Knowing Your Rights When Signing or Cancelling a Contract

When you decide to hire a professional to help you with your home improvement or renovation project, it is standard protocol for a contract to be drawn up, which outlines the agreement of work or services to be provided. You should always read over the terms and ask questions about the scope of work before making any commitments, or putting any money down. With any project, there may be instances where the nature of the work may change, or maybe you’ll run into a hiccup in your plans. Read on to learn more about protecting yourself, your property, and your finances before you sign on the dotted line, or even cancel a contract.The Purpose of a ContractA contract is a document that outlines the terms and agreements of a particular project or service, and once signed, becomes legally binding. According to various consumer protection acts (CPAs) in different provinces throughout Canada, any business that charges you more than $50 must provide you with a written contract. This amount may vary depending on the province, but it’s best practice to have an agreement in writing, as this is your best way of protecting yourself if something goes wrong, or is challenged. It is tough to provide proof of a verbal agreement, so get everything on paper.Contracts include the scope of work, the materials required, start and end dates for the project, and most importantly, the terms of payment. They also outline which party is responsible for certain services, and who is liable if something does not go according to plan. Everything should be discussed beforehand with the company or individual you are doing business with and should be documented. Essentially, “what you read is what you get,” and there should be no hidden costs or surprises. If the language is vague, ask for clarification and re-word the contract, so everyone is on the same page. Consider having a lawyer look over the contract before signing, for extra protection.Do Your Homework: Background ChecksYou might not think this has anything to do with signing a contract, but before you enter into an agreement with someone, you’ll want to know that they are reliable and reputable. It may be tempting to hire your brother-in-law because he’ll give you a fantastic deal on your kitchen reno, but he may not have the right qualifications or proper insurance. Always do extensive background research to make sure the business is legitimate, as this will save you time and money later on. One easy way to do this is by looking for their HomeStars Verified badge, which indicates that they’ve been screened for important things like criminal background, credit and professional licensing.Ask people who have worked with the companies you are considering about their experiences and read their reviews: did they do an amazing job, or should you avoid them because they never finished the work? Look into whether or not there have been any charges or complaints laid against them, check if the company has the proper credentials and licences, and that employees are covered by the Work Safety Insurance Board (WSIB). Tip: it’s a good idea to call your own insurance provider to make sure you won’t be liable if any accidental injuries occur on your property — you don’t want to get stuck paying for any medical bills or risk a lawsuit.Request an EstimateAgain, before you commit to someone on paper, shop around. Compare prices by asking for estimates from a few different companies to keep your options open. A legitimate contractor will do a site visit in-person, in order to provide an accurate estimate for the amount of work, materials required, whether or not something will need to be sub-contracted out, and time it will take to finish the job. Never accept offers from door-to-door salespeople on the spot, and don’t be coerced into hiring someone over the phone without them coming in to do a proper assessment.When you are ready to work with the right professional, request for the estimate to be included in the contract. This will ensure that the final price will not exceed more than 10 percent above the amount you were originally quoted. If there is a change in price, you and your contractor will need to agree on a new amount, and draw up a new estimate/contract for you to sign.Cancelling a ContractThere are many reasons you might need to cancel a contract: perhaps the work was never started, or you were charged unfairly for services, or maybe the company misrepresented itself (committed fraud, which is illegal). Cancelling a contract is well within your rights as a consumer, and companies should indicate somewhere in the agreement what that entails.In general, a clear start and end date for your renovation project should always be listed in your contract. If no work has started within 30 days of when it was promised, you reserve the right to cancel without losing any money. If a company has not indicated a start date of your contract, you also have the right to cancel within 30 days of signing. When a “cooling-off period” is indicated in your contract, that means you can cancel the job without giving a reason within 10 days of receiving the written contract, provided you send a letter (date it, and keep a copy of it) or email to the business indicating you wish to cancel.Most businesses have 15 days to refund your money once you back out. If a company refuses to do so (within the specified time), you can launch a formal complaint, or seek legal advice. If the reason you are cancelling a contract is because of unfair business practices, or you find out they have committed fraud, you should seek legal counsel to understand how to best protect yourself. No matter what document you sign, at the end of the day, you are entitled to legal help even if the contract states otherwise.One last piece of advice: never pay the full amount up-front. It’s recommended to pay an initial 10 percent at the start, but wait until the work is completed before paying the rest. This helps protect your money and ensures the contractor will stick around and finish the job. It bears repeating to always do your research, read the fine print, and ask questions to make sure you and your contractor have a clear understanding of the terms of the agreement.