Construction Contracts Agreements You Need + Template


No matter what type of construction project you’re working on, it’s essential to have a construction contract agreement in place. This document outlines the expectations and responsibilities of the contractor and the client. Without a construction contract agreement, misunderstandings and disagreements can quickly become costly and time-consuming. 

This article will discuss the different types of construction contract agreements and clauses you need and provide a template for these clauses.


Necessary Construction Contract Agreements and Clauses

Your construction contracts should include the following agreements and clauses as relevant. 

Indemnification Clause

The indemnification clause is one of the most critical clauses in a construction contract agreement. This clause protects the contractor from any claims or damages arising from the project. The indemnification clause should list the specific types of damages that are covered, and who is responsible for each type of damage.

Scope of Work Agreement

A scope of work agreement outlines the specific tasks the contractor will be responsible for. This agreement should be very detailed and specific to avoid any misunderstandings. The scope of work agreement should also include a timeline for each task and a budget for the entire project.

Insurance Clause

The insurance clause in a construction contract agreement protects both the contractor and the client from any damages that may occur during the construction process. This clause should list out the specific types of insurance that are required and who is responsible for each type.

Arbitration Clause

An arbitration clause is a clause in a construction contract agreement that stipulates that any disputes that may arise between the contractor and the client will be resolved through arbitration. This clause is essential to have in place to avoid costly and time-consuming legal disputes.

Warranty Clause

A warranty clause is a clause in a construction contract agreement that guarantees the quality of the work performed. This clause protects the client from any damages or defects after the construction project is completed.

Conditional Payment Agreement

A conditional payment agreement is a clause in a construction contract agreement that stipulates that the client will only pay for the work performed. This clause protects the contractor from any non-payment or late payments.


Construction Contract Agreements Templates

Now that you know the different construction contract agreements and clauses, you can start putting together your agreement. Below is a template for a construction contract agreement that you can use for your projects.

Construction Contract Agreement Template

This construction contract agreement (“Agreement”) is made and entered into on DATE by and between CLIENT and CONTRACTOR.

For the performance of services pursuant to this Agreement, the parties agree as follows:

  1. Services. CLIENT hereby retains CONTRACTOR to provide construction services (the “Services”) at the Project site (the “Project”). The Services shall be performed in a professional and workmanlike manner in accordance with industry standards.
  2. Term. The term of this Agreement shall begin on DATE and continue until the completion of the Services or as otherwise mutually agreed upon by the parties in writing.
  3. Compensation. In consideration for the performance of the Services, CLIENT shall pay to CONTRACTOR the sum of COMPENSATION payable in installments as set forth in the project schedule attached hereto as Exhibit A. All invoices for Services rendered shall be due and payable within TERMS days of receipt.
  4. Expenses. CLIENT shall reimburse CONTRACTOR for all reasonable and necessary expenses incurred by CONTRACTOR in connection with the performance of the Services, including but not limited to travel, lodging, and per diem expenses.
  5. Insurance. During the term of this Agreement, CONTRACTOR shall maintain commercial general liability insurance and workers’ compensation insurance in an amount not less than AMOUNT, with POLICY NUMBER as the certificate holder. A copy of CONTRACTOR’s current insurance policy shall be provided to CLIENT prior to the commencement of any work under this Agreement.
  6. Indemnification. CLIENT shall indemnify, defend, and hold CONTRACTOR and its employees, officers, directors, shareholders, agents, and affiliates harmless from and against any and all claims, liabilities, damages, losses, or expenses arising out of or in connection with the Services or this Agreement.
  7. Arbitration. Any dispute arising out of or relating to this Agreement or the performance of the Services shall be resolved by binding arbitration in accordance with the rules of the American Arbitration Association. The arbitrator’s award shall be final and binding on the parties and may be entered as a judgment in any court of competent jurisdiction.
  8. Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of STATE.
  9. Entire Agreement. This Agreement constitutes the entire agreement between the parties with respect to the subject matter herein and supersedes all prior and contemporaneous agreements, proposals, representations, and understandings. This Agreement may only be modified in writing signed by both parties.
  10. Waiver. The failure of either party to enforce any provision of this Agreement shall not constitute a waiver of such provision.
  11. Severability. If any provision of this Agreement is held to be invalid or unenforceable, such provision shall be construed in a manner consistent with applicable law to reflect, as nearly as possible, the original intentions of the parties, and the remaining provisions shall remain in full force and effect.
  12. Assignment. This Agreement may not be assigned by either party without the prior written consent of the other party, but may be assigned without such consent by either party in connection with a merger, acquisition, or sale of all or substantially all of such party’s assets. Any attempted assignment in violation of this section shall be void.
  13. Construction. The headings contained herein are for convenience only and shall have no legal meaning or significance.
  14. Counterparts. This Agreement may be executed in counterparts, each of which shall constitute an original and all of which together shall constitute one agreement.
  15. Force Majeure. Neither party will be liable to the other for any delay or failure to perform its obligations under this Agreement (except for a failure to pay fees) if such delay or failure is caused by events beyond such party’s reasonable control, including but not limited to acts of God, fires, floods, earthquakes, strikes, other labor disputes, riots, wars, terrorist attacks, embargoes, power or internet service failures.



DATE 1: ____________________________________________________________

DATE 2: ____________________________________________________________

DATE 3: ____________________________________________________________

DATE 4: ____________________________________________________________



CLIENT: ____________________________________________________________

CONTRACTOR: ____________________________________________________________`;

Create Your Construction Contracts

A construction contract agreement that will help protect you and your business. If you have any questions about these clauses or what should be included in your construction contract agreement, speak with an attorney familiar with construction law.