Reading About a Plumbing Contract
A plumbing contract agreement is an important document. Your contract should explain what work is to be provided as well as the rules and regulations of your company. It establishes a professional working relationship between you and the homeowner. A contract protects both parties because it protects the homeowner from poor or incomplete work and protects the plumber from non-payment after the job is completed. Contract agreements are not typically drawn up for small jobs like replacing a toilet but they can lay the groundwork for future work.
Your contract should include all services that you offer, warranties, payment schedule, and terms of service. One way to ensure that nothing is left out of your contract is to use a checklist when every time you draw one up. Some of the most common problems that people run into when drawing up a contract are:
- Not being thorough in the description of the work that is to be done.
- Assuming that the homeowner knows certain things about the work that will be done.
- Leaving out payment schedules.
- Not mentioning if permits are included in the cost.
Some issues that are common to plumbing contracts include the following:
- Failure to identify a start and end date for the work to be done. If possible , make sure that the contract outlines exactly when the work will begin and end. If possible, you many even want to add a clause that addresses penalties for missing the finish date and also one that describes what should happen if the plumbing problems are worse than expected and more work needs to be done.
- Not identifying excusable delays. Things happen and sometimes your work may be delayed because of product delays, bad weather, or any number of other reasons. It is important to identify in the contract that some delays are out of your control and should not be grounds for penalties.
- Fails to include limits on total liability. Unfortunately, there are some people that try to take advantage of others by squeezing out the most money that they can. As a plumber you want to limit your liability to the actual cost of labor and the materials. Very rarely do plumbing contractors ever get involved in litigation but it does stand to reason that you should protect yourself against this kind of activity.
Generally, it is a good idea to have a lawyer prepare or at least review your contracts.
Advantages of a Plumbing Contract
A well-drafted plumbing contract protects both the homeowner and contractor. In addition to setting out the expectations of the job, it also gives the contractor a limit on his or her exposure in terms of any dispute that may arise.
For example, it is not uncommon for a contractor to quote to perform certain services for a price, partially or fully sight unseen, and when the job gets started, the conditions may be different from what was originally observed. Unfortunately, disputes over how to resolve this can arise if there was no agreement as to such particulars.
The contractor can only be held to what he or she agreed to do as to the job. Thus, allowing for extra charges above and beyond what was quoted should be allowed for through the existence of a written contract. Verbal agreements are often hard to prove in court especially when the agreement is reached with friends or family!
In addition to extra charges, it is important to note that the contractor also has a limitation on his or her exposure. For example, if there is a provision in the contract that says that the contractor is not liable for any damages unless proven that such damages were directly caused by the negligence of the contractor, then the contractor is protected from a lawsuit unless something can directly be proven against him or her.
Critical Provisions in a Plumbing Contract
For those who own a commercial or residential building, keeping the plumbing running is essential. And that’s why any agreement to engage a plumbing contractor should include the following:
Payment Terms
Make sure the contract includes payment terms and conditions, including when payment is due, whether there will be financing, and what happens in the case of late payments.
Scope of Work
This is a critical provision because it defines exactly what work will be performed and when. It should include locations of work within the building, schedule of work (for instance, if your plumbing contractor is to perform work over a certain number of weekends, etc.), and how the contractor will handle more extensive work if it becomes necessary.
Timelines
Timelines are crucial in the provisions of your plumbing agreement. This provision should define exactly how long the plumbing contractor has to complete work, or how long he has to perform routine service.
Warranty
This is another important provision in the plumbing contract. All plumbing work should be warranted for at least one year after completion. However, there are a few things to keep in mind regarding warranty provisions:
Dispute Resolution
A comprehensive plumbing contract should include language regarding how disputes will be handled. Options can include mediation, arbitration, "baseball" arbitration, and litigation. Keep in mind that litigation will be time-consuming, and expensive, and can tie up a significant portion of your time. Decide what’s best for you and make sure it’s clear in the contract.
How to Write a Plumbing Contract
Drafting a plumbing contract is a straightforward process that involves several key steps. By following these guidelines, you can ensure that your contract is not only legally suitable for your situation but also meets your specific needs as a homeowner.
Establish the Contract Type
As with any other service contract, the first step in drafting a plumbing contract is to establish the type of contract you want to use. A cost-plus contract is based on a rough estimate of the job’s price, but it can change as the work progresses. A fixed-price contract sets a specific price that does not change no matter how long the job takes.
Gather Quotes
The next step is to obtain at least three quotes from local plumbers. This way, you can pick a price that is in the ballpark without overpaying.
Make Sure a Contract is Necessary
Remember that simply supplying your potential plumber with some basic information about the job may be all you need to do. If your repairs are simple or small, entering into a contract could be an unnecessary complication.
Use a Template or a Prewritten Contract
Writing a plumbing contract from scratch can be extremely difficult, especially if you have never done it before. If you don’t have time to draft your contract or if it’s too complicated, try using a template or prewritten contract. Many plumbing contracts are available online.
Seek Outside Help
If you are having difficulty creating a contract, you can ask an attorney to help you. An attorney can draw up a contract for you or fill out one of the templates for you. Although an attorney will usually charge for his or her time, costs may vary. An attorney can also help you determine whether you really need a contract in the first place.
Example of a Plumbing Contract Agreement PDF
Of course, the easiest way to find a plumbing contract online is to conduct a quick Google search and use the first agreement you find. However, there’s a pretty good chance that whoever put together that form document did so without taking any special consideration for your business’s unique circumstances. In that case, going with the flow might ultimately be detrimental, as the contract could leave some of your rights unprotected or hold you to terms and conditions that are unreasonable.
If you want to create a plumbing contract that is tailored for the specific needs of your business , then it’s best to make your own. Creating your own contract does not mean you have to build the document from scratch. There are plenty of free plumbing contract samples available online that can be downloaded, printed and filled out with the relevant information. But it gets even better.
We put together a plumbing contract that covers a general job. It includes all of the basic information that should be covered in a plumbing contract, as well as a few optional clauses that a contractor may want to add to the contract if it makes sense for their business. It’s completely editable, so you can add, remove or revise any section of the document. It’s also completely free. Just click on the link below to download the document. That’s it!
Pitfalls to Avoid
Crafting a plumbing contract agreement is not simply a matter of documenting services and billing. What can end up being a multi-thousand dollar situation for you may hinge on one line in the agreement, or absence of such language altogether. Here are some common mistakes made by plumbing contractors in their contracts and how you can avoid them.
Not specifically covering scope of work. A poorly defined contract may be viewed by a court as an incomplete agreement. Be as specific as possible about the scope of work you’re performing, both for you and for the property owner.
Ignoring prompt payment and/or late fees. Every effort should be made to ensure that your contracts include the amount of time homeowners have to pay. However, it’s imperative that you include a provision for charging late fees if the payment window is exceeded. Failure to include this language could make it virtually impossible to collect any additional fees owed.
Focusing on price instead of price options. Focusing primarily on price instead of what homeowners will be charged if they opt for a lesser price will ultimately hurt you financially. Include all price points in your contract so that homeowners can choose even if a price reduction is offered.
Not including dispute resolution procedures. Disputes between plumbing contractors and homeowners are common, in some instances resulting in lawsuits. Never leave yourself open to being sued when you can include a dispute resolution process and arbitration clause in your contract.
Skipping initialing of terms on contract. Homeowners don’t have to sign off on your contract; they can initial every page. Without this option, homeowners can claim they never formally accepted terms. This is not to say that a signature on the contract won’t suffice, but as with all legal processes, it’s better to be safe than sorry.
Asking for more information than necessary. Stipulating that homeowners provide you with their personal information rather than just their contact information is a mistake. Collecting irrelevant data could result in a homeowner refusing to sign the contract.
Not having it examined by an attorney. Every new contract should be reviewed by an attorney prior to use. He or she may find language or lack thereof that is needed to protect you and your business.
Executing and Signing the Contract Agreement
After the plumbing contract agreement is drafted and before it’s signed, it is crucial that the agreement be reviewed with all parties to ensure that everyone has a clear understanding of the terms and conditions. Explain every item in the agreement to all parties so that everyone is on the same page concerning the terms of the plumbing agreement. Discuss how you’ll accept payments (i.e., full payment before the job begins, at agreed-upon intervals, or upon completion of work), and discuss how costs and additional expenses will be handled once the project is underway.
Make sure that you have enough money to cover start-up costs, which often include plumbing permits, equipment, and inspections, as well as for unexpected costs that can arise during the course of a plumbing project . It’s a good idea to clarify that the total cost of services has no upper limit. Many homeowners don’t understand that because they’re locked into the contract they are responsible for paying any extra costs that the plumber incurs while completing the project. It’s a good idea to explain the reasons that this is necessary, such as the fact that unexpected problems can and do arise and will need to be addressed using time and resources delayed until that problem is resolved.
Once you’ve gone through the entire agreement and discussed what will happen if any issues arise during the project, have everyone involved sign the document. After signing, make sure to provide each person with a copy of the signed agreement for their records.