Contracts & ExecutionQuestion 890 of 1632

Overall, the single most effective way for a contractor to prevent and win contract disputes over scope, extras, and payment is to:

a.A complete written contract, with signed written change orders
b.Verbal agreements and a good working relationship with every owner
c.Leaving payment terms out of the written agreement
d.Leaving the scope undefined, in order to preserve some flexibility

Explanation

Every dispute about extras is really a dispute about what the scope said and whether the change was authorised, and the contractor is the party who loses when neither was written down. On home improvement work this is not merely best practice but the law: B&P §7159(d) requires the contract and any change to it to be in writing and signed before the covered work begins, and §7159(e)(3) makes the contract warn the buyer that an extra without such an order is unenforceable against him. (d) is the argument that vagueness leaves room to negotiate; in practice it leaves room for the owner to say the work was always included. (c) removes the one term §7159(d)(5) makes mandatory. (b) works right up until the money is disputed, which is the only moment the question is asked.

Law Reference: Bus. & Prof. Code §7159(d), §7159(d)(5), §7159(e)(3)

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