How to Write Terms and Conditions for a US Contractor Quote
Every US contractor quote should include terms and conditions. Without them, the only rules governing your project are whatever a judge decides seems reasonable – which is rarely what you intended.
Essential Clauses for US Contractor T&Cs
Payment terms: “A [25%] deposit is required at contract signing. Final balance is due upon substantial completion. Invoices unpaid after 30 days accrue interest at 1.5% per month.”
Change orders: “Any work outside the scope described above requires a written, signed change order before commencement. Verbal authorizations are not binding.”
Mechanic’s lien notice: Many US states require contractors to provide a preliminary notice preserving their lien rights. Include: “In accordance with [state] law, contractor reserves the right to file a mechanic’s lien against the property for unpaid amounts.”
Warranty: “Contractor warrants workmanship for [1 year] from substantial completion. Warranty does not cover damage caused by misuse, natural events, or work performed by others.”
Dispute resolution: “Disputes shall first be submitted to mediation. If unresolved, disputes shall be settled by binding arbitration in [county/state] under AAA Construction Rules.”
Force majeure: “Contractor is not liable for delays caused by weather, supply chain disruption, labor disputes, or other events beyond contractor’s reasonable control.”
Right to subcontract: “Contractor may subcontract portions of the work to qualified subcontractors. Contractor remains responsible for the quality of all subcontracted work.”
State-Specific Requirements
Several states have mandatory contractor contract disclosures for residential work: – California: Must include right to cancel notice (3-day right to rescind for home solicitation contracts) – Florida: Specific payment schedule and lien disclosure requirements – Texas: Notice of contractor’s lien rights must be given within specific timeframes
Consult your state contractor association for state-specific requirements.
FAQs
Do my terms and conditions need to be reviewed by a lawyer? For large commercial contracts, yes. For standard residential work, a well-drafted template reviewed by an attorney once is sufficient – you don’t need a lawyer to review every quote. Your state contractor association often provides template T&Cs.
What is AAA arbitration and why include it? The American Arbitration Association (AAA) provides binding dispute resolution outside of court – faster and cheaper than litigation for construction disputes. Including it in your T&Cs means disputes are resolved by an arbitrator familiar with construction rather than a court unfamiliar with your industry.
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Related reading:
- How to Write a Quote That Wins the Job as a US Contractor
- How to Follow Up a Quote Without Being Pushy (USA Contractors)
- How to Ask for a Deposit Without Losing the Job (USA Contractors)
- The Difference Between a Quote and an Estimate for US Contractors
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