Are These Contract Clauses Reasonable??

[webfeet]

The contract protects the PC and not me! He takes no responsiblity for damage to utilities, patios, driveways, as well as charges me "actual cost + 10%" for other things like unexpected obstacles in excavation. Is this reasonable? I have not signed anything, yet. I think the PC should examine my site and point out any possible problems with site, construction, access, or whatever, and include them in the set price. I.E., I want him to agree to a firm price with no surprises for me. Is this unreasonable? What is reasonable? Thanks for comments.

[sevver]

Get the site located for utilities, anything that comes up will fall on to the locating company(s). As for the Patio driveway etc, he can plainly see that they are there, it comes down to can he do the job himself or not?
But the last one, obstacles in excavation, that is going to fall on you, if he hits a boulder that is ten feet in diameter that he needs to remove, it could make something that costs him way more than his profit allows. I would be careful with what you allow him to get you on though, if it is just hard ground, then sorry, your problem, better luck next time. But something odd, like an old buried tank or something is not fair to charge him for.

[webfeet]

Thanks Sevver, for fast response. I will have all utilities marked, but PC even excluded damage to overhead electrical wires out by the street, (ours are not underground). How do I, diplomatically, address these issues? Moreover, can't we poke rods in the ground to check for underground boulders, etc?

HELP!! The contract even states that we have to look to manufacturer's warranty for all items purchased. Is than routine? There is no mention of PC warranting installation or are anything else. In fact, it states that the sole warranty is what is provided by the wholesalers. Should PC warrant their work and or products? If so, what is a reasonable warranty on a pool installation as described above?

[sevver]

Is the contractor not insured?! That is one scary contract in my opinion. If he is stupid enough to hit the overhead wires, then why should you have to cover the cost? I would have to rethink this guy.
What are you putting in? An above ground pool? If so, what is the deepest that he will have to dig? They have a tool called a probe, it is basically a metal rod with a tee handle on the top, the tip has a pointed tip that is larger diameter than the rod, you could run around and probe for rocks, but not everyone has a probe. I used to install pipe, so finding things underground without ripping them out with a machine was a good thing. So I have one, you can get them at a plumbing supply house, I am not sure how much they are though as I got mine from the company I worked for.
I don't have any experience with pool contractors, but at the very least, they should guarantee their work! Maybe you should put it up yourself. I have been involved with two of them and did not find it daunting at all, but I have been raised around the construction industry.

[webfeet]

Boy your fast, and I am soooo glad. I don't know if he's insured or not, but befor I pick a PC he will not be only insured, but licensed and bonded and I will have copies of everything. The pool is 20'6" x 40'6" Grecian inground 28,000 gal, with 3' shallow end and 8' deep end. I have had 2 quotes so far, and the last one gave me the blank contract to review, only after I asked for it. So, I haven't seen any other PC's contracts, but I am going to get one with every bid I get from now on, and I will pick it apart, but I do want to be reasonable. I wonder if anyone out there would be willing to post a copy of their contract? Just don't want to be "plucked." Thanks again!

[GTakacs]

My builder was really reasonable. They even had a contract checklist for people who don't read the contract just sign with the major points outlined black and white and they went over every single item on it.

The only piece on my contract that I made them chage was that they said that all of their workers are insured but it said nothing about their subs. It said that if they screw something up due to negligence such as hitting the brick wall or fence with a truck they will fix it. I made them add that they also only hire subs that are also insured. I also made them add a clause that they will provide me with a lien waiver at the end of the construction AKA "all subs have been paid in full".

The contract clearly stated that they are not liable for re-routing utilities, ruining landscaping, irrigation system or other damage that is generally associated with the construction. They also weren't liable for driveway cracks so I paid extra for a Bobcat shuttle service so the dump trucks would not drive onto my driveway. The excavators were super careful yet they still managed to crack one corner (about 3'x3' piece) of my driveway with the track backhoe. I'm glad that is all the damage I've had. Overall I think they were very professional.

The only clause in my contract that was added to protect my builder from suprise expense was for a rock clause. It simply outlined that if they hit rock and they have to mount the ram on the backhoe it would be charged as a $600 setup charge plus $250/hr additional charge. My builder capped it at $2000 as worst case scenario. I ended up paying $1600 for the rock 'cause there was plenty where I live.

Other than these, there was one more stipulation relating to the excavation. I had to tell them at excavation time how much dirt I wanted them to leave behind for final grade. If I screwed up and left too little it would cost me extra to have more dirt hauled in. If I left too much it would be my responsibility to haul it away later.

There was a standard clause in there about sending home subs after they showed up on any given day, it would cost $200/incident.

I think that is pretty much all that was in my contract. As you can see most of it was related to the excavation step (it's not the plaster guys who'll crack your driveway). Once passed excavation I was relieved and everything went really smooth.

I also made them add something along the lines of "average build time is 40 days from dig date not including rain delays" just to be sure it gets done. The contract gave them 6 months to finish the pool. They finished in 38 days after dig so they were right on the money.

I can have my contract scanned and posted for you later today if you're still interested.

[ozonedog4]

OK, I am a lawyer, not admitted to practice in Arkansas, I'm in Washington State and my practice has nothing to do with construction contracts, and I have no clue about Arkansas law, and you should not take what I am saying below as authoritative legal advice, or legal advice at all. Obviously, I do not represent you, nor could I.

Having said that, though, let me give you a basic idea of how most jurisdictions construct (i.e. interpret) contracts and why, if the contract essentially says verbatim what you say, the language doesn't really scare me that much.

First, almost every jurisdiction applies what's called an implied covenant of good faith and fair dealing. Moreover, most every jurisdiction allows parties to avoid unexecuted, partially executed, or fully executed contracts that were premised on what is called mutual material mistakes (hereinafter "MMM"). The following is why these two ideas are important, I believe, to your situation.

The implied, or perhaps explicit, covenant of good faith and fair dealing, in this context, would seem at a minimum, whether it is said or not in the contract by the pool contractor, to AT LEAST REQUIRE the pool contractor to install your pool in a commercially reasonable manner. In other words, be reasonably careful and follow reasonable industry standards in performing the installation. So, if some unqualified dude on the crew, drinks a few beers, and hops on the backhoe and decides they are going to run over your patio for fun, and it gets all cracked up, then notwithstanding the language in your contact, you would have a claim for damages under it. In other words, you are not contracting, nor indemnifying the contractor against his, or his agent's, own negligence.

It seems to me that if you ever ended up in court, the court would construe the provision about unforeseen damages as more or less what it says and limited to what it says, that is; if through best efforts, all around, a sewer pipe, for instance, is not found and burst, through no one's negligence, then the contractor is not liable to you for damages. But, you may be asking yourself now; what would you do then. This is where another idea in contracts about mutual material mistakes comes into play, and if I understand your contract correctly, you might be in a decent spot the way it is currently written.

A basic rule is that any party can avoid a contract provision where a mutual material mistake was involved. A mutual material mistake is where both parties (hence, the word "mutual") believed something important (hence, the word "material") was one thing and it turned out to be another (hence, the word "mistake") at the time of contract formation. You obviously, and the pool contractor too, are not going to execute say a $20,000 or $30,000 contract to install a pool if you knew that the exact site of the excavation, just below the surface, had an old 16 foot thick reinforced concrete missile silo that no one knew about. What the idea of mutually material mistakes does is says where a situation like that comes to pass, and it's no one's fault, the contract can then be avoided. That's the general rule, however, your contract has a slight twist, that actually is pretty favorable to you.

Let's keep going with my missile silo hypothetical: Day 1 the backhoe starts to dig and hits solid concrete. You have three options: i) rescind the first contract and write a new contract, or do what's called work a novation of the old one, and change the site; OR, ii) you COULD claim, "[w]ell OK, start blasting, get rid of it" that's what you covenanted to do in our contract: unforseen things, your cost + 10%, there's no mutual material mistake, we talked about unforeseen occurences and that's we executed, after all, Mr. Pool Builder, you wrote the contract; OR iii) you could, rescind the contract on mutual material mistake grounds, get your money back and walk away, having learned that you have a missile silo in your backyard.

Now, the pool contractor is going to, or should anyway, say Mutual Material Mistake and try to get out of the contract. After all, he doesn't want to spend all summer jackhammering a silo; he has other pools to build. But, you either get your money back or have a nonfrivolous claim under your contract to make him get rid of the obstruction. Now, whether you could convince a court to make him get rid of such a thing as a missile silo is one thing, but you could make him get rid of tree roots, sewer pipes, etc., without having to do the work of running around and getting bids, scheduling work, etc.. So, one way to look at the language, in that situation, is it creates some interesting options for you.


Having said the above, I would suggest two things to you. First, ask him/her to get construction insurance for the build and offer to split the cost with him. I'd call your homeowner's insurance agent, you may even find out you have some applicable coverage. It is my understanding on a pool project, this insurance is not that expensive, a couple hundred bucks at the most. Second, put in a sentence, in the contract, if you want, that says the pool builder agrees to install the pool in a "...commercially reasonable manner." Now, as to the last thing, I don't even think that's necessary, but if it would make you feel more comfortable, I'd do it. And, if the pool contractor won't agree to that language, then I'd run as fast as I can away from him/her and get another one.

[webfeet]

Ozone, I am getting the picture. I feel much better.
This forum is fortunate to have a member that is an attorney, who doesn't mind shedding some light on the legal aspects, which many of us do not understand. Especially someone like myself, who's had zero experience with construction contracts.
This pool is a big decision for us, because we are aware that we are digging a hole in the back yard and throwing money into it that we will never get back out, at least not in dollars and cents. We're just hoping to keep a "dream" from becoming a "nightmare". Again, thanks so much, I really appreciate and comprehend your explanations.

[aquarium]

Having worked in construction for a while, but never built a residential pool, I'd say that it -might- be cost-effective to have a geotech firm drill a hole in the center of the deep end location (prior to signing contracts) in order to determine if there is any rock. I say -might- because that alone can cost a few hundred bucks. It's a risk aversion strategy that may not be justified at this level of total project cost. Without that information, you take on the risk of encountering rock or a missle silo. But, if you try to lock in the contractor to a fixed excavation cost, they -should- pad the dollars to pay for the risk they are taking on. So it's a trade-off.

In urban areas there is usually a well-known geological pattern that has been developed over time, and a good geotech firm will have that on file. A good pool company that has some experience will know where to get this information and shouldn't be too surprised with what they dig up in your back yard.