[jshilan]

Here in NJ any work that has a value of $250 or more must have a signed contract with a customer before you provide any service. If you do not have a signed contract (and this goes for change orders too) and the client disputes your agreement you can be sued for consumer fraud (which has a fine and possible imprisonment) and they can collect triple damages (three times the value of the contract). I'm sure court costs and attorneys fees would be added to that as well.

Contracts are for your protection as much as it is for the client. If there is a disagreement, the only thing that matters (legally) is what is in the contract and what was signed for. Anything that is verbal has no value or clout.

Get everything signed before and during the project this way there is little room for "favors" or miscommunication. Let clients decide if they want to pay for extras before you do them. Minimally get a change order that describes any additional work and list it as T&M and have them sign that.

I know NJ is crazy when it comes to lawsuits (that's why our insurance is so high) but it doesn't mean you should leave the door open for potential problems.

Presenting and signing a contract is not about trust, it is about business. Handshakes were fine 100 years ago. Today a handshake is only as good as the contract and deposit that goes with it.