Terms & Conditions For Tradesmen

[MASSEY]

I am flirting with the idea of getting some terms and conditions sorted out because we've got a customer lined up who wants to withhold a big portion of the balance until the final payment. We usually have the majority of money in advance and leave a small final payment of less than £1000, this customer wants to withhold much more so I'd like to avoid room for discrepancy.

I have a few questions regarding T&C's and i have also found some T&C's for free on the web that seem to me to be pretty much what i am after and wouldn't mind some feedback on them, they aren't that long and could probably be squeezed down to a couple of pages if font size was 11px.

First question, is it not obvious to both you, the customer and pretty much everyone that you do not work for free and, therefore, anything outside of your original quotation in terms of extras will be chargeable, are there not laws that account for common sense without having to have clauses in T&C's?

Do most terms and conditions for services include sections that basically say if we damage something while carrying out the service we are not responsible? I have public liability and would, of course, claim if we caused some bad damage, but the clauses in the free T&C i have posted below seem to suggest that the service provider will take care but if we, for instance, scuff a bit of posh wallpaper while going about our daily business, it's your problem? The reason i ask is because this customer is a bit weird about his carpets, even though they aren't the best, and the last thing you want is someone kicking up a fuss over a bit of dust or a negligible stain as a result of relatively invasive works.

Also, it says in the T&C that the customer does not own the goods until full payment has been made, which is a fair term i think but really you want your T&C to ensure that you do get paid, so i couldn't envisage a scenario outside of the customer simply running out of money that would result in us wanting to break in and rip out everything we have supplied because they do not own it.

How do your present the T&C, is is ok to put at the bottom of the quote 'subject to T&C's which can be found at and then link to a web address page or suggest that they can request a copy, or do you shrink them down to the tiniest font possible in light grey and put it on the back of the quote? haha.

I'd like to strike a balance between protecting ourselves financially, and not treating the customer like a mug.


This is the T&C below, grateful for any input.

 

[MASSEY]

THIS AGREEMENT IS MADE ON THE

(Date)


BETWEEN



“The Supplier”

(Name and address of the Business offering the service)


AND


“The Client”

(Name and address of the Client)



IT IS HEREBY AGREED AS FOLLOWS


1. Interpretation

1.1. Except where the context requires otherwise words importing the masculine shall include the feminine; words importing the singular shall include the plural; words importing natural personage shall be equally applicable to corporate personage and vice versa.

1.2. References to any statutory provision, authority, rule or code of practice shall be deemed to include the amended versions, replacements or successors of such.

2. Relationship Between the Parties

2.1. The Client engages the Supplier to provide the services specified in these terms and conditions and attached schedules.

2.2. No term of this agreement or course of dealings between the parties shall operate to make the Supplier an employee or agent of the Client.

2.2. Neither party shall assign or transfer any of their rights, liabilities or obligations arising under this agreement without the prior written consent of the other party.

3. The Quotation

3.1. The Supplier shall provide to the Client a proposal for the services to be provided (“the Quotation”) which shall set out:

a) The services which the Supplier will undertake for the Client.

b) The date or time period within which the service will be performed.

c) The costs which the Client shall be charged for the performance of the services including:

i. Any fees which the Supplier shall charge.

ii. Any disbursements or expenses which the Supplier will require the Client to meet (including but not limited to the costs of materials).

iii. Any VAT or tax element which will be payable by the Client.

The Quotation shall be attached to these terms and conditions as a schedule and where a contract is entered into between the Supplier and the Client, the Client will be deemed to have accepted the content of the Quotation in full.

 

[MASSEY]

4. The Services and the Time and Manner of their Delivery

4.1. The Supplier will provide such services to the Client as are set out in the Quotation.

4.2. The services will be provided to the Client within the timeframe specified in the Quotation.

4.3. Time frames and dates of delivery are provided for guidance only and the Supplier makes no guarantee that the services will be performed within the specified period. For the purposes of this agreement, time shall not be of the essence and the Supplier shall not be liable for any loss or damage suffered by the Client as a result of the delivery of services being delayed or postponed for any reason.

4.4. Any drawings, descriptions, plans, catalogues, promotional materials or concept designs are for the purposes of illustration only, and except where specified otherwise they are approximations and are not intended to be a full and exact representation of the services.

5. Payments

5.1. The contract price is set out in the Quotation, which includes details of the charges which the Supplier will make for labour, materials and parts as well as any taxes or additional costs or expenses or disbursements which the Supplier may charge to the Client.

5.2. The intervals at which the Supplier may invoice the Client in respect of the whole or an installment of the contract price are set out in the Quotation.

5.3. Notwithstanding 5.1 and 5.2 above, the Supplier may vary the contract price from the amount set out in the Quotation where he has provided services which are different or in addition to those set out in the Quotation either at the specific request of the Client or because he has been required to complete additional work which was not anticipated at the time the Quotation was made, or because of market fluctuations in the price of materials.

5.4. The Client agrees:

a) Not to withhold any sums due to the Supplier.

b) To settle all invoices raised by the Supplier within days.

c) To pay to the Supplier interest at a rate of percentage points per annum above the Bank of England base rate on any payments which are not settled in accordance with section 5.3(b).

d) To pay to the Supplier such costs and expenses as he may incur in recovering payment from the Client where the Client fails to make payment in accordance with these terms and conditions.

6. Cancellation

In accordance with the Cancellation of Contracts Made in a Consumer's Home or Place of Work etc Regulations (2008), and where the Client is a consumer within the meaning of section 12 of the Unfair Contract Terms act 1977, the Client may cancel this contract within 7 calendar days of signing this agreement (or within whatever extended period the Supplier may specify in the Quotation) and shall be entitled to a full refund of any monies paid to the Supplier, less an amount representing any reasonable administration costs which the Supplier has incurred. Any cancellation outside this period will not entitle the Client to a refund of any monies paid.

 

[MASSEY]

4. Client’s Obligations

4.1. The Client shall be responsible for the correctness of all measurements for products or materials which he gives to the Supplier. Where these measurements are not correct and accordingly materials or products which are ordered or provided by the Supplier are the wrong size, the Client shall bear the expense of rectifying this.

4.2. The Client shall co-operate with the Supplier as may be necessary to facilitate this agreement, including but not limited to:

a) Permitting the Supplier access to the property or location in which the services are to be supplied (“the Site”) and assuring that such access is appropriate and adequate.

b) Providing for the Supplier such facilities as may be necessary in order to allow him to complete the services.

c) Following the Supplier’s reasonable instructions relating to safety and the state of work which has recently been completed by the Supplier or is in the process of being completed or to the state of the Site in general, including directions and restrictions on appropriate usage, care and maintenance.

4.3. Unless the Quotation specifies otherwise, the Client will be responsible for any cleaning and redecorating which is necessary to the Site after the Supplier has completed the agreed services (with the exception of the removal of waste materials, which shall be the responsibility of the Supplier as set out in 7.4, below).

4.4. Where the Supplier stores or keeps any materials or equipment on Site, the Client shall be responsible for the security and safety of such and shall account to the Supplier for any loss or damage.

4.5. The Client shall be responsible for any permissions, licences or consents which are necessary in order for the services to be provided. The Client warrants that he has applied for and obtained all such necessary permissions, licence or consents prior to contracting the Supplier.

4.6. The Client shall clear the site of all furniture and property prior to the Supplier commencing work. This includes any old kitchen units or fixtures, except where the Quotation specifically provides that the Supplier will remove these.

5. Supplier’s Obligations

5.1. The Supplier shall perform all duties, services and obligations under this contract with reasonable care and skill and to a reasonable standard. He shall comply with all relevant codes of practice and statutory or regulatory requirements.

5.2. Whilst the Supplier shall take all reasonable steps to match his work to existing colours, finishes or other aesthetics (as the Client may direct) he cannot guarantee any such match.

5.3. The Supplier shall take all reasonable care with the Client’s property, including taking reasonable steps to protect the Client’s furnishings and wall and floor coverings during the provision of the services but cannot take responsibility for any damage which is caused.

5.4. The Supplier shall be responsible for managing and arranging the safe and lawful disposal of any waste materials which are generated or removed from the Client’s property as a result of the provision of the services.

5.5. The Supplier shall at all times hold a valid employer and public liability insurance policy and shall hold and keep up to date any and all licences or permits as may be required in order to provide the services.

 

[MASSEY]

4. Property Rights and Assumption of Risk

4.1. Any property rights, title or ownership in any property or materials which are used by the Supplier in providing or delivering the service shall remain with the Supplier until the Client has made payment in full in accordance with these Terms and Conditions.

4.2. Risk in and responsibility for any products or materials which are used in the supply, performance or delivery of the services shall pass from the Supplier to the consumer

a) Where the Supplier is responsible for delivering the products or materials to the Client, upon delivery; or

b) Where the Supplier is not responsible for delivery, at the moment the products or materials leave the Supplier’s premises.

5. The Guarantee

5.1. The Supplier provides to the Client, in addition to any statutory rights which the Client may have, a guarantee that the services provided under this contract shall be free from defective or flawed materials or workmanship for a period of [months/years] from the completion of the services, notwithstanding that this guarantee shall not apply to:

a) Defects or flaws which are as a result of any misuse, failure to adequately and properly maintain, neglect or failure to follow instructions or recommendations on the part of the Client.

b) Any defect or flaw which is caused by mechanical or chemical damage (which is not in itself a result of some defect in the workmanship or materials) and which arises after risk in the property has passed to the Client.

5.2. The Supplier shall, at his sole discretion, determine the manner in which he will satisfy this guarantee, whether by repairing re-performing or replacing the services or by refunding to the Client all or part of the monies which have been paid.

5.3. Where the Client considers that the services are defective upon delivery or performance then he shall notify the Supplier of this within days, failing which he shall not be entitled to claim the benefit of this guarantee.

5.4. This guarantee shall not become effective until the Client has paid the Supplier in full, failing which the Client shall not be entitled to claim the benefit of this guarantee.

6. Termination

6.1. This agreement shall continue until the services (or any mutually agreed addition, extension or variation thereof) have been provided, or until terminated in accordance with the below.

6.2. Without prejudice to the above this agreement may be terminated immediately where any of the following circumstances arise:

a) Either party commits a serious breach or persistent breaches of this agreement including but not limited to the non-performance, neglect or default of any of his duties as outlined herein (including a failure on the part of the Client to make payment within agreed timescales) and after notice of this breach has been given to the defaulting party it remains unremedied and unrectified days after such notice.

b) Either party commits a breach of this agreement which cannot be remedied.

c) Either party becomes insolvent or enters into a CVA or IVA or ceases to carry on the whole or substantially the whole of its business.

6.3. Upon termination of this agreement the Client shall pay to the Supplier such sums as may represent work done and expenses incurred up to and including the date of the termination.

6.4. Any right to terminate this agreement shall be without prejudice to any accrued rights or liabilities arising out of this agreement which are in existence at the date of termination.

 

[MASSEY]

4. Disclaimers and Exclusions

4.1. The Supplier shall not be responsible in any circumstances to the Client or any third party for any loss of profit or indirect or consequential economic damage or loss, howsoever caused, whether as a result of negligence, misrepresentation, breach of contract or otherwise.

4.2. Nothing in the forgoing shall be read as restricting or limiting in any way the Supplier’s liability for death or personal injury.

5. Indemnity

The Client shall indemnify the Supplier against any loss or damage which results from the Client’s breach of this agreement or failure to abide by any of its terms.

6. Force Majeure

Neither party shall be liable for any delay or failure in performing its obligations or duties under this agreement which results from circumstances outside his reasonable control including but not limited to acts of God, industrial action, war, fire, threat of terrorism, civil disturbance or rioting, government or regulatory action, breakdown in plant or machinery or shortage of raw materials or supplies.

7. Warranty of Contractual Capacity

Both parties and the signatories to this agreement warrant that they are authorised and permitted to enter into this agreement, and have obtained all necessary permissions and approvals.

8. Whole Agreement, Governing Law, Severability and Miscellaneous Provisions

8.1. This document constitutes the entirety of the agreement between the parties. It supersedes any prior representations which may have been made, whether orally or in writing. Any modification to this agreement must be made in writing and signed by both parties.

8.2. This agreement shall be governed by the Law of England and Wales and the parties agree to submit to the exclusive jurisdiction of the English Courts.

8.3. All clauses, sub clauses and parts thereof shall be severable and shall be read and construed independently. Should any part of this agreement be found invalid this will not affect the validity or enforceability of any other provision or of this agreement as a whole.

8.4. All terms, conditions and covenants contained in this agreement shall bind the parties and their heirs, legal representatives, successors to title and permitted assignees.

8.5. Nothing in these terms and conditions shall incur any rights on a third party and no third party may enforce any provision of this contract under the Contracts (Rights of Third Parties) Act.

8.6. The failure by either party to enforce any provision of this agreement shall not be deemed a waiver or limitation of that part’s right to subsequently compel and require strict compliance with every provision of this agreement.













IN WITNESS OF WHICH the parties have executed this agreement on this day and date.


On behalf of the Supplier




(Sign)




(Print Name)




(Position if signing on behalf of a company)




(Date)


On behalf of the Client


___

(Sign)




(Print Name)




(position if signing on behalf of a company)




(Date)

 

[ethical PR]

Are you really expecting someone to read through that lot?

Stop being a tightwad - pay a solicitor to develop some terms and conditions for you that is based on the needs of your business. A template from the internet is unlikely to be robust enough to cover you.

 

[MASSEY]

Are you really expecting someone to read through that lot?

Stop being a tightwad - pay a solicitor to develop some terms and conditions for you that is based on the needs of your business. A template from the internet is unlikely to be robust enough to cover you.

How would you know, you've not read it

Was you never taught to skim read at school?

 

[Carl Mintern]

Tl;dr

Wrt how to impose acceptance, we simply send our ts&cs with our quotes, and at the bottom of every quote it states "by accepting the quote you agree to our terms and conditions".

We also send a copy of our standard day work rates. One item in our ts&cs is something along the lines of, anything outside the work quoted for is chargeable at our standard hourly rates.

Obviously you need a detailed, comprehensive written quotation as this is the most important thing when it comes to getting paid. I find that in almost every instance of a tradesman not getting paid it is because SOMETHING was wrong with the client's expectation of what was being contracted, be that quality of work or materials, or scope of work.

 

[MASSEY]

Tl;dr

Wrt how to impose acceptance, we simply send our ts&cs with our quotes, and at the bottom of every quote it states "by accepting the quote you agree to our terms and conditions".

We also send a copy of our standard day work rates. One item in our ts&cs is something along the lines of, anything outside the work quoted for is chargeable at our standard hourly rates.

Obviously you need a detailed, comprehensive written quotation as this is the most important thing when it comes to getting paid. I find that in almost every instance of a tradesman not getting paid it is because SOMETHING was wrong with the client's expectation of what was being contracted, be that quality of work or materials, or scope of work.

Our quotes are usually detailed and spot on, but as you say the clients expectation can be hard to interpret and it is with this particular customer because of various things like replastering chases for cable and floating in and repainting. We can do it, but the rest of the wall around where we have chased doesn't look the best, so we don't want to end up with someone saying their walls were perfect before we turned up etc. It wouldn't be so much of an issuse if the final payment was lower because you have more barganing power then.

I guess a few pictures being taken before and after may come in handy.

 

[avalanche]

Can you not negotiate better terms with the client, The industry standard is usually to invoice a valuation of the work done on the quote with 5% retention, i would get a red flag from a client wanting to hold back more.
I don't know what your payment terms are but if you were invoicing every 2 weeks and giving them a further week to pay they are still going to be a weeks work + 5% ahead

 

[MASSEY]

Can you not negotiate better terms with the client, The industry standard is usually to invoice a valuation of the work done on the quote with 5% retention, i would get a red flag from a client wanting to hold back more.
I don't know what your payment terms are but if you were invoicing every 2 weeks and giving them a further week to pay they are still going to be a weeks work + 5% ahead

Hi,

Our terms are x amount on week1 x amount on week 2, etc etc with final payment on completion. Our payment terms have always suited us, but as i say, this customer has a specific figure in mind of what he wishes to withhold until completion. The figure is 30% of the total. On a job we are just finishing, the remainder is £700 which is probably between 5 and 6 % of the total.

When you say industry standard do you mean for services, in general, leaving 5% is standard?

It does raise a flag and we have discussed it but when it was mentioned to the customer on the second visit they seemed pretty assured that was the way they wish to do things which is why i have been thinking about getting some T&C's in case this is the customer from hell we have managed to avoid so far.

 

[avalanche]

All my work is sub-contract so a bit different but the 5% retention is usually payable 6-12months after practical completion.
If you are getting weekly payments it is not so bad as they don't really have much on you, I suppose it comes down to your gut instinct if you are comfortable with the clients but i tend to work on the principle of the higher i feel the risk is the more I markup the job to compensate for it.
In your case i would have made sure that everything was covered and at least the 30% is profit
You said everything is properly detailed so you are covered there, I would make sure that every conversation about details and changes is followed up by email so you have a record.
I would imagine they want to snag the job before paying the 30% so I would put in your terms that once it has been snagged they are only entitled to hold back a fair value of the snags they have found and not hang onto the full 30% because a few screws are missing out of a door and they are never in to let you rectify the problem

 

[MASSEY]

All my work is sub-contract so a bit different but the 5% retention is usually payable 6-12months after practical completion.
If you are getting weekly payments it is not so bad as they don't really have much on you, I suppose it comes down to your gut instinct if you are comfortable with the clients but i tend to work on the principle of the higher i feel the risk is the more I markup the job to compensate for it.
In your case i would have made sure that everything was covered and at least the 30% is profit
You said everything is properly detailed so you are covered there, I would make sure that every conversation about details and changes is followed up by email so you have a record.
I would imagine they want to snag the job before paying the 30% so I would put in your terms that once it has been snagged they are only entitled to hold back a fair value of the snags they have found and not hang onto the full 30% because a few screws are missing out of a door and they are never in to let you rectify the problem

The services we offer are domestic so we always ask weekly payments, the jobs usually only last a month, maybe 6 weeks tops.

The plus side of this job is that the majority of the work is labour intensive, but what is funny is that the customer pointed this out themselves which again raises a slight flag.

I like your idea about fair retention for snags... i wonder how that could be worked into terms and conditions.

 

[avalanche]

I don't know what type of work you do but i do joinery so the way I would do it is my quote would detail all the items with a cost for each so for example if there were 10 doors and 1 was snagged due to damage or it was sticking, I would ask that they pay for 9 doors and hold back money for the 1 door + maybe a bit more, so say a door was £10 I would let them hold back £10-£20
If a joint in a piece of skirting was a bit dodgy i would let them hold back 10-20% of the skirting value assuming there is about 100m of skirting in total

For your contract I would word it something like ....the final 30% is payable upon practical completion, a sum maybe held back in the event that there are incomplete or snag items to be rectified but this sum must be a fair valuation based on the quoted amounts and will become payable on completion of the outstanding items. Any unpaid amounts deemed above a fair amount for any outstanding items will be liable to interest charged at xxxx
Any uncompleted or rectified work will be completed as soon as is practical and access will be required to complete the work, no claim can be made for incomplete work if access is not possible in a reasonable time

 

[MASSEY]

I don't know what type of work you do but i do joinery so the way I would do it is my quote would detail all the items with a cost for each so for example if there were 10 doors and 1 was snagged due to damage or it was sticking, I would ask that they pay for 9 doors and hold back money for the 1 door + maybe a bit more, so say a door was £10 I would let them hold back £10-£20
If a joint in a piece of skirting was a bit dodgy i would let them hold back 10-20% of the skirting value assuming there is about 100m of skirting in total

For your contract I would word it something like ....the final 30% is payable upon practical completion, a sum maybe held back in the event that there are incomplete or snag items to be rectified but this sum must be a fair valuation based on the quoted amounts and will become payable on completion of the outstanding items. Any unpaid amounts deemed above a fair amount for any outstanding items will be liable to interest charged at xxxx
Any uncompleted or rectified work will be completed as soon as is practical and access will be required to complete the work, no claim can be made for incomplete work if access is not possible in a reasonable time

We do mostly everything, this particular job is a kitchen supply and fit plus rewiring. We generally list everything we're doing on the quote and the price to do the lot rather than break down elements with different prices.

I think my best bet will be to tweak around with the existing template i have, which i think fits well, and then approach a legal bod to tweak about with it, making sure i incorporate your suggestion. They can then tell me whether it is legal or a sack of rubble.

 

[avalanche]

Yes that would be your best bet, I think the important thing is that not only is it legal but fair to both parties

 

[Carl Mintern]

We supply a payment schedule to our clients upon job acceptance.

I have altered it over a period of time to go like this-

At stage X- payment y
For all stages, with final stage being 'snagging complete' with a small payment. So upon completion I get payed, then a small amount withheld for snagging.

As mentioned above, it is not unusual to leave 5% for 6 months.

Only once have I been asked to make the retention payment bigger, and my response was as follows- "I have costed the work and the payments are in line with that costing to allow me to complete the project. I would be happy to raise the last payment but the only way to do so would be to increase the margin on the work as all other payments must remain as they are to allow work to proceed."

Can't remember exactly how I worded it, but I made it clear that they could increase the final payment as much as they liked, but only by increasing the total amount payable by the same figure. It worked a treat.