Which document is crucial for both contractors and clients to protect their interests?

The contract is a fundamental document in the relationship between contractors and clients as it serves multiple essential purposes. It clearly outlines the rights, responsibilities, and obligations of both parties, ensuring that everyone is on the same page regarding the project's scope, timeline, payment terms, and deliverables. This clarity helps prevent misunderstandings and disputes, which can arise if expectations are not well-defined.

Moreover, a contract provides legal protection. In case either party fails to uphold their side of the agreement, the contract serves as a legally binding reference that can be enforced in court if necessary. It establishes the framework for how issues, changes, or conflicts will be handled throughout the project's duration.

While invoices, proposals, and receipts play important roles in the transaction process—such as outlining costs, initial project ideas, and verifying payments—they do not provide the comprehensive legal coverage and detailed agreement that a written contract does. Thus, the contract is the most crucial document for safeguarding interests in any home improvement project.