I don't provide legal advice, but I can offer a remodeler's perspective regarding client down payments. Depending on the scope of work, a remodeler may need to make down payments to suppliers. My cabinetmaker and my stone supplier, for example, require down payments to cover their cost of materials. I think that's perfectly reasonable. If a customer's deposit doesn't cover the amounts required, the remodeler is at risk for the difference-- before they even set foot on the client's property.

For a small job scope and short duration project, the amounts requested by your remodeler would be typical in our market.

Many require 50/40/10. So you are more protected than typical.

It's interesting that much online advice suggests asking for more than 10%–roughly 33% is a red flag. We were just burned on a 50% down payment and the sting is still there, so did some looking around. This is in NY state where licenses are few because licenses aren't required, but they are bonded and insured.

We're supplying everything except for some building materials and it's mostly on-site because these guys are replacing a previous contractor whose work ended up so bad we had to pay to remove it. It's a small galley kitchen with a small attached hall and has been partially renovated already. I can't imagine a huge outlay. We've already paid for the cabinets, backsplash materials, etc, and the flooring is brand new. Maybe it's just the way they usually operate.

Hmmm. Here's a half-baked legal opinion, from someone who learned contract law many years ago and doesn't practice in that area. "Hold harmless" and "half-accountable" seem like contradictory terms, to the point this is either completely meaningless or creating some bizarre legal scenario that no one intended. Someone at the contractor's office downloaded an online contract and then messed around with it until it made no sense. I bet it originally read "not be held accountable for."

Ask your contractor what they think this phrase means. Then get that written out in plain English, or (best) get them to have an attorney draft it out for them. You absolutely want a hold harmless agreement. This isn't it.

(Disclaimer: general legal opinion, not specific advice that you should act on without consulting a local attorney.)

Agree that it is probably meant to read ‘not be held accountable for’ not half accountable for. In CA contractors can’t require more than $1000 deposit. Unless they are special ordering stuff that sounds like an awful lot to put down upfront. I wouldn’t work with a contractor who wasn’t sufficiently well capitalized as to not need the interim payments to be in excess of the value of the work done. Pay as you go but don’t ever get ahead of the value of work done.

Thanks for all the input. We also had a feeling it might be copied-and-pasted. We'll definitely clarify that.

We were thinking of asking about 10% down / +40% halfway to bring to 50% / remaining 50% after punch list. They do know we just got burned. They are also squeezing us in and are supposed to start next Wednesday—we got the contract this morning. Does this seem reasonable?

"I've checked these guys out and they've pulled lots of permits for pretty big jobs, have good reviews, a large presence on Instagram where you can see the passion they have for the craft, showed up in a very nice, neat truck with branding, and I couldn't find any BBB complaints, negative reviews, or court appearances."

I don't know what the market is like in your area, Kevin, but there's a good chance your remodeler is busy on bigger, more profitable projects than yours and is doing you a favor. In my experience, it's painful picking up where somebody else left off and there's more risk to the remodeler than there is on a typical project. No offense intended, but if you're worried about your remodeler, keep in mind they only know your side of the story about why the previous contractor is no longer on the job. If you come off as a difficult client, you need to be prepared for them to pass on your project.

The payment terms seem reasonable and pretty typical to me for a small, short job. Asking to be excused from liability for negligence would be a hard no-go. Negligence is already a pretty high legal barrier to prove. If they burn your house down do you really want no recourse? (not that your insurance company wouldn't go after theirs, probably successfuly, anyway)

I would resist signing a negligence waiver with a contractor. The entire reason you are using a contractor is their knowledge in remodeling.

I am also unsure whether the waiver would hold up in court as contractors are not generally arm's length relationships. They have a duty of due care and in certain cost plus arrangements a fiduciary responsibility.

It's not a negligence waiver. It's a hold harmless agreement that someone accidentally mangled. Written correctly, it should protect the homeowner from the contractor's mistakes or negligence.

Reading again, found another typo. "... and claims or damages" should be "any claims or damages." If OP points out the errors politely, I'm sure the contractor will fix this immediately.

I understand that is WAS a hold harmless agreement, but it has now been modified by the contractor in what seems a poor attempt to share the costs of negligence with the homeowner. This doesn't seem to be a typo, I suspect it is a poor attempt at a partial waiver.

I understand that this is mangled and likely unenforceable, but the intent matters. If your contractor believes you have a responsibility to pay half, you have already lost the battle.

Well if the contractor intends bry911's meaning, that is definitely a huge red flag and reason to walk away immediately. Hopefully this is just an accident they fix when OP flags it.

I'm glad I checked in here... I did notice the and/any wording and was going to include this in my reply:

"I had a chance to take a look at the contract this morning and am curious about the following paragraph:

"The Contractor agrees that the Owner shall now be half accountable for, and the Contractor agrees to hold them harmless against, and claims or damages (including incidental cost associated therewith such as attorney fees) resulting from the bodily injury or death and damage or destruction to tangible property, caused by the negligent acts or omissions of the Contractor in the performance of the work by the Contractor."

I'm thinking that this might be a typo/auto-correct issue and I'd feel more comfortable if it read something like:

"The Contractor agrees that the Owner shall not be held accountable for, and the Contractor agrees to hold them harmless against, any claims or damages (including incidental cost associated therewith such as attorney fees) resulting from the bodily injury or death and damage or destruction to tangible property, caused by the negligent acts or omissions of the Contractor in the performance of the work by the Contractor."

I guess I am much less trusting.

"The Contractor agrees that the Owner shall not be held accountable for, and the Contractor agrees to hold them harmless against, any"

I doubt that was the original wording, why agree not to hold the owner accountable in the first part and then insert bracketed commas to agree to hold them harmless? That is just a repeat of the same thing. I suspect the original contract had languagesimilar to this: the contractor agrees to be wholly responsible for, and the owner held harmless against, any...

I suspect the contractor then changed it in an attempt to modify his liability and share it with the homeowner.

I decided to just ask for clarification on that paragraph for now instead of suggesting any edits and said I would run it by my insurance agent tomorrow.

That's a smart approach. Non-combative and the quickest way to find out what they really intend, which is helpful info for you whatever you learn.

FWIW I agree that your corrected version is correct and since your GC is legally illiterate and probably most of the clients don't read the contract, it remained.

I would make sure that he has workers' comp policy in place and liability insurance. When I did my remodel, my GC supplied me with proof of both. Otherwise you could be held liable for any injuries to workers - or at least sued for that. Any competent GC would have WC and an insurance policy of at least a million dollars.

FWIW, in California a GC can only ask for 10% of the contract on signature. After that payments are done in steps and I was asked for 50% when they started at various points and the remainder when they were finished and 10% was withheld until final to ensure that everything was "done" as there are generally going to be glitches which aren't discovered until you do your final walk through.

I am a lawyer and I did NOT negotiate a contract with my GC the way I would for a contract with a sophisticated other party. I made sure that I was protected on the major terms like insurance and liabilty and payment structuring but the reality was that I was depending on the recommendations regarding the GC in terms of his reliablity, honesty and competence because having to sue on a contract with a GC for any reason is a disastrous nightmare for a homeowner. The only thing that I laugh about is that ther is a clause that the remodel will take 8 to 12 weeks - it is now over 3 years since I moved back and there are still a few odd things like a wonky floor board that he needs to fix. Of course it speaks volumes for the good relationship we have that he actually comes back even though I don't owe him money at this point.

Thanks Helen! They have the proper insurance and are offering a certificate, so that is a positive.

One thing that we just thought of was that they may want protection from being blamed for things that may go wrong because they're going to be working on top of a bad contractor's preliminary work. If that's the case, I totally get it and would want to add some language that protects them. Though it seems difficult to define.

Probably. Do I smell.......spam? :-)

Thank you sushi, for doing your best to keep us spam-free. I know it's a thankless job, and I suspect we would be over-run were it not for your efforts.