A construction contract is broadly divided into two main sections: the Scope of Work and the General Conditions. The Scope of Work describes the work to be done, by whom, and when. The General Conditions is basically everything else in the contract, the so-called “fine print,” defining the legal rights and responsibilities of the parties involved.
Both sections are important, but you often only refer to the General Conditions if there are problems. The Scope of Work, on the other hand, provides a roadmap for the project. From my perspective, clearly defining the Scope of Work is the most important part of any construction contract. If there is clear agreement by all parties about the work to be done, then you are off to a good start.
The Scope consists of a general description of the work, and usually includes a set of the drawn plans, plus the written specifications describing the materials to be used and how to install them.
Depending on the size and complexity of the project, the Scope may also include:
- A schedule for the project, with measurable milestones
- A list of participants and their responsibilities
- Technical data, quality standards, and any testing or inspections required
- Specific exclusions to the contract
- Work that will be added to Scope (and priced separately)
Incomplete plans and specifications are the source of many disputes. The contractor may have given you a price, but what exactly is he going to do at that price? Without detailed plans and specs, you won’t know until it’s too late that the price did not include painting, or light fixtures, or gutters, or trash removal, or whatever.
If anything is not listed in the Scope of Work, don’t assume it is included. Before signing, get clarification and put it in writing!
Who provides the plans?
Construction drawings can hide a lot of sins. Unscrupulous contractors may leave important items out of the plans and specs that they provide, knowing that they will need to add them later as change orders – thereby winning the job with a low bid, but maybe ending up the most expensive choice. This is a common bidding strategy on public works projects.
However, even conscientious contractors (or architects) may inadvertently leave out important, but essential, details, leaving you and the contractor to argue later about what was and wasn’t included in the bid.
The best plans call out important construction details, and often contain specific information about materials and their installation. Complete plans like this are easy to bid on and will allow you to get apples-to-apples bids from contractors.
On the other hand, drawings from a designer can be more artistic and conceptual in nature, implying a look that the designer has in mind, but avoiding the messy work of figuring out how to turn the visual concept into real 3-dimensional building materials and techniques.
In this case it is left up to the contractor to interpret the drawings – or it must be worked out between the architect, client, and contractor if the architect is still involved. In any event, fuzzy plans and specs can lead to fuzzy prices, change orders, and disputes.
Also you will get a hard time getting apples-to-apples bids from different contractors as they each may interpret the plans differently. It’s best to work out the details before putting the project out to bid and certainly before starting construction.
In some cases, there is a conflict between the When there’s a conflict between the drawn plans and the written specifications, the specs generally override the plans.
What’s included in the bid?
Small repair and remodeling jobs may contain a long list of items to be completed but no drawings. That’s fine as long as the list contains sufficient detail.
For example, the contract might state: “Contractor to install 6×8-foot walk-in closet with standard-height poles and shelving.” Is the shelving melamine-faced particleboard, vinyl-coated wire, or wood? If it’s wood, what grade and finish? Are the poles wood or metal? One pole along each wall? Floor-to-ceiling shelves or just one or two above each pole?
The contractor knows what he has in mind, but just has to take the time to describe it to you in writing. A simple sketch would help as well in this case.
Whether or not a contractor intentionally fails to include, exclude, or mention specific work items to the homeowner, the contractor is in a much better position that the average homeowner to anticipate all the required steps, and their costs. It’s quite difficult for the average homeowner to know what’s NOT in the scope of work. These can be nuisance items such as cleanup, removing nails from the lawn after a roof tear-off, or providing light bulbs to all new fixtures. Or they may be high-ticket items such as disposal of toxic materials like asbestos, or supplying fill required for grading.
I know a recent new home where the owner was shocked to find out that $10,000 of fill required for final grading was an “extra.” Thousands of dollars in trenching costs for utilities were also tacked on to the final bill.
To avoid these kinds of surprises, ask for a detailed scope of work. Review it and ask questions if anything is unclear. Ask questions like these: How many coats of paint? Will spray paint be “back brushed” (it should be). Any costs for permits, approvals, or inspections? Is final grading and planting of grass, trees, and shrubs included? Are there any utility hookup fees, impact fees, or other fees not mentioned?
Always add the general question: “Are you aware of any additional costs I should expect to complete this project?”
If in doubt, it may be worth the money to hire an independent construction manager or estimator to review the plans and specs to make sure they cover all the bases.
What’s Excluded From the Bid?
While few contracts include a list of excluded costs, this is a good idea for both the contractor and homeowner. Again, everyone benefits when a job starts out with clear communication and clear expectations by both parties. If the contract does not list exclusions, you can ferret them out with a series of questions. Does the contractor’s bid include:
- All required cutting and removal of trees and clearing of land required for the project.
- All excavation and grading costs including cut-and-fill, removal of rocks, stumps, and debris, and purchase of any required soil and fill materials.
- Temporary power, sanitation, fencing, and all other site preparation
- All trenching and backfill required for utilities: water, electric, gas, etc.
- All plumbing from the well to house, including pump, piping, and pressure tank
- All work required to comply with the building code
- Protective finishes on all exterior wood, including pressure-treated decking and trim
- Final cleaning of the job site and removal of all construction debris
- Cost and final grading of topsoil, plus any seeding, planting, or other landscaping
- Repair of damage to walkways, yards, roads, etc., on the owner’s property
In Remodeling Projects
Does the contractor’s bid include:
- Testing or removal of any hazardous materials such as lead or asbestos
- All required rerouting of plumbing, ductwork, and wiring
- All moving of furniture, equipment, and supplies required for the job
- Repair of damage to adjacent rooms, such as cracked plaster
- Repair of damage to plumbing or mechanical systems caused by tying in to existing systems
- Repair of damage to existing roadways, walkways, patios, or landscaping by workers or construction equipment
- Upgrades ot plumbing, electrical, or mechanical systems, or to insulation required by building codes
- Final cleaning of dust and debris brought into the rest of the home
Bottom line. It’s imperative that you start out with an accurate and complete set of plans and specifications. If anything is unclear, ask a lot of questions about what is included and excluded from the bid. Add clarifications to the plans and specifications before you agree to a price.