Negotiating The Fine Print
It is an often-overlooked fact, but the foundation of a profitable landscaping project is often laid figuratively before the first plant goes in the ground—in the contract. Lisa M. Wampler, a partner at the law firm Cohen Seglias, details four critical contract clauses to help form the bedrock of a commercially beneficial and secure project from the outset.
Clearly defining the scope of work
A scope of work clause defines actions, responsibilities and timelines. However, the risk of a broadly written scope is significant, warns Wampler. Clauses that simply state the contractor will provide “all labor, material, equipment necessary to complete landscaping per the plans and specs” can create liability for items explicitly excluded in the original quote. As a result, the contract’s scope of work must be precise. It should actively incorporate all clarifications and exclusions from the proposal. Wampler offers a common landscaping example: “It could be not providing irrigation. And therefore, if a business is providing plants, etc., its warranty is only going to cover those plants, if properly maintained and irrigated.” Explicitly stating such conditions in the contract’s defined scope, she adds, protects the contractor from assuming responsibility for elements outside their control or agreed-upon.
Managing price escalation
With fluctuating costs for materials, fuel and even plants due to factors like drought, tariffs and inflation, a static contractual price clause can erode margins. Wampler notes the current widespread trend of fixed-price contracts but advocates for a balanced escalation clause. Her firm drafts provisions where “significant” price increases—often defined as 5% to 15% over a project’s lifetime—triggers a change order. “It is not advisable that the client takes on 100% of that price increase, the contractor taking on, say, the first 5% increase,” she says, creating a shared, more negotiable risk model.
Negotiating a fair termination for convenience clause
A one-sided termination clause can leave contractors vulnerable. Wampler recommends striving for mutuality, such as securing a right to terminate if a project is suspended for an extended period. More crucially, she advises negotiating for fair compensation, including a termination fee. “Adding a termination fee kind of gives some teeth,” she says, discouraging owners from switching to a cheaper provider mid-project. For instance, structured on a sliding scale, this fee—a percentage of unperformed work— diminishes as the project progresses, acknowledging that the contractor has had more time to earn their profit.
Strategically limiting liability
Finally, Wampler outlines three key liability protections. First, explicitly exclude implied warranties, especially for architect-specified plants. “You shouldn’t be responsible for a tree unsuitable for its zone,” she states. Second, limit indemnity clauses to “insurable risk,” such as personal injury from your negligence. Third, cap total liability. A strong clause, she advises, “can anchor exposure to the contract’s value,” preventing damages from exceeding the price paid.
