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Bbhb Contracts Presentation To Gohba Renovator Council Aug 18 Copyright
 

Bbhb Contracts Presentation To Gohba Renovator Council Aug 18 Copyright

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A presenation on the importance of using contracts for renovation projects.

A presenation on the importance of using contracts for renovation projects.

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    Bbhb Contracts Presentation To Gohba Renovator Council Aug 18 Copyright Bbhb Contracts Presentation To Gohba Renovator Council Aug 18 Copyright Presentation Transcript

    • Building Better Home Builders © 2010 Building Better Home Builders Inc. (BBHB). All rights reserved. The content of this presentation is protected by the copyrights of BBHB. No part of the content may be reproduced, distributed in any form or otherwise used without the prior written permission of BBHB.
    • Introduction Building Better Home Builders was established for the sole purpose of providing professional , confidential consulting services for the homebuilding industry.
    • JOB CONTRACTS: STARTING ON THE RIGHT FOOT Presentation to GOHBA Renovator’s Council August 18, 2010 By Rick Ottenhof BUILDING BETTER HOME BUILDERS All the help you need under one roof!
    • Today’s presentation  Why a contract is essential in doing business  The common elements of a contract  Different forms of contracts  Do I need legal advice?  Some closing thoughts
    • Why a contract is essential in doing business  The 5 liners are going to cause trouble – eventually.  Renomark = written contract.  Unfortunately, some clients are looking for an out.  Different level of detail needed for different scale and complexity of jobs  Clear understanding on both sides – reduces disagreements and disputes.  Reduces ambiguity and provides clarity of scope.  Less expensive than arguing with lawyers in court.  Remember the FRAM commercial! Pay me now or…….
    • Why a contract is essential in doing business Some myths about contracts  Myth – a formal contract more than 1 page will “scare the client”.  Myth – formal written contracts take too long to write.  Myth – my reputation makes a formal contract unnecessary.  Myth – clients view formal contracts as a sign of trouble brewing.  Myth – if I explain everything clearly the job will go smoothly.
    • Why a contract is essential in doing business The truth is..........  A formal contract of more than 1 page will provide the client with peace of mind.  Written contracts can be boiler plate but better if it is designed for your company- borrow but modify.  A written contract adds to your level of professionalism.  Clients want EVERYTHING written down– so should you.  If it isn’t in writing it didn’t happen! – I never said that.  Hire a lawyer if you haven’t already – cost of business.
    • The elements of a contract  A few elements explained –  Legal description – if you need to lien the job  Scope of Work – what is in and what isn’t included  Owners performing construction – not a good thing – know the impacts and how to guard yourself  Materials – Product specs – model, colour, substitutions, warranty, homeowner supply  Supervision – you direct traffic, owner deals with you/job super not the trades
    • The elements of a contract  A few elements explained –  Schedule – yes you need milestones, dates, it helps you get paid! Explain reasons for delays, remedies  Payment schedule – again milestones, payment due, interest, remedies, work stoppage, and..deposit  Job completion – substantial completion, holdbacks, warranty vs. work completion.  Warranty – on what work, 3rd party warranties, for how long - 2 years minimum
    • The elements of a contract  A few elements explained –  Address the unknown – there are hidden – yes you need milestones, dates, it helps you get paid! Explain reasons for delays, remedies  Change orders/deletions– in writing, dated, explains the how, the impact on schedule and the price (if applicable)  Dispute resolution – arbitration, mediator  Communication/updates – timing and detail  Sub-trades – reference them, list them if you can
    • The elements of a contract  A few elements explained –  Signage and promotion – permission to erect a lawn sign, take pictures for your brochure, references  Termination – protection for contractor and client, explains circumstances and payment provisions  Insurance – $2M for Renomark members, explain what is covered in the policy  Disruption – the worksite/home may be inhabitable during the construction period – I gotta move?  Security of payment– handling deposits, schedules, holdbacks, completion certificates
    • The elements of a contract  A few elements explained –  Damage and debris – who’s supplying the bin? What if they damage my driveway and lawns?  Quality and Standards of work – can be a general reference, protection for contractor and client, use the Tarion Construction Performance Guidelines – Building Code reference as well  Permitting – take out the permit to ensure that all bases are covered and no issues with inspections – watch for variances and add a clause that protects you in case of delay
    • Different forms of contracts  The 1 or 2 pager  Might work in a very small and basic job – but which ones are?  Short and sweet, could be bitter  Lots of stuff gets left out of short contracts  May be seen as a reflection of your attention to detail!!!  A 2 pager will cover the minimums noted but the details make dispute resolution less expensive  Don’t forget the schedules and drawings
    • Different forms of contracts  The longer form 4 – 10 pages  Don’t apologize for a long form contract.  Can’t explain/understand the contract - it is the wrong one.  Make sure the contract fits your company.  Changes made by the client – lawyer should review first.  Contract = core contract plus schedules.  After the contract is complete ask the client if the contract played a role in them hiring you!
    • Do I need a lawyer?  Yes – great investment to get started.  Be careful with language – too much legalese can confuse.  “Hereto” and “therefore” – not helpful.  Have the core contract document(s) reviewed once a year.  More complicated, unique, the “one ofs” and higher priced contracts- use a lawyer each time.  Play renovator not lawyer
    • Some closing thoughts Number one issue facing the industry – sleep deprivation. Every renovation company is different – contracts need to fit the company and the project Remember the myths Detailed contracts are expected as a Renomark member Better to get the issues out of the way upfront and put it into a contract
    • Some closing thoughts Avoid the legalese which neither you nor your client will understand People buy when all their questions are answered Contract should provide for changes orders- in writing and all parties to sign. Document the progress everyday and communicate Share your contracts with other members  “good paper fosters good relationships”
    • Thank you!