Clear Painting Agreements

There are many different forms of agreement drafted by contractors and clients setting out the obligations of each party to the agreement. Some forms of agreement are great, covering off all the important stuff such as details of the service including standards to be provided and the payment terms for the service. Then there are some agreements that are not so great leaving out the details needed to provide certainty of expectations.

In this article we list the critical steps to drafting agreement terms that will clearly identify the obligations to be fulfilled, avoiding any “grey” areas and most importantly, avoiding disputes!

Step one: Identify and name the parties entering the agreement

An agreement must name the parties by their legally-given monikers. The agreement is to list both the business’s name and relevant employee’s name signing on its behalf. Remember to indicate the type of business you’re entering into a contract with. This may be a Sole Trader, Company, Trust or Partnership. Contact information of both parties must be included too which is needed for service of any formal notices.

Step two: Detail the scope of work or services to be rendered

Compile a detailed description of the project at hand. Make sure to include all minutiae here – however superfluous these details may seem. Information such as what type of materials should be used, quality standards expected, quality of workmanship, health and safety requirements and specific instructions or preferences need to be stipulated. Also, include the consequences should these requirements not be met.

Step three: Define the time constraints

Include the time and date that the project will be completed by, as well as the daily working hours the project will be worked on. For example, “Between the hours of………… from ____ to ____.” This protects the contractor from working an unreasonable number hours, and also protects you as it ensures that all work is completed on time. Include a stipulation stating the rate to be paid for work rendered out of the agreed working hours.

Step four: Identify the location where work will take place

Stipulate the exact address of the premises where work will be executed, as well as the details of the site. For example: “Work will take place at ______________ , specifically, the First Floor bathroom.”

Step five: Identify the responsibilities and rights of both parties

To avoid a case of “He said, she said”, explicitly state and explain the roles and responsibilities of both the contractor and yourself. For example, a contractor may not be covering his worker’s compensation insurance and liability insurance which could form part of the legal requirements in your region.

Step six: Stipulate terms and conditions of payment

Detail the way in which the contractor will be remunerated for their services.  For example, the amount may be paid as a lump sum on completion of the project, or it might be paid via weekly, fortnightly or monthly instalments. Also, include terms and conditions for late payment, as well as for the early and late termination of work.

Step seven: Stipulate the date of commencement and date of termination of services

Include the dates during which the contractor agreement will come into effect, as well as a final date of completion for the project.

Step eight: State the terms of renewal

Indicate whether the agreement will be automatically renewed after a certain period of time, or whether a renewal requires a brand new contract.

Step nine: Include a dispute resolution clause

Detail the prescribed course of action should a dispute between the two parties arise. Make sure to appoint a third party to rule upon any dispute or conflict that cannot be resolved between the parties.

Step ten: Confirmation of health, safety and insurance compliance

Include a clause that states that the contractor evidences that the employees conduct, machinery and workmanship in compliance with local and regional health and safety regulations including appropriate level of insurance held.

Step eleven: Sign your agreement

A contractor agreement is only legally binding if signed as accepted by both parties. The onus is on you to ensure that the agreement has been signed by a person who has the lawful authority to do so.

While these guidelines will assist you in compiling a contractor agreement, bear in mind that a contract with the wrong maintenance terms could spell disaster for your project. For certainty of obligations, you should always seek a professional opinion prior to committing to a contract.

This article was submitted by Adrian Butcher of Higgins Coatings.