Checklist for Oregon
Residential Construction Contracts
Mandatory Terms
If the work is more than $2,000, you must have a written contract. The failure to have a written contract will bar you from filing a construction lien claim.
A statement that the contractor is licensed with the CCB.
The contractor's CCB number, address, and phone number.
The owner's name and address.
The address where the work will be done.
A description of the scope of work to be done (see comments below).
Price and payment terms (see comments below).
A list of the required consumer notices (see below for more information).
A statement that the owner has the ability to file a complaint through the CCB.
Acknowledgement of a written warranty. This is only for new homes. There is no mandatory language for the terms of the warranty.
Maintenance schedule. This is only for new homes. The CCB has rules setting out very specific minimum information that must be included.
Optional Terms
Payment terms:
You should specify either a fixed price or cost-plus contract price.
Be careful of "mixed" terms: For example, having a fixed total price, but then listing out specific line-item prices.
Does the price include costs such as permits?
Scope of work. This is a critical aspect of a contract and one that is not adequately addressed by most contractors. This should cover exactly what is being done as well as what is not being done.
Schedule. If you set a completion date, be sure to address time extensions in any change orders.
Change Orders. Every change order must be signed. Be certain that these are in writing and address all three major terms:
Scope of work
Price
Time.
Standard of Care. Do you want to specify the standards for the workmanship?
Design Responsibility. If you are not responsible for the design, you should state that in the contract.
Warranties. You should include some warranty terms (even though the terms may limit the owner's warranty rights or disclaim some warranties).
Limitation of liability. Do you want to include this kind of term?
Attorney fees. Think very carefully about whether you want this term.
Past-due interest. Again, think carefully about whether you want this term.
Retainage. Do you want to give the homeowner this tool?
Default. Do you want to address this issue in the contract? For example, if the homeowner does not pay, do you need this term to all you to suspend work?
Dispute resolution. Do you want to place restrictions on how this will occur? Remember, you cannot include a clause prohibiting the homeowner from filing a CCB complaint.
The CCB recommends the use of a "check the box" system:
The boxes note that the contract either does or does not include a mediation or arbitration clause.
The owner's rights and obligations concerning contract cancellation (there is statutory language).
Notes
Is your bid going to end up as the contract? If so, then it needs to include all of the required terms.
Does your contract incorporate other terms or documents? Ideally, those should be attached.
If you are selling a new home (or one that had more than $50,000 in remodeling within three months of the sale), then you must comply with the Homebuyer Protection Act.
You are required to keep a list of all subcontractors who work on a project (with their name, address and license numbers). Also, make certain that all of your subcontractors have active licenses.
If you have any possibility of working within the "lead paint" requirements (both Federal and State), be sure that you have first obtained all necessary licenses and that you comply with all requirements.
Mandatory Notices
These are the three notices that must be given to the owner:
Information Notice to Owner.
Notice of Procedures.
Consumer Protection Notice.
The notices must be provided at or before the date the contract is entered. Think about how that might work when you give the homeowner a bid.
You must "maintain proof of delivery" for at least two years.
There are three ways to maintain proof of delivery:
Signed copies of the notices;
A phrase in the contract that is initialed by the owner; or
A copy of the contract if the notices are included within it.
If you do not timely provide the Information Notice to Owner, then you do not have construction lien claim rights.
The CCB regularly updates these forms. Be sure to use the current ones (available from the CCB's website).
