Contractor: A contractor is a person who contracts to make repairs upon, or improvements to, your home or property.
General Contractor: A general contractor is a professional builder or remodeler who takes charge of a construction job and coordinates the work of the subcontractors, suppliers, the designer or architect (if one is involved), local building inspectors and related government agencies.
Subcontracor: A subcontractor is a trades person hired by the general contractor to do one or more of the jobs needed. They are skilled in one or more areas and bring with them specific knowledge and expertise.
Licenses: Anyone who advertises for services done around the home must hold a valid city license. A police review is conducted before a license is issued. If a contractor takes deposits on work to be completed, and looks for work and discusses a contract away from his place of business, he must be bonded and he must hold a provincial license as well as a city license. Good contractors should be proud to show their licenses.
Building Permits: A permit must be obtained from the city before commencing certain work being done on your property. If the structure of your home, or any of its components, (wiring, plumbing,etc.) will be altered, you will be required to obtain a building permit. It is best to have your contractor obtain these permits. This should be clearly set out in your contract.
Worker’s Compensation: Contractors may pay into this insurance to cover themselves should they become injured on the job. It is not compulsory, so not all contractors will have it. If a contractor is injured on your property, the only way you could be sued, is if you are negligent. For example, a painter sets up his ladder on your freshly washed, wet floor, slips and falls and breaks his leg. If he does not have worker’s compensation, he could sue you. Most people are covered for liability under their home insurance policy. It is, however, a good idea to call your insurance agent to make sure you have the proper coverage before starting your renovation project!
Lien: A lien is a notice that someone is claiming a right to be paid out of the value of a particular piece of property. A lien can be placed on your property by suppliers or workers who are unpaid by the contractor. Liens hold your property as security for the contractor’s debts- even if you have paid the contractor in full! In other words, you could owe a supplier or subcontractor for payments or wages the contractor neglected to pay. You have final responsibility for seeing that all bills are paid to the proper people. For a large home improvement job that involves several subcontractors and a large financial commitment, you should protect yourself from liens against your home in the event that the contractor does not pay his suppliers or subcontractors. You can do this by adding a release-of-lien clause to the contract, or by placing your payments in an escrow account until the work is completed. You can check your title record at a registry office. (Call us for the Calgary office nearest you).
Bond: A bond is an insurance policy for which the contractor pays a premium. It guarantees that the contractor will meet his obligations in a satisfactory manner. Failure to do so should result in the payment of compensation by the bonding company. In Alberta, if a contractor accepts money before work is complete, and he/she looks for work and discusses a contract away from their normal place of business (for example, in your home), he/she must be licensed by Alberta Municipal Affairs, Housing and Consumer Affairs. He/she must also be bonded by a bonding company. Choosing a bonded contractor is more important when substantial, expensive jobs are to be done.