Here is what I did. First, I bought a package of ready made proposal forms from a large office supply store, like Staples or Office Max. I made some minor modifications to it, then went to see a printer. The printer was able to do a "shoot" of it, then add in the modifications I made. They are two part, carbonless, and look pretty good. Most importantly, things are spelled out exactly what work is to take place. Total cost....about 50 bucks.
In my opinion, and any lawyer you talk to, it is absolutely necessary to have a written contract. All the contractors out here who work without one are exposing themselves to unneeded risk, and are only fooling themselves if they think a handshake is good enough. Sure, verbal agreements can stand up in court, but, what if the judge sides with the other party? What if the other party is a good liar, and convinces the judge that he/she is right? Too many times courts will side with what is perceived as "the little guy", and make businesses pay.
If you would like to see a copy of my proposal agreement, let me know, and I'll scan it in, and email it to you.
Tony