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Everything You Need To Know


Construction Canada.com
is not only Canada's Online Construction Directory, providing effective exposure for contractors, manufacturers, suppliers, decorators, trades people, etc. We are also here to provide you, the consumer with the knowledge and the know-how required to select a reliable contractor for the best possible results - results that you will be happy with.

This section will teach you what to look for when you're finding a contractor, selecting a contractor, contractors to be aware of, getting bids, the contract and the contractor, paying for the work and even how to deal with problems that may arise.

 

Finding A Contractor

Before selecting your contractor, make sure you know exactly what you want done. Consult with your family and write down a full description of the work you want. This will best illustrate what you need and it will also ensure that the contractor knows what the job requires. It will also ensure that the contractors bidding for the job are all bidding on the same thing.

That's right - contractors PLURAL! Find at least two or three contractors to bid on the work you require. Remember that "word of mouth" is one of the contractor's best (or worst) friends. Try to think of a friend, neighbor, or family member that may have had the same or similar work done in the last few years. A recommendation from a trusted source is always a good place to start. Try to use other people's experiences (good & bad) to your advantage.

After using Construction Canada.com, some other good resources for finding a contractor are local hardware and building supply stores. Some of the larger stores provide some home contracting services themselves and offer the same guarantees they apply to their retail sales.

Municipal licensing offices and building departments right in your own area may also be able to offer you contacts for reliable contractors. Don't forget - local home building and trade associations. They can also offer the names of members who do home renovations and remodeling. For an extensive listing of Home Building & Trade Associations across the country, Click Here

Try to find businesses that have been operating in your area for a number of years. If you have the time, drop by their offices for an introduction or even for a little look-see.

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Selecting A Contractor

Remember that a pleasant manner, an "honest face" or the way someone talks is no assurance of reliability.

Whether you're using a contractor by recommendation or by your own choosing, ask for their business license number and ask them how long they have had it. Check this information with the local licensing office. Find out if they carry public liability and property damage insurance. Ask for the name of their insurance carrier and call them to verify that their policies are in force.

Acquiring references in your area is also a good idea. Call and check the references, as most people will be glad to help you. Try to make sure these are not relatives or associates of the contractor.

Contractors with nothing to hide will not be offended with these inquiries.

Contact your local office of the Better Business Bureau (BBB). They keep records of complaints lodged against contractors in their sector and can tell you if any have been placed against the firms you name.

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Be Aware Of Contractors Who:
 
  • Quote prices before seeing the job.
  • Knock on the door because they happen to be in your area doing some other work and can give you a "special price".
  • Offer discounts if they can, "use your home to advertise with".
  • Demand unusually large deposits "to buy materials". Most reputable contractors maintain charge accounts with their suppliers.
  • Will not supply you with a detailed written contract specifying what they say and what they will do.
  • Have an address that is a post office box, a telephone number, or answering service address.

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Getting Bids


As we first mentioned, to make sure you're getting a fair price, get two or three bids on any home renovations projects - even small ones.

Do not sign or pay anything on the contractor's first visit.

With simple jobs like painting, the contractor should be able to provide you with a written quotation on the spot, detailing what is to be done and the materials to be used. With larger jobs like remodeling, additions, etc., they should bring samples, literature illustrating the range of materials and products that can be used and even photos of previous work they have done.

Once you have settled on your specifics, they should return with a plan or drawings (when applicable) and a written estimate detailing the work to be done, pricing, start and finish dates and terms of payment. Regarding the start date, ensure it's realistic and take into consideration jobs they already have on hand.

When you compare bids, make sure they cover the same work and materials, or that you have made allowances for any differences.

The lowest price is not always the best price. Sometimes the lowest price is indicative of an error the contractor has made or inexperience with this type of work to properly estimate it. If the contractor finds out he's going to lose money on the work, he could look for ways to cut costs, add unjustified extras to the bill or even abandon the job unfinished. Either way, it's trouble.

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The Contract & The Contractor


A piece of paper describing work to be done and giving a price for doing it becomes a legal document and binding on both parties once they have signed it. This piece of paper is usually referred to as, a "quote", an "offer", a "tender", an "estimate", a "bid" or a "contract".

The best advice we can give concerning the contract is, don't sign anything you have not carefully read, understood and are fully satisfied it describes exactly what you want and it contains everything you have been promised. If it does not - insist that it be written in and initialed. The contractor is not bound to assurances that are not in writing.

If the contract details something you are not sure of, ask for an explanation. If you're still in doubt, take it to a lawyer.

The Contract Should Include:

  • Names and addresses of the buyer and seller (yourself and the contractor). Ensure that the firm you have been dealing with is the one named in the contract, and that it clearly shows the firm's full name, address, telephone number and the name of it's official representative.
  • A detailed description, (with plans or drawings when applicable) of the work to be done and the materials to be used, including all the work that is being subcontracted (e.g. plumbing, wiring, etc.). Clear and concise job specifications will help avoid problems and misunderstandings that may arise.
  • Verbal assurances (as mentioned) are unacceptable - get it in writing.
  • All required building permits will be obtained by the contractor and that all work will be done according to local building codes.
  • The contractor will be responsible for removing all debris as soon as construction is completed.
  • A statement of all warranties, explaining exactly what is covered and for how long.
  • A statement of the contractor's public liability and property damage insurance.
  • Firm starting and completion dates.
  • Price and terms of payment.

Contract Forms

Although there are printed contract forms, there is no such thing as a "standard contract". Each is an individual document covering a specific situation. Any blank spaces should be filled in with N/A (not applicable) or NIL (nothing). Strike out anything you don't agree with or ask that the contract be rewritten.

In the case of a contingency clause allowing an additional charge in case of unexpected problems, such as running into solid rock when excavating a basement, be advised that this is perfectly legitimate and a better alternative to having them quote a higher price in order to cover themselves for such possibilities.

Small jobs, such as painting don't require a "contract" as detailed above. However, no job should be initiated without at least a written statement of the work to be done, the materials to be used, the warranties given, the cost and the start and the finish dates.

Occasionally, due to materials no longer being available or the homeowner wanting something different, etc. there are changes. For the protection of both parties, changes should never be made without the written approval of the homeowner and a signed statement from the contractor giving the extra charges (or rebate).

In the event renovations are being financed by a loan, check to see if the loan authority must approve the change. Be sure you know where the extra money is coming from and how it will be paid.

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Paying For The Work & Holdbacks


Down payments are seldom required on routine home improvements and repairs; even major projects are often initiated without a cash advance. If a down payment is required, it should not exceed 10% of the contract price unless special appliances, materials or custom cabinetwork must be ordered by the contractor. In this case it may be advisable to make your cheques payable jointly to the contractor and supplier.

Remember that cheques are safer than carrying cash and also provide a record of payment. If you are paying cash, get a signed receipt from the contractor upon payment.

Most jobs only take a few days to complete, so usually a one-time payment is sufficient. With larger jobs however, interim payments are common - but only for the work completed and never for the full amount. Some money should always be held in reserve to ensure the job's completion to your satisfaction. Avoid "progression" clauses that require payments at a specific time, regardless of the amount of work that has been done.

Another reason for withholding some of the money on all payments is to protect yourself against liens that can be placed on your property by suppliers or workers who were not paid by the contractor. A lien holds your property as security for the contractor's debts, even if you paid them in full.

All provinces except Quebec have lien laws that limit your liability to a certain percentage of the contract price. The proper procedure is to withhold this amount from all payments for the time allowed to creditors to register a lien on your property (usually between 30 and 60 days after the contract work is completed).

Before paying the holdback, (when the time period has elapsed) to ensure no liens have been placed on your property, you or your lawyer can check with the land registry or land titles office directly. In the case of a lien being applied, make no more payments until you receive notice that it has been discharged.

As the liens legislation differs from province to province in Canada, you should contact your lawyer to verify the rules and conditions of liens in your jurisdiction.

Do not forward the final payment or sign a certificate of completion or any other document that releases the contractor from further responsibility until everything you were promised has been done. Do not accept an assurance they will be back, "in a few days to finish everything off". Instead tell them their cheque will be ready then too.

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How To Deal With Problems


If a disagreement arises between you and your contractor, rule number one is, "be reasonable". Both parties should go over the contract calmly and listen to what the other has to say. If you are still dissatisfied, seek another opinion from a knowledgeable friend, etc. and if serious enough - your lawyer.

Poor workmanship, delays and misunderstandings about the scope of the work are the most common problems. Some contractors try to keep several jobs on the go at the same time, going back and forth between them, with days and even weeks between visits. A registered letter threatening to cancel the contract and obtain a refund of the down payment (permitted by law in some provinces) may get some action, particularly if it mentions sending a copy of the note to the consumer protection department of your local government, or to the contractor's bonding company.

To Avoid Problems:

  • Take care in selecting a contractor. Most people will go to 6 different shoe stores for a new pair of shoes, but will often hire the first contractor to do thousands of dollars of work on their home because of the way the contractor looked or spoke.
  • Ensure the contractor is properly licensed and carries the proper (active) insurance.
  • Ensure your contract contains the elements detailed in the section The Contract & The Contractor.

Poor workmanship and poor business practices can be reported to the government department from which the contractor obtained their business license. This office will take action as deemed necessary.

If you think some of the work may not be up to local or CMHC standards, report it in writing to the appropriate inspection department. If it does not meet the code requirements, the contractor will have to make the corrections at their own expense.

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