Home-Improvement Contract a Must

A state law requires that all home-improvement contracts for work worth more than $500 must be in writing and signed by both parties. Any changes to the contract must also be in writing. So if you decide to expand the closet by two feet at the last minute, write it down and have your contractor sign. (The law only applies to licensed contractors.)

What will happen if you don't have a written contract? The law says a violation is a misdemeanor, but I can't imagine any busy prosecutor wanting to send you or your contractor to jail because there was no written agreement.

More important, will you be able to use the oversight--no written contract--as an excuse not to pay? Should you laugh in the contractor's face when presented with the bill and say, "Oops, we forgot to sign a contract"?

Oral Agreements

You may not be able to get away without paying even if there is not a written contract, depending on the circumstances. There have been at least two California cases in which appellate courts decided that the bills had to be partially paid, even though there were only oral agreements between the contractors and the homeowners.

In both those cases, the homeowners were sophisticated customers. The law had been designed to protect unsophisticated consumers, so allowing the contracts to be enforced in these individual cases would not violate the underlying public policy, the courts noted in each case.

In addition, the courts decided that the law--even though it seemed to ban anything but written contracts--did not make every oral agreement for home improvement automatically void. Each contract would have to be treated on a case-by-case basis. Besides, the courts added, it would be inherently unfair to allow the homeowner to keep the benefits of the work without some compensation.

It might keep you out of court and will certainly make it easier for everyone in the long run if you always insist on a written contract for remodeling and especially for extensive construction work. You should also put any amendments to the agreement in writing, which might alleviate some arguments when it comes time to pay the bill.

Contract Subjects

In his book "Make Your Own Contract," lawyer Stephen Elias lists many of the subjects that should be covered in any personal-service agreement, such as a home-improvement contract. They include: amount and method of payment, a detailed description of the work to be done, the materials that will be used and who will pay for them, a specific deadline for completion and what happens if performance is late or unsatisfactory.

Elias also includes a sample-form contract with fill-in-the-blank choices and a detailed discussion of many related contractual legal issues. (See Chapter 8.) The book sells for $12.95 and can be ordered from Nolo Press, 950 Parker St., Berkeley, Calif. 94710, telephone (415) 549-1976.

Attorney Jeffrey S. Klein, The Times' senior staff counsel, cannot answer mail personally but will respond in this column to questions of general interest about the law. Do not telephone. Write to Jeffrey S. Klein, Legal View, The Times, Times Mirror Square, Los Angeles 90053.

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