Home improvement contracts in New Jersey are highly regulated, and these regulations are to protect homeowners when they hire contractors for home improvements. They cover general contractors hiring sub-contractors to perform work, landscaping services, clearing or restoring services, and anyone else doing home improvement or repairs for a homeowner.
A home improvement construction contract must outline each party’s obligations, rights, and remedies for a specific project. These are subject to certain requirements, including:
- In writing, for contracts in excess of $500, signed by both parties;
- Contractor’s registration number;
- A copy of the certificate of commercial general liability insurance;
- Total contract price, the description of the work and materials, the start and completion dates;
- Description of any mortgage or security interest in connection with financing the improvement;
- Any guarantee or warranty of the work or materials.
The contract must also have two Notices (Notice to Consumer and Contractor Registration Notice) informing the homeowner (1) of their 3-day right to cancel the contract and (2) of the registration act and the toll-free number of the NJ Division of Consumer Affairs.
If the contract provides for payments over a period of over 90 days, in addition to the other two Notices and requirements, it must include a Notice to Owner, a statement of worker’s compensation and public liability insurance coverage or identify if the contractor is qualified as a self-insurer. All Notices must be in 10pt bold-face type.
Finally, in addition to contractual protections, homeowners have rights under New Jersey law, the Consumer Fraud Act, which protects them from contractors engaging in unlawful practices. Those include misrepresenting products or materials to be used, beginning work before obtaining all the requisite construction permits, “bait and switch” tactics, and failing to begin work in a timely manner. Contractors – make sure that your contracts comply with the law – you’ll save yourselves a lot of time and money in the long run.
If you have a problem with a contractor, first try to resolve it directly – in writing. If the issue still can’t be fixed, a complaint can be filed with the NJ Division of Consumer Affairs which will then serve as a mediator in resolving the dispute, or you can call a lawyer.
Makayla Newman is a law clerk at Kates Nussman Ellis Farhi & Earle. She is a second-year law student at Rutgers Law School in Camden, NJ where she is an Associate Editor for the Women’s Rights Law Reporter.
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