- Termination after Initial Payment. After initial payment, the Owner
may not cancel or terminate the contract unless the Owner: (1) pays
Contractor a cancellation fee of 10% of the Contract Price and (2) pays
Contractor for all labor and materials incurred on the project on a time and
materials basis. - Final Payment. Final payment (the remaining balance of the Contract
Price including any withheld payments) is due within three (3) business
days of the date when Contractor finishes all punch list work and submits
Contractor’s final Draw Request or Request for Final Payment, whichever
is later. At the time of Substantial Completion, Owner shall inspect the
Work and provide a punch list within three (3) days of Contractor’s notice
(the “punch list deadline”). If a punch list is not provided by the punch list
deadline, final payment is due within three (3) business days of the date
Contractor submits its final Draw Request or Request for Final Payment.
Any punch list work identified after the punch list deadline shall be warranty
work and shall not delay final payment. To be clear, even after Final
Payment, Contractor will honor its warranty. There shall be no more than
2 punch lists, after which all punch list work shall be considered warranty
work. Upon request of the Owner and after receipt of Final Payment,
Contractor shall provide complete and legally effective releases or waivers
of all potential liens arising out of or filed in connection with the Work. - Interest. Payments due and unpaid to Contractor shall bear interest
at the rate of the lower of 18% per annum or the maximum rate allowed by
law at the place of the Work. Any interest that could be considered usurious
is hereby disclaimed and any amount owed shall be automatically reduced
to not be usurious. - Contractor’s Representation. Contractor has familiarized itself with
the Contract Documents, Work site, locality, and all local conditions and
laws and regulations that may affect cost, progress, performance or
furnishing of the Work. Contractor, or its employees or subcontractors, are
duly licensed to perform the Work as required by local laws and
regulations. - Contract Documents. The Contract Documents which comprise the
entire Contract between Owner and Contractor about the Work consist of
the Contract signed with the Owner, Exhibit A (description of the Work),
Exhibit B (the Plans and Specifications, if any), (4) all Change Orders, and
(5) these General Conditions. - Contractor’s Responsibilities. Contractor will: (1) perform the Work
per the Contract Documents and the standards of good and workmanlike
construction applicable in the area, (2) be solely responsible for the means,
methods, techniques, sequences and procedures of the Work, (3) provide
competent, suitable personnel to perform the Work, (4) maintain good
discipline and order at the Property, and (5) furnish and be fully responsible
for all materials, equipment, labor, and incidentals necessary for the
furnishing, performance, and completion of the Work, unless excluded onExhibit A or B. All materials and equipment shall be of good quality and new, except as otherwise provided in the Contract Documents.
6.1. Subcontractors. Contractor will be responsible for all acts and
omissions of its subcontractors, suppliers and other persons and
organizations performing any of the Work under a direct or indirect contract
with Contractor. Nothing in the Contract Documents shall create any
obligation by Owner to pay any subcontractor, supplier or other person or
organization directly except as may otherwise be agreed in writing, as
stated in Exhibit A or B, or required by laws and regulations.
6.2. Permits; Inspections. If specifically stated in Exhibit A or B,
Contractor will obtain and will pay for all construction permits, licenses, and
inspection fees, which will part of the Construction Costs. If permits,
licenses, and/or inspections fees are not addressed in Contract
Documents, such will be addressed by a Change Order if required which
will be an additional Construction Cost which will be paid by Owner and will
increase the Contract Price. Owner shall assist Contractor, when
necessary, in obtaining such permits and licenses.
6.3. Taxes. Contractor shall pay all sales, consumer, use and other
similar taxes required to be paid by Contractor under the laws and
regulations of the place of the Work applicable during the performance of
the Work, which are part of the Construction Costs, unless excluded in
Exhibit A.
6.4. Use of Premises. Contractor shall be responsible for any
damage to the Property resulting from performing the Work, unless
excluded on Exhibit A. Contractor shall keep the Property reasonably free
from accumulations of waste materials, rubbish and other debris, and at
conclusion of the Work shall remove all waste materials, rubbish and debris
from and about the Property.
6.5. Damage to the Work. Contractor shall repair or replace, at
Contractor’s sole expense, every portion of the Work damaged or
destroyed before Final Completion and caused in whole or in part by the
acts or omissions of Contractor. Notwithstanding the foregoing, Owner
shall pay for such repair or replacement if the sole cause of the damage or
destruction of the Work was Owner’s negligence.
6.6. Warranty. Contractor warrants and guarantees to Owner that all
Work will be in accordance with the Contract Documents and will not be
defective. If within one (1) year after the date of Substantial Completion or
such longer period of time as may be prescribed by laws or regulations or
by the terms of any specific provision or applicable special guarantee in
the Contract Documents, any Work is found to be defective, Contractor
shall promptly, without cost to Owner, either correct such defective Work,
or if it has been rejected by Owner, remove it from the Property and replace
it with non-defective Work.
6.7. Indemnity and Hold Harmless; Waiver of Consequential
Damages. Contractor shall indemnify and hold harmless Owner against all
loss, liability, cost expense, damage and economic detriment of any kind
that arises out of or results from performance of the Work but only to the
extent caused in whole or in part by the acts or omissions of the Contractor.
Notwithstanding the forgoing, Contractor and Owner waive all claims
for consequential damages of any kind or character arising out of this
Contract.
- Insurance.
7.1. Contractor’s Insurance. Contractor shall purchase and maintain
such comprehensive general liability and other insurance as is appropriate
for the Work being performed.
7.2 Owner’s Insurance. Owner shall purchase and maintain Owner’s
homeowners insurance or liability insurance and other reasonably
appropriate insurance. If Owner is occupying the Property during the Work,
Owner shall maintain their homeowner’s insurance on the property.
Contractor and Owner waive subrogation against the other.
- Termination.
8.1 Termination by Owner. If the Contractor materially breaches any
of its obligations under this Contract, then Owner may terminate this
Contract after giving Contractor a 14-day notice and opportunity to cure,
provided that if any such breach cannot be cured within such time that
Contractor begins to cure and diligently prosecutes cure to completion. If
not, Owner may terminate this Contract and take possession of the Work.
Alternatively, instead of terminating the Contract, Owner may cure any
remaining breach and deduct the cost thereof from amounts otherwise
owed to the Contractor.
8.2. Termination by Contractor. If the Owner materially breaches any
of its obligations under this Contract, then Contractor may terminate this
Contract after giving the Owner 14 days’ notice and opportunity to cure,
provided that if any such breach cannot be cured within such time that
Owner begins to cure and diligently prosecutes cure to completion. If not,
Contractor may terminate this Contract, shall have no further obligation to
perform the Work, and shall maintain all rights in law or in equity for
damages, including the right to recovery of profit and overhead. - Dispute Resolution; Mediation/Arbitration. If a dispute arises
from or relates to this contract or the breach thereof, and if the dispute
cannot be settled through direct discussions, the parties agree to endeavor
first to settle the dispute by private mediation with a mediator agreed to by
the parties. The parties further agree that any unresolved controversy or
claim arising out of or relating to this contract, or breach thereof, shall be
settled by binding arbitration privately administered in accordance with the
Construction Industry Arbitration Rules of the American Arbitration and
judgment on the award rendered by the arbitrator(s) may be entered in any
court having jurisdiction thereof. Claims shall be heard by a single
arbitrator. The parties shall agree on the single arbitrator within fourteen
(14) days of the commencement of arbitration. Failing to reach agreement,
each party shall select one person (who must be an attorney or AAA
approved arbitrator) to act as arbitrator selector and the two selected shall
select an arbitrator within ten days of their appointment, and such person
shall serve as the single arbitrator for the arbitration. The two arbitrator
selectors shall then be discharged. The arbitrator shall be a licensed Texas
attorney with at least 10-years experience in construction law, or a retired
Texas judge. The place of arbitration shall be Bastrop, Bastrop County,
Texas, unless agreed by the parties. The arbitration shall be governed by
the laws of the State of Texas. If the dispute is less than $5,000 there shall
be no discovery other than the exchange of documents. If the dispute is
over $5,000, discovery shall be determined in the sole discretion of the
arbitrator upon motion and/or request of the parties. The arbitration will be
based on the submission of argument and documents and there shall be
no in-person or oral hearing. - Time is of the essence for any arbitration under this agreement and arbitration hearings shall take place within 60 days of filing and awards rendered within 90 days. The Arbitrator shall agree to these limits prior to accepting appointment. The Arbitrator will have no authority to award punitive or other damages not measured by the prevailing party’s actual damages, except as may be required by statute. The Arbitrator shall not award consequential damages in any arbitration initiated under this section. Any award in an arbitration initiated under this clause shall be limited to monetary damages and shall include no injunction or direction to any party other than the direction to pay a monetary amount. The Arbitrator shall award to the prevailing party, if any, as determined by the Arbitrator, all of their costs and fees. “Costs and fees” mean all reasonable pre-award expenses of the arbitration, including the arbitrator’s fees, administrative fees, travel expenses, out-of-pocket expenses such ascopying and telephone, court costs, witness fees, and attorneys’ fees. The award of the Arbitrator shall be accompanied by a reasoned opinion. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction thereof.
- Confidentiality: Except as may be required by law, neither a party nor an arbitrator may disclose the existence, content, or results of any arbitration hereunder without the prior written consent of both parties. The parties agree that failure or refusal of a party to pay its required share of the deposits for arbitrator compensation or administrative charges shall constitute a waiver by that party to present evidence or cross-examine witness. In such event, the other party shall be required to present evidence and legal argument as the arbitrator(s) may require for the making of an award. Such waiver shall not allow for a default judgment against the non-paying party in the absence of evidence presented as provided for above.
- For disputes under $2,500, the Contractor may waive mediation and arbitration and proceed to file a claim in Justice Court in Bastrop County, Texas.
- Miscellaneous.
13.1. No assignment of this Contract, or any right thereunder, is valid
or binding without all parties written consent.
13.2. Owner and Contractor each binds itself, its partners,
successors, assigns and legal representatives, to the other party, its
partners, successors, assigns and legal representatives regarding all
covenants, agreements and obligations in the Contract Documents.
13.3. This Contract and all issues, disputes and matters arising out of
it shall be governed by and construed in accordance with the law of the
state of Texas. Venue for any dispute is Bastrop County, Texas.
13.4 These General Conditions are subject to change at any time. Any
changes will be updated on this website.
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