TERMS AND CONDITIONS

TERMS AND CONDITIONS

 

Licensing 1.

Contractor warrants that it currently holds a valid license under the laws and statutes of the State of Michigan.

 

Time for Performance 2.

Contractor shall commence work under this Agreement approximately on the date specified in this Agreement. Contractor shall be deemed to have substantially commenced work when Contractor moves equipment onto the jobsite. If Contractor fails to substantially commence work within fourteen (14) days from the approximate date of commencement, Owner may delay the succeeding payment due to Contractor for a period of time equal to that of the delay in commencement of work. Allowance in approximate commencement and completion dates shall be made for any delays attributable to circumstances beyond Contractor's control.

 

Drawings, Specifications, and Permits 3.

The project will be constructed according to the drawings and specifications contained in Schedule A., incorporated into this contract by reference, which have been examined by Owner and which have been or may be signed by the parties to this contract. Unless otherwise specifically provided in the drawings or specifications, Contractor will obtain and pay for all required building permits and Owner will pay assessments and charges required by public bodies and utilities for financing or repaying the cost of sewers, storm drains, water service, and other utilities including charges for sewer and storm drain reimbursement, revolving funds, hookup, and other similar charges. 4. Owner will locate and point out the property lines to Contractor, and will engage a licensed land surveyor to provide boundary stakes if Owner is in doubt as to property boundaries. Owner assumes all responsibility for the accuracy of the boundary markers. Owner shall give copies of any restrictions, easements, or rights of way to Contractor before work is commenced. Unless otherwise specified, work does not include any changes or alterations from the drawings or specifications that may be required by any public body, utility, or inspector. Contractor, at Contractor's option, may alter specifications only so as to comply with requirements of governmental agencies having jurisdiction over same. The cost of any alteration undertaken to comply with any such requirements shall be in addition to the contract price specified herein.

 

Additional Facilities Requirements of Public Bodies Property Lines 6.

Unless otherwise specified, Owner will provide all water, sewer, gas, and electric utilities from the point of entry at Owner's property line or, if metering devices are required, to those devices. In compliance with federal and state law, Owner agrees to make drinking water and toilet facilities available to all workers or to compensate Contractor for the cost of rented facilities. Owner agrees to provide the electricity that Contractor requires at the jobsite to complete the work.

 

Access to Work 7.

Owner shall grant free access to work areas for workers and vehicles and shall provide areas for storage of materials and debris. Owner agrees to keep driveways clear and available for movement and parking of trucks during scheduled working hours. Owner shall be responsible for securing all entrances to the jobsite in a manner adequate to prevent persons other than Owner, Contractor, and any authorized workers or material suppliers from gaining access to that site. Contractor shall be responsible, at the end of every workday, for storing all equipment and materials in the facilities provided by Owner. Contractor shall not be liable for damage to driveways, walks, lawns, shrubs, or other vegetation by movement of trucks, workers, equipment, materials, or debris. Contractor shall keep Owner advised as to the hours during which work is scheduled to be performed at the jobsite. If Owner denies access to any worker or supplier of materials during scheduled working hours, then Owner will be deemed in breach of this Agreement and subject to liability for any damages caused by the breach.

 

Financing 8.

Owner is responsible for obtaining all financing that is or may be necessary to fund the work specified in this Agreement. Owner represents that Owner has sufficient funds or has arranged sufficient financing to comply with this Agreement.

 

Standard Materials 9.

The following shall apply to all materials included in the specifications for this Agreement:

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Nonstandard Materials 10.

If any materials used under this Agreement are to vary from those listed in Paragraph 9., or if the specifications, quality, or color of the materials vary from those listed in that Paragraph, both Contractor and Owner must agree to that variation in a writing titled "Specifications." That writing must be signed by both Contractor and Owner and must be attached to this Agreement and incorporated by reference.

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Hazardous Materials 11.

Unless otherwise specified in this Agreement, the removal, disturbance, or transportation of hazardous materials, including asbestos, is not Contractor's responsibility under this Agreement. The parties agree that, if Contractor encounters hazardous materials in the course of the Project, it shall stop work immediately and notify Owner who may then retain a qualified contractor to perform the work. Such work shall be considered Extra Work under Paragraph 15..

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Work Allowance, Conflict, and Abnormal Conditions  12.

There shall be a reasonable allowance on all dimensions specified in work plans. All sizes are outside approximate sizes. If there is any conflict between sketches, renderings, views, pictures, plans, blueprints, etc., and the terms of this Agreement, then this Agreement shall be controlling. Contractor is not responsible for any existing illegal conditions. Contractor is not responsible for any unusual or abnormal concrete footings, foundations, retaining walls, or piers required, or any unusual depth requirements, such as, but not limited to, conditions caused by poor soil, lack of compaction, hillside, or other slope conditions. Contractor may, but is not obligated to, correct those conditions. All work necessary to correct abnormal conditions that is required by public bodies shall constitute an extra work item and the cost shall be in addition to the contract price specified herein.

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Change Orders, Amendments, and Modifications 13.

Any subsequent amendment, modification, or agreement, which alters this contract, and which is signed or initialed by Contractor and Owner, shall be deemed a part of this contract and shall be controlling in case of conflict with any other provision in contract.

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Preparation, Work, and Material 14.

Unless agreed on in writing between Contractor and Owner and included in this Agreement under "Specifications," this contract does not include painting and preparation, filling, finishing, grading, retaining walls, new or relocated gutters and downspouts, screen doors, stair railings, or weather stripping. Contractor shall have the option of selecting all floor coverings.

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Extra Work and Changes 15.

If Owner, Construction Lender, or any public body or inspector directs any modification or addition to the work covered by this contract, the charge for that extra work shall be determined in advance and the cost shall be added to the contract price in addition to Contractor's usual fee for overhead and profit. Owner shall make payments for all extra work as that work progresses, concurrently with regularly scheduled payments. Contractor shall do no extra work without the prior written authorization of the Owner. Any authorization for extra work shall show the agreed terms and shall be approved and signed by both parties.

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Plumbing 16.

Unless specifically authorized by this Agreement, Contractor shall not change plumbing, gas, waste, or water lines outside of the foundation of an existing building. Unless otherwise specifically provided for, this Agreement does not cover work done on cesspools or septic tanks. The contract price does not include rerouting, relocation, or replacement of vents, pipes, ducts, or conduits not shown, or pipes that may be encountered in areas of alteration or excavation.

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Electrical Service 17. Unless specifically included in this Agreement, electrical work shall not involve a change to any existing service panel other than the addition of circuit breakers or fuse blocks to distribute electric current to new outlets. This Agreement does not include changes to existing wiring in areas undisturbed by alterations. All existing electrical wiring systems are assumed to be, and Owner represents them to be, adequate to carry the load imposed by existing work. Any work necessary to correct these existing conditions shall be an extra work item subject to Paragraph 14. of this Agreement.

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Plaster  18.

Contractor calls Owner's attention to, and Owner acknowledges, the limitations of patching plaster. While Contractor shall make every effort to match existing textures, colors, and planes, exact duplication is not promised.

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Filled Ground or Rock 19.

Unless this Agreement specifically provides otherwise, excavating does not include work on filled ground, ground of inadequate bearing capacity, or rock or any other material not removable by ordinary hand tools. This work shall be an extra work item subject to Paragraph 14. of this Agreement.

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Termite Work 20.

Contractor is not obligated to perform any work to correct damage caused by termites or dry rot. Any such work shall be an extra work item subject to Paragraph 14. of this Agreement.

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Removal of Material and Debris 21.

Except for items designated by Owner in writing prior to the commencement of construction, Contractor shall dispose of all material removed from structures in the course of alteration. Contractor shall remove all construction debris on termination of work and shall leave the premises in neat, broom-clean condition.

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Extra Time 22.

Contractor shall start and diligently pursue work through to completion, but shall not be responsible for delays caused by any of the following: failure of the issuance of all necessary building permits within a reasonable length of time; funding of loans; disbursement of funds into funding control or escrow; acts of neglect or omission by Owner or Owner's employees or agents; acts of God; stormy or inclement weather; strikes, lockouts, boycotts, or other labor union activities; extra work ordered by Owner; acts of public enemy; riots or civil commotion; inability to secure material through regular recognized channels; imposition of Government priority or allocation of materials; Owner's failure to make payments when due; delays caused by inspection or changes ordered by the inspectors of authorized governmental bodies; acts of independent contractors; holidays; or any other circumstances beyond Contractor's control.

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Damage to Project and Allied Perils Insurance 23.

Before any work commences under this Agreement, Owner shall procure fire insurance with course of construction, vandalism, and malicious mischief endorsements at Owner's own expense. This insurance shall be for a sum at least equal to the contract price. Loss under the insurance policy shall be payable to the beneficiary under any deed of trust covering the project. The insurance policy shall name Contractor and all Subcontractors as additional insureds, and shall protect the interests of the Owner, Contractor, Subcontractors, and construction lender. If Owner fails to procure the insurance required under his Paragraph, Contractor shall have the option to procure that insurance as agent for, and at the expense of, Owner. If the project is destroyed or damaged by any accident, disaster, or calamity, such as fire, storm, flood, landslide, subsidence, or earthquake, or by theft or vandalism, any work done by Contractor in rebuilding or restoring the project shall be paid for by the Owner as an extra work item subject to Paragraph 14. of this Agreement. If, however, the estimated cost of replacing the work already accomplished by Contractor exceeds 20 percent of the contract price, Owner shall have the option to cancel this contract and, if Owner does so, Owner shall pay Contractor the reasonable cost, including usual overhead and a net profit of 10 percent, of all work performed by Contractor before cancellation.

 

Workers Compensation Insurance 24.

Contractor shall carry workers compensation insurance to protect Contractor's employees during the progress of the work. Owner shall obtain and pay for insurance against injury to Owner's own employees, persons under Owner's direction, and persons on the jobsite at Owner's invitation.

 

Protection of Owner's Property 25.

Owner agrees to remove from the jobsite or to otherwise protect any personal property including, but not limited to, carpets, rugs, drapes, furniture, shrubs, and plantings. Contractor shall not be held responsible for damage to or loss of any items of personal property.

 

Guarantee of Materials and Workmanship 26.

Contractor does not guarantee any materials, equipment, assemblies, or units that Contractor has purchased or will purchase as part of the work covered by this Agreement. All of these items are subject to manufacturer's or processor's guarantees or warranties.

 

Work Stoppage 27.

Contractor shall have the right to stop work and keep the job idle if payments are not made to Contractor when due. If the work is stopped, for any reason, for a period of 60 days, then Contractor may, at Contractor's option, on five days written notice, demand and receive payment for all work executed and materials ordered or supplied and any other loss sustained, including Contractor's normal overhead plus a profit of 10 percent of the contract price. Thereafter, Contractor is relieved from any further liability. If work stops for any reason, Owner shall provide for protection of all material on the premises and shall be responsible for any damage, warpage, racking, or loss of that material.

 

Completion and Occupancy 28.

Owner agrees to sign and record a Notice of Completion within five days after the project is completed and ready for occupancy. If Owner fails to record the Notice of Completion, then Contractor shall, as Owner's agent, sign and record a Notice of Completion on Owner's behalf. This agency is irrevocable and is an agency coupled with an interest. Contractor may bar occupancy of the project by Owner or anyone else until Contractor has received all payments due under this contract and until the appropriate Notice of Completion has been recorded. Use and/or occupancy shall constitute completion. If a funding control service is used, then Contractor and Owner agree that the funding control service shall be appointed as Owner's agent to sign and record a Notice of Completion on Owner's behalf.

 

Notice 29.

Any notice required or permitted under this Agreement may be given by ordinary or electronic mail at the addresses specified in this Agreement. If either party changes his or her address, that party shall provide written notice of the change to the other party. Notice shall be considered received one day after it is deposited in the mail with postage prepaid.

 

Integration Clause 30.

This document and all documents incorporated by reference constitute the parties' entire agreement. No other agreements, oral or written, regarding the work to be performed under this Agreement exist between the parties.

 

Governing Law 31.

This Agreement shall be construed in accordance with, and governed by, the laws of the State of Michigan.

 

Corrective or Repair Work 32.

If minor items of corrective or repair work remain to be accomplished by Contractor after the project is ready for occupancy, Contractor shall perform the work expeditiously and Owner shall not withhold any payment pending completion of that work. If major items of corrective or repair work remain to be accomplished after the building is ready for occupancy, and the aggregate cost of that work exceeds one percent of the gross contract price, then Owner, pending completion of the work, may withhold payment of a sufficient amount to pay for completion of the work, but shall not withhold any greater amount.

 

Arbitration of Disputes 33

. Any controversy that develops between Contractor and Owner with regard to matters arising out of, or relating to, this Agreement, and that the parties do not promptly resolve, shall be decided by arbitration administered by and in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association unless the parties agree otherwise in writing. This Paragraph shall be specifically enforceable under the prevailing arbitration law. The award rendered by the arbitrators shall be final, and judgment may be entered on it in any court of competent jurisdiction.

 

Lead-Based Paint Disclosure and Acknowledgement 34.

Owner represents and warrants that the Property was constructed in ☐ before 1978 ☐ in or after 1978. If the Property was constructed before 1978, Owner acknowledges receipt of the U.S. Environmental Protection Agency pamphlet entitled “Protect Your Family From Lead in Your Home” prior to the commencement of any work under this Agreement. Owner further acknowledges that the services performed under this Agreement may disturb painted surfaces and understands that such disturbance may result in exposure to lead-based paint or lead-based paint dust. Owner represents that all information provided to Contractor regarding the age and condition of the Property is true and complete. Contractor shall have no responsibility for undisclosed or unknown lead-based paint conditions, or for inaccuracies in Owner’s representations. To the fullest extent permitted by law, Owner agrees to indemnify and hold Contractor harmless from any claims, damages, fines, penalties, or liabilities arising out of Owner’s failure to disclose the presence of lead-based paint or to provide accurate information regarding the age or condition of the Property.

 

Attorneys' Fees 35.

In the event of any arbitration or litigation arising from this Agreement, the prevailing party shall be entitled to recover its costs and reasonable attorneys' fees.

 

Construction Lien Rights 36.

 

Nothing in this Agreement shall be deemed to waive or limit Contractor’s rights under the Michigan Construction Lien Act. Any lien waiver or release executed by Contractor shall be effective only to the extent payment has actually been received and has cleared Contractor’s financial institution. Contractor shall not be required to execute any unconditional lien waiver prior to receipt of payment.

 

Suspension of Work for Nonpayment 37.

If Owner fails to make any payment when due and such failure continues for five (5) days after written notice, Contractor may suspend work without breach of this Agreement. Upon resumption of work, Contractor shall be entitled to an equitable adjustment of the contract price and the project schedule, including reasonable remobilization and restart costs. All completion dates shall be automatically extended for the duration of the suspension.

 

Owner-Supplied Plans, Specifications, and Materials 38.

Contractor shall be entitled to rely upon the accuracy and sufficiency of any plans, drawings, specifications, designs, surveys, reports, or materials supplied by or on behalf of Owner. Contractor does not warrant or guarantee the adequacy, code compliance, or fitness of any such items. Any defects, omissions, inconsistencies, or resulting delays shall constitute Extra Work subject to the provisions governing extra work under this Agreement.

 

Limitation of Liability and Waiver of Consequential Damages 39.

To the fullest extent permitted by law, Contractor shall not be liable for any incidental, special, or consequential damages, including but not limited to loss of use, loss of profits, loss of rental income, or diminution in value. Contractor’s total cumulative liability arising out of or related to this Agreement shall not exceed the total contract price actually paid to Contractor.

 

Owner Insurance Obligations and Proof of Coverage 40.

Owner shall maintain all insurance required under this Agreement and shall provide certificates of insurance upon request. If Owner fails to maintain the required insurance coverage, Contractor may procure such insurance as Owner’s agent, and the cost thereof shall be reimbursed by Owner as an additional contract expense.

 

No Privity With Subcontractors 41.

Nothing in this Agreement shall create any contractual relationship between Owner and any subcontractor, supplier, or laborer retained by Contractor. Owner shall not direct, supervise, or interfere with Contractor’s subcontractors or suppliers. Any Owner-directed change involving subcontractors shall constitute Extra Work.

 

Reliance on Owner Representations 42.

Contractor may rely upon all representations made by Owner regarding the condition of the Property, utilities, boundaries, access, permits, disclosures, and existing structures. Owner shall indemnify and hold Contractor harmless from any claims, damages, losses, or expenses arising from inaccurate, incomplete, or undisclosed information provided by Owner.

 

Owner Default and Cure 43.

Owner shall be in default under this Agreement upon failure to make payment when due, denial of access to the worksite, failure to maintain required insurance, or any other material breach of this Agreement. Monetary defaults shall be subject to a five (5) day cure period following written notice. Non-monetary defaults shall be subject to a reasonable cure period not to exceed ten (10) days. Upon failure to cure, Contractor may pursue any remedies available at law or in equity.

 

Indemnification by Owner 44.

To the fullest extent permitted by law, Owner shall indemnify, defend, and hold harmless Contractor, its subcontractors, agents, and employees from and against any claims, damages, losses, liabilities, or expenses arising out of site conditions, Owner-directed changes, Owner supplied plans or materials, undisclosed conditions, or Owner’s breach of this Agreement.

 

Survival 45.

The provisions relating to indemnification, limitation of liability, dispute resolution, attorneys’ fees, lien rights, and payment obligations shall survive completion, termination, or cancellation of this Agreement.