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Home Construction Contract Provisions to Stem Botched Jobs

UPDATED: February 9, 2020

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To ensure that a builder doesn't botch a job, the owner should place language in the construction contract providing for the right to withhold payments or take an offset or deduction against the contract sum if the builder quits or fails to build to code.

Owner Inspection Provision in Construction Contract

The main point you want to express as an owner to your builder is that you have the right to inspect the property and approve the work before the final payment is made. One way to do this is to add an “Inspection and Final Payment” provision into the contract which should include the following:

  • Requirement that periodic inspection will be made by you;
  • Requirement that progressive inspections are made by the various county inspectors, such as the water and electrical building inspectors;
  • Requirement of a final inspection by the building inspector;
  • Right to refuse to approve the work if the building inspector finds defects;
  • Requirement of the builder to remedy mistakes found upon inspection.

Owner Provision Requiring Builder to Follow Applicable Building Codes

It's also important to include a separate section in the construction contract to specify your expectations that the building meet proper codes. An example of how to phrase this might be:

“The builder shall perform all work in a good and workmanlike manner and in conformance with all applicable government code provisions as interpreted by the county building inspectors, whether or not specifically mentioned in the work write-up and drawings for the work.”

Owner Provision Specifying Builder Warranties

The final section of the construction contract should include a reminder of the builder’s warranties. This provision can be worded as follows:

“The builder warrants and guarantees to the owner that all materials and equipment used in the work are new, unless otherwise specified, and that all work is of good quality, free from faults and defects. All work not conforming to these standards and not in conformance with the work write-up will be considered defective. The work completed by the builder is to be guaranteed in full for one year from the date of final approval. The builder will also turn over to the owner all manufacturer’s and supplier's written guarantees and warranties, covering materials and equipment furnished under the contract.

If you plan to draft a construction contract, you should consider contacting a local construction attorney for help rather than doing it yourself. Construction attorneys not only help draft construction contracts but also can explain building codes and zoning laws in your area.

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