December 13, 2010
General Conditions of the Home Improvement Contract: Permits and Approvals
By Bob Incollingo
Interestingly, no law says that a home improvement contractor must request, or pull, a required construction permit, but he is legally barred by the Home Improvement Practices Regulations from beginning work without one.
Since the same regulations require that all terms of a contract over $500.00 be in writing, responsibility for obtaining and paying for permits should be fully considered and stated. Here is a specimen clause concerning permits and approvals:
|6. Permits and Approvals. The cost of construction permits is NOT included in the Contract Price. Owner shall separately advance all construction permit fees on demand so that timely application for permits may be made by the Contractor. Contractor may invoice Owner for reimbursement of additional costs incurred by the contractor to obtain the permit and to record any necessary documents, and the same shall be payable upon submission. Contractor is NOT responsible for obtaining or making application for any zoning, planning, or other governmental and private approvals necessary for the execution of the Work, nor for contributing time or effort to the application for such approvals in the absence of a signed written Change Order providing for appropriate payment. Owner shall separately and diligently prosecute all such applications at Owner’s sole expense. Owner’s failure to procure all required land use permits and approvals within thirty (30) days of the latest date of execution of this contract by all parties shall constitute a material breach under these Contract Documents. As a pre-condition to Contractor’s obligations under this contract, Owner shall furnish upon demand all documents and information requested by Contractor as necessary or desirable for Contractor to confirm or obtain required permits and licenses.|
At the end of the job, keep this in mind: on the final invoice to the consumer, a contractor is legally required to list the cost of all permits required to complete a New Jersey home improvement project (other than new construction), along with any associated administrative or processing fees charged. The law limits associated charges to the actual cost to the contractor to obtain the permit and to record any necessary documents. (See, “Final Invoice Disclosure and Limit on Charges for Pulling a Permit,” infra, November 1, 2007).