From a legal standpoint, there is only one name for an agreement to perform a service in exchange for compensation: "contract."
Such a contract can be as simple as: "In consideration for [contractor's name] chipping and mulching all dead organic material (approximately 50 cubic yards) from the property found on the lot located at [address], [property owner] agrees to pay [amount] -- payment to be made at the conclusion of the aforementioned work."
And, of course, the contract needs to be signed and dated by the contractor (and you).
That's all you need. Now, if the contractor is licensed by the Contractors State License Board (CSLB), then the contractor has certain legal obligations, among them, not to accept more than 10% deposit for the work, and to notify you that if you do not pay in accordance with the contract, the contractor can place a mechanics lien
on the property, and force the property's sale, in order to pay the bill.
There is also an issue that most property owners don't consider, which is that many unlicensed (and licensed) contractors use undocumented workers, or pay workers in cash, so as to avoid having to remit payroll taxes, or workers compensation insurance. And, if for some reason, a worker is injured on your property, then you will end up being sued by some enterprising lawyer who knows that California law makes such lawsuits a "slam dunk," if you take my meaning.
Consequently, the reason for the discrepancy in price may be due to the higher priced bids doing everything "by the book," while the low bidders plan to avoid every possible law, and hope that they don't get caught.
The only way to really protect yourself is to find a reputable landscape contractor. It will cost more, but you won't be at risk. You can also require that the contractor provide you with a certificate of workers compensation insurance sufficient to cover all of the employees on the worksite. Without that, you don't want to hire the contractor, because you're taking a pretty substantial risk.
Other than that, there's nothing particularly special about any of this. A professional contractor will have a professional looking contract with all of the related terms and conditions that I've discussed here.
Ultimately, the choice is yours. I wouldn't accept the lowest or the highest bid. But, whatever it is, I would want everything in writing, and everything that I've described above.
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