that was planted RIGHT NEXT to the driveway! Homeowner was furious. I felt terrible. But, fact of the matter is they had a power and a utility line over the driveway, AND a tree over the driveway. A Small, narrow driveway. And no where else to unload the material. I even stood there and spotted all the drivers with backing in and unloading. It was simply a challanging job in terms of dumping. Luckily, the contract has a clause about damages to trees, plants and pavements. Other than cutting the tree down prior to starting the work, there is only so much magic you can do when variables exist, and you need to be prepared for them one way or another. The client accepted the contract on their own free will. I'm very sorry, but that was the deal, and a deal is a deal.

We had another client this year whom we did a very small patio for. They had an existing light installed by the builder. They told me of all the problems they had with that light. I offered to do some modifications for the light. The Mr. declined. Ok, fine. We do the work, they're tickled pink. 3 months later the Mrs calls me and tells me the light pole is falling over. I go look at it and see everything in terms of the light is just as it was not only when we finished...but before we started. I call her and politely explain to her that the light hasn't moved and it is the way it was before we did the work. She agreed and hastily proceeded to say "you should have straighted the light when you did the work". I politely responded "there is some work involved in straightening it, I offered and your husband declined". She didn't wanna hear that and was getting more angry. Again, I had to revert back to our contract. I said "ma'am the contract spells everything out, nowehere does it mention we'll make mods to the light".






,

tthomass
12-20-2010, 11:51 AM
Contracts are a PITA sometimes but every little detail, no matter what it is, should be specifically listed so to avoid any altercation.

My terms are a little different now, but I have 50% day #1. Payment schedules are determined based upon the job.

2. A typical pay schedule may be used. For example: 50%, 20%, 20% and final 10% at walk through.

DVS Hardscaper
12-20-2010, 12:10 PM
Every little detail is right. Also, since no 2 jobs are ever the same, there is always some minor detail that we either don't think of stating, or that we forget to state.

I've gotten in the habit of makin notes to myself on my smart phone. If I'm driving and I think of a minor, yet important detail involving a prospective job that I'm working on pricing - I'll make a note about it so I remember to include it in the proposal.



,

AzLawnMan
12-20-2010, 01:27 PM
I will be starting a job in January, about $78k and the customer said to me, "We will go with your company but we would like our lawyer to take a look at the contract" I said sure. About a week later he called and said his lawyer had made some changes and they would like to meet to go over them. I responded, "Thats great that your lawyer is watching out for you but my lawyer did the same and my contract is not negotiable, it is designed to protect me. I feel my contract is a fair contract and protects both sides equally". After a few days they called and agreed and I recieved the down payment. I too get paid in sections so that the remaining balance is very small at the end of the project. What I have learned though in these past 3 years is that contracts do not mean crap in the court of law. If the customer wants to rob you then they sure as hell will do it.

Your right about what your dad said DVS, when customers owe me money I never hear from them, when they are up to date they complain so much. I have a customer who owes $22k and for the past 3 weeks she has been telling me the check will be processed "this week". :dizzy:
After looking through her contract I will be enforcing my 10% charge a month for late payments that is retro-active! So maybe she may learn her lesson about being 120 days late.

GreenI.A.
12-20-2010, 03:32 PM
After looking through her contract I will be enforcing my 10% charge a month for late payments that is retro-active! So maybe she may learn her lesson about being 120 days late.

can you leagally charge 10% per month, that comes out to over a 200% APR.


I do 50% down and 50% due on day of completion, on larger jobs we also hae a payment schedule to cover any materials and sub contractors as they are needed. I'm not paying anymore than my own employees pay out of pocket, anything else is covered by the deposit. If I have to wait or fight to get the remainder at the end, atleast i know my subs and distributors are payed in full, nothing worse than pissing off our disributors cause your waiting for a check

Steiner
12-21-2010, 11:05 PM
Many of these ideas I got from you guys and this forum:

Note: I try to write then in an informative style with legal teeth, not all teeth.


Warranty/Guarantee

¸ A 3-year warranty against defects in materials and workmanship on any hardscape work is included. The contractor will remediate the issue, replace or repair damaged items, or provide a similar replacement, to the satisfaction of both parties at no cost to the homeowner during the 3 year period. The period of 3 years will start upon the day of completion. Major natural events and acts of God will not be covered.

¸ The plant materials are guaranteed to establish provided they are watered and cared for by the homeowner as specified by the tags and/or contractor’s verbal or written instructions. The nursery may also provide a warranty on plant material.


Property Owner’s Responsibilities:


¸ Homeowner will remove all personal items from the immediate site prior to contractors arrival.

¸ Homeowner must supply access to 110V electrical service and water from a hose during construction.

¸ Homeowner must notify the contractor of any known buried underground utilities that are property of the homeowner prior to excavation.

¸ Homeowner must keep driveway clear for deliveries during time of construction.

¸ Family members including children and pets must be kept away from the site of construction until completion for safety. Kids should not play on or around equipment used in the construction process.

Construction Timeline:
q Please call to schedule.

Construction will begin on ___________ at _________ and should be completed in approximately ________ business days depending on weather and soil conditions (see below).



Clauses:
C1-Underground objects found such as but not limited to: concrete, stumps, roots, construction debris, large rocks, pipes, or other immovable objects which hinder excavation will be at an additional cost to the homeowner.

C2- Unfavorable weather may delay construction for an unknown number of days due to the nature and scope of the work. Work will resume when contractor dictates site conditions will allow favorable conditions for work.

C3- Transplanting Existing Living Plants: Client will indemnify and hold Contractor harmless from all resulting claims, liability, and/or responsibility for deceased or damaged plants from a result of transplanting.

C4- Color Variation: Hardscape products such as, but not limited to, interlocking concrete pavers, retaining wall block, steps, caps, corner units, curbing, and natural stone are comprised of natural ingredients; hardscape products will vary slightly in color and blend batch-by-batch depending on environmental conditions. Therefore, colors shouldn’t be expected to be an exact match of any particular unit. This includes any completed jobs or displays Client may have visited, as well as brochures, and other advertisements Client may have seen or be in possession of.

C5- Over-dig: In cases where unforeseen soil conditions warrant an over-dig situation the homeowner will pay for applicable materials, tools and equipment, and labor charges to remediate the situation.

C6- Efflorescence- A white powdery deposit may appear on the face of stone or masonry products due soluble salts being drawn through the materials. Efflorescence is not an indication of structural deterioration, and is it is recommended to let Mother Nature take its course. Contractor will not be held liable or responsible for efflorescence.

C7- Time Warner Cable- Time Warner cable does not follow standard industry practices and bury their cable below 6” of the soil surface. Time Warner also does NOT typically come out to mark when notified by UFPO. Due to these issues cable services may be interrupted and homeowner will not hold contractor responsible for interruption or repair of these services.

C8- Plant material selection- Because of the limited growing season and timing of availability in CNY, plants may be substituted and changed from original drawing specifications. Sizes and quantities will be honored at original specification unless noted on a change order.

C9- Moss and mold- Wet dark areas especially over clay soils may cause moss and mold growth on hardscape products. Certain hardscape products with more texture and surface features are more susceptible to moss and mold. Conditions such as exhaust vents from dryers, hot water heaters, and furnaces may also increase the likelihood of moss or mold buildup. This is not a defect in materials, or workmanship, and the contractor will not be held liable or responsible for moss and mold growth.

DVS Hardscaper
12-21-2010, 11:35 PM
Steiner - some of those look familiar :weightlifter:



I do my warranty sheet completely seperate from the proposal. My proposal states the warranty in one or two short sentences, and then when the job is complete, they get a seperate detailed warranty sheet.

custom patios
12-22-2010, 11:09 AM
Funny how everybody's collection terms are similar. Not referring to %'s or down money, but everyone collects money on the terms of "COMPLETION".


My contracts are set up to receive money on the terms of "COMMENCEMENT"

In fact, before new Pa laws, there were times that I was paid in full before job completion. The last payment, which was measly, was often paid at COMPLETION, but was only a very small portion of profit.