This construction work authorization form authorizes a contractor to perform work on a
property owner's property, and authorizes the owner's insurance company to pay the
contractor for the work performed. This form contains standard terms used in this form,
however, additional terms may be added to suit the needs of the user. Use this form
when entering into an agreement to perform work on a property owner's property, or if
one is a property owner wanting to have a contractor perform work on one's property.
WORK AUTHORIZATION AGREEMENT
THIS WORK AUTHORIZATION AGREEMENT (the “Agreement”) made as of ___________
[Instruction: Insert Date], by and between ___________ [Instruction: Insert Name of
Construction Company], located at ___________ [Instruction: Insert Address]
(“Contractor”), ___________ [Instruction: Insert Name of Property Owner], located at
___________ [Instruction: Insert Address] (“Owner”).
WHEREAS, Owner owns and/or has a legally recognized interest in the real property located at
___________ [Instruction: Insert Address] (the “Property”);
WHEREAS, Owner insured the Property by purchasing policy number ___________
[Instruction: Insert Policy Number] (the “Policy”) from ___________ [Instruction: Insert
Insurance Company Name] (“Insurance Company”). A copy of the Policy is attached hereto as
Exhibit “A” hereof;
WHEREAS, on or around ___________ [Instruction: Insert Date], Owner filed claim
#___________ [Instruction: Insert Claim Number] (the “Claim”) with Insurance Company
regarding damage and/or loss to the Property. A copy of the Claim is attached hereto as Exhibit
“B” hereof”;
WHEREAS, pursuant to the terms of the Policy, Owner has the right to select a contractor to
perform the repairs to the property,
WHEREAS, Owner desires to engage Contractor to perform the repairs to the Property indicated
on the estimate, attached hereto as Exhibit “C”, and incorporated herein (the “Estimate”), and
pursuant to the terms and conditions contained herein, Contractor desires to accept said
engagement;
NOW, THEREFORE, in consideration of the mutual promises and covenants hereinafter set
forth, the parties agree as follows:
1. Authorization.
A. Owner hereby authorizes Contractor to perform the repair work needed as a result the
Claim for damages and/or loss which occurred at the Property, in conformity with the scope and
repair price outlined in the Estimate.
B. Owner further authorizes Insurance Company to release payment direct to Contractor for
the services performed on the Property in conjunction with Claim, in conformity with the scope
and repair price outlined in the Estimate. Should the Insurance Company require direct payment
to the Owner, Owner shall request that Contractor’s name be added to any check or draft sent to
Owner in payment of the Claim.
C. In addition to the liens otherwise available to Contractor under the laws of the State of
___________ [Instruction: Insert State] by virtue of the work performed hereunder, as security
for Contractor’s work, Contractor is hereby granted a lien on any settlement or recovery from
payment(s) due from any insurance company or mortgage company, including but not limited to
Insurance Company.
D. In the event that it becomes evident that additional repairs are required to be performed
on the Property that are not included in the Estimate, Contractor shall identify the additional
work (including the scope, the compensation required, and the anticipated completion date) in
writing and obtain approval from both Owner and Insurance Company. If such approval is not
obtained, no additional work will be authorized and payments for said work will not be
furnished.
E. Owner understands that Insurance Company may not cover all work performed
hereunder, and expressly agrees that Owner is responsible for all costs not covered by Insurance
Company.
2. Terms of Service. All terms and conditions of Contractor’s services, including anticipated
completion time, when payment is due for such services and the parties’ rights and remedies
shall be subject to the signed Estimate.
3. Miscellaneous.
A. Insurance. Contractor carries commercial general liability insurance written by
___________ [Instruction: Insert Insurance Company Name]. Owner may call ___________
[Instruction: Insert Insurance Company Name] at ___________ [Instruction: Insert Phone
Number] to check the Contractor’s insurance coverage. Contractor carries workers’
compensation insurance for all of Contractors employees.
B. Contractor’s License. [Comment and Instruction: This requirement is particular to
the laws of the State of California as it pertains to contractors. If your company is licensed
in another state you will want to determine if your state requires such a requirement and if
so, use the requirement required by the statute particular to the state your company is
licensed in. Or better yet, you should review whether a similar document for another state
is available for purchase on Docstoc, because it might have other or additional particular
provisions that are specific and applicable to the laws of that state.] All contractors,
including Contractor, are required by law to be licensed and regulated by the Contractors State
License Board of the State of California (the “Board”), which has jurisdiction to investigate
complaints against contractors. Contractor represents and warrants that it is fully licensed by the
Board, and further warrants that the company’s license is, and will remain, current and in good
standing. Any questions concerning a contractor may be referred to the Registrar of the Board
whose address is: Contractors State License Board of the State of California, 1020 N Street,
Sacramento, CA 95814.
C. Mechanics Lien Warning. [Comment and Instruction: This warning is particular to
the laws of the State of California as it pertains to contractors. If your company is licensed
in another state you will want to determine if your state requires such a warning and if so,
use the warning required by the statute particular to the state your company is licensed in.
Or better yet, you should review whether a similar document for another state is available
for purchase on Docstoc, because it might have other or additional particular provisions
that are specific and applicable to the laws of that state.] Anyone who helps improve your
property, but who is not paid, may record what is called a mechanics lien on your property. A
mechanics lien is a claim, like a mortgage or home equity loan, made against your property and
recorded with the county recorder. Even if you pay your contractor in full, unpaid
subcontractors, suppliers, and laborers who helped to improve your property may record
mechanics liens and sue you in court to foreclose the lien. If a court finds the lien is valid, you
could be forced to pay twice or have a court officer sell your home to pay the lien. Liens can also
affect your credit. To preserve their right to record a lien, each subcontractor and material
supplier must provide you with a document called a ‘Preliminary Notice.’ This notice is not a
lien. The purpose of the notice is to let you know that the person who sends you the notice has
the right to record a lien on your property if he or she is not paid. The Preliminary Notice can be
sent up to 20 days after the subcontractor starts work or the supplier provides material. This can
be a big problem if you pay your contractor before you have received the Preliminary Notices.
You will not get Preliminary Notices from your prime contractor or from laborers who work on
your project. The law assumes that you already know they are improving your property. You
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