DPOR Requirements for Residential Construction Contracts
–By Les Brock–
Residential contracting is highly regulated in Virginia to ensure that consumers are protected when hiring contractors for home improvement projects. The Virginia Department of Professional and Occupational Regulation (DPOR) is responsible for licensing and regulating contractors in Virginia. DPOR has very specific requirements for what must be included in every residential contracting agreement, with few exceptions.
Unfortunately, many contractors operate like its the Wild West without signed, written contracts or even a clear oral agreement with the homeowner on all the particulars of the work. Even where the contractor does go through the trouble of preparing a written contract, the contract usually falls well short of what is required by DPOR, and there are usually numerous changes made during the project without written change orders. These contractors may fly under DPOR’s radar for a while, but when a project goes sideways (which is only a matter of time), technical violations in the construction contract can spell disaster for the contractor. It can lead to heavy fines, license suspension, or even license revocation.
Below, we will explore the items that must be included in residential contracting agreements in Virginia to comply with state regulations. To determine whether your contract is in compliance with state laws, it is highly recommended that you seek out the advice of a construction attorney familiar with Virginia’s contractor requirements.
- Scope of Work
The first item that must be included in a residential contracting agreement is a detailed description of the work that is specifically requested by the consumer. This description should be specific and detailed, including a list of the work that will be done and the materials to be used. This helps dispel later disagreements about what the contractor is responsible for providing.
2. Payment Terms
The payment terms for the project must be clearly stated in the contract. This includes the total cost of the project, the amount of any down payment, as well as a breakdown of the amounts and schedule for progress payments.
3. Project Timeline
A project timeline must be included in the contract, outlining the start date and the estimated completion date of the project.
4. Change Order Procedures
Change orders are amendments to the original contract that may be necessary during a project. The contract must state that any modification to the contract which changes the cost, materials, work to be performed, or estimated completion date must be in writing and signed by all parties.
The contract must include a “plain-language” exculpatory clause concerning events beyond the control of the contractor and a statement explaining that delays caused by such events do not constitute abandonment and are not included in calculating timeframes for payment or performance.
6. Cancellation Rights
The contract must disclose the cancellation rights of the parties. For residential construction contracts resulting from a door-to-door solicitation, the contract must contain a signed acknowledgment by the consumer that he has been provided with and read the DPOR Statement of Protection available through the Board for Contractors, and the Virginia Consumer Protection Act requires that the contract include a notice of cancellation informing the consumer of their right to cancel the contract within three days of signing.
7. License and Contact Information
The contract should include the contractor’s name, address, license number, class of license, and classifications or specialty services. This information is important to ensure that the contractor is properly licensed to perform the work proposed in the contract.
8. Compliance with Permits, Inspections and Zoning
The contract must include a statement of assurance that the contractor will comply with all local requirements for building permits, inspections, and zoning.
9. Recovery Fund
The contract must contain a statement notifying the consumer of the existence of the Virginia Contractor Transaction Recovery Fund with information on how to contact the board for claim information.
When entering into a residential contracting agreement in Virginia, it is imperative that the contract includes specific items to ensure compliance with state regulations. These include a detailed scope of work, payment terms, project timeline, change order procedures, delay disclosure, cancellation rights, contact and licensing information, compliance with permits and inspections, and information on the contractor recovery fund.
Including each of these items in the contract will help ensure that the contractor and homeowner are in agreement on the basic elements of any construction contract, and it will help ensure that the contractor complies with certain regulations by making the consumer aware of those requirements. The contractor’s failure to include each of these items in its residential contract is considered a “prohibited act” that can subject the contractor to fines, suspension, or even loss of its contractor’s license.
If you need a construction attorney to review your residential construction contract, call Merrick Brock at 804-500-9796.
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