1. Get it on paper - It doesn't have to look like F. Lee Bailey wrote the language in a contract. Just get it in plain language that both parties can understand, and number your paragraphs, so that in the off chance that the contract goes for 20 pages or more, you'll have reference points.
2. You can't be detailed enough - If you spell out the responsibilities of each party in clear but very focused detail, there'll be none of that, "Well, you didn't say I had to do all of that" B.S. that always seems to manifest when the time draws close to project completion.
3. Simplify the language - There is a thin line between being specific and detailed in each party's responsibilities and getting bogged down in murky language trying to spell out these duties. Keep the explanations conversational, as if you were speaking to someone about them. Sure, it's a contract, but it's still being read by other human beings.
4. Get the right signature - This should go without saying, but make sure the principle decision maker for each party adds their John Hancock to the contract. If it's an agreement between a contractor and a homeowner, those are the two that should sign, not the contractor's apprentice and the homeowner's wife. If it's a purchase contract for a property, the property owner and the buyer should ink the signatures. And each party will be clearly identified in the opening paragraph of the contract.
5. Identify the parties correctly - The last line of tip #4 is important enough to be its own tip. Make a point of clearly laying out the groups or individuals pertinent to the contract at hand. That is, identify each side of the thing, and then have a parenthetical following that identification that generalizes the party, like "(hereafter referred to as CUSTOMER), or (hereafter referred to as CONTRACTOR)." It'll save you a lot of confusion and printer ink.
6. Lay out the payment schedule - If you're buying or selling a house, the terms will be pretty cut and dry. This tip refers more to when you're contracting work, and a really good contractor won't need any draw, even for material costs. He or she will need payment, in full, after the final walkthrough, and you sign off on their work. But occasionally there'll be a contractor that needs a draw before project delivery, and if so, they should say so before signing into a contractual agreement. Then, you'll clearly lay out exactly what you'll pay them on that draw and which duties will have to be complete in order to remit that payment. And hold tight to it, through the seemingly identical sob stories and country songs some contractors will give you.
7. Agree on mediation - A contract is simply an official agreement, nothing more. And agreements often go wrong. Don't think that because everyone is all smiles when you first meet that it'll stay that way through the entire project period. There'll more than likely be at least one disagreement, and you need to highlight an agreeable way to settle such disputes. Arbitration or going to court are the two options, should it be a serious enough disagreement. Both are expensive and should be avoided at all costs.
8. Leave yourself a backdoor - A cancellation policy - a 30-day stipulation is good for independent contractor agreements as well as purchase and sale agreements - can be your golden parachute if you discover in your due diligence period that something is amiss and can't be remediated without terminating the contract altogether.
9. Pick a state law that will govern the contract - Should you need arbitration or judicial remediation of a contract, the state that you're doing business in will be the state whose laws govern the contract. But, if you're on a border between two states (Augusta, where Auben Homes is located, is just on the border of Georgia and South Carolina) clearly specifying a state will keep you from getting caught in a tug-of-war if the contractor is located in one state and the work is being performed in another state. The project location's state is the best way to go.
10. Keep it confident - If an IC (independent contractor) goes off the wire after a disagreement, a confidentiality agreement will be the only thing to keep him or her from sullying your good reputation all over town. Especially if you live in a town like Augusta, where word travels fast and everyone knows everyone. If you treat someone fairly and with respect while protecting your own assets, a contractor will have no reason to say anything bad about you or your company. But they do sometimes, anyway. Put some bite into this part of the contract, so that you will curb any sinister instincts on the other side.
The main ingredient to any enforceable agreement is that it is actually on paper. I've heard a story of a wedding prenuptual that was written on a napkin at the reception. Not sure if that actually held up in court or not, or if it even came to that. The point is that anything on paper is infinitely more enforceable than a verbal or handshake agreement. Then, you can tweak the print agreement to your specific needs with these 10 tips.
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