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#1 |
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Registered User
Trade: Homeowner
Join Date: Aug 2006
Posts: 3
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My Gut Churning Situation
Your professional input, suggestions & advice are desired on my slightly long post. I was going to post this in the DIY Forum but thought you all would have a better perspective.
My wife & I are currently having an custom ICF (insulated concrete form) house built for us in Wisconsin. We have a standard contract, signed, fixed bid, with specified allowances for certain items. We recently received two invoices from the builder. The first invoice is for two items. The first is for 30 pieces of #4 rebar that was used in the footings ($300). The second is a charge for a longer concrete conveyer due to site inaccessibility ($1700). My question on the rebar is: shouldn’t that have been included in the base bid for the house? Seems odd to get a separate invoice for the rebar for the footings after the fact. The question on the conveyer: The building site was a know condition prior to the bid. The GC knew there was a limited approach to the site, and had had several opportunities to observe and walk the site. Based on those walk throughs and observations the builder requested that a dozen or so small trees (2-4 inch dia.) be cleared for better access for the conveyer. Permission was granted to clear the trees for conveyer access. Then we get the invoice saying they want an additional $1700 for using a longer conveyer even after removing the trees. Am I right in feeling that I should not be on the hook for this expense? What about being informed (change order) of a possible expense prior to getting an invoice in the mail? We were not consulted and did not have the opportunity to even provide alternate solutions such as contemplating a different approach Before receiving the above invoice I had been worried about possible expenses with the excavation and I sat down with the GC to ask about costs. The GC explained to me that my concern was unfounded and that we just had to worry about the allowances since this was a Fixed Bid contract and not a Cost-Plus contract. I was relieved to hear this because there was no separate allowance listed in our contract for Excavation and the GC acknowledged that in the discussion. Then we received the next invoice. This itemized the hourly/equipment excavation expenses from the sub-contractor. 3 days of excavation and 2 days of backfilling totaling just over $14,000. The GC now claims that there IS an Excavation amount in the contract and it is only for $2000. This allowance does not appear in any of the documents we have copies of. So this new invoice lists all the excavation/backfilling charges and then begins subtracting out the following allowances. The mystery $2000 for excavation, $1500 for backfilling, $1000 for 100ft of gravel driveway and then goes to on to add on and use the $1500 allowance for Gravel fill in the garage (no gravel has been placed in the garage so I guess we will have to pay for that later if it is used up now) and a left over $2000 allowance for winter costs. This then leaves us with an outstanding balance of about $5,500 that the GC is saying that we have to pay him. If we had a Cost-Plus contract then receiving these itemized invoices is what I would expect. But with a Fixed-Bid then these excavation expenses are between the GC and the Sub. Am I off base here? Also shouldn’t we be notified through a change order regarding extra expenses so we can discuss with the GC about options before work is undertaken? Did our GC underbid and now want to stick us with the expense of his mistake?. We have a meeting scheduled with the GC this Thursday to have a discussion regarding these invoices and hear what they have to say about them. I would really appreciate hearing your thoughts, comments and questions as trade professionals about this and similar situations you have encountered how they were handled and what the end outcome was. What would you do if this was happening to you? Thanks. |
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#2 | |
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unlicensed hack
Trade: wood butcher
Join Date: Mar 2006
Location: North Pole
Posts: 1,087
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Re: My Gut Churning SituationQuote:
Is there a payment schedule attached to the contract? If so, have you already made the first draw? I would have a lawyer look at the wording in the contract that YOU signed and have in your possesion. Unless, somewhere along the line of signing contracts, you signed something the GC snuck in on you. Some of these guys can be real sneaky.
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The views expressed in this post are merely opinions of named poster and in no way shall be deemed meaningful by members of the herd. By no means does anything posted by named poster mean a damn thing for anyone else partaking in this thread. |
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#3 |
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Pro
Trade: General Contractor
Join Date: Mar 2006
Location: Hennessey, Oklahoma
Posts: 6,057
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Re: My Gut Churning Situation
I hate to say this, but lawyer up! Before you have any more work done, or any further payments, you need a meeting with the GC and figure out what is going on. Record every conversation and document everything. Keep your phone bills for proof of calls made and recieved.
I will be the first to say that, and maj will agree, as GC's we can't see everthing coming. Sometimes this just happens, and generally, if a HO or customer will work with me, I will work with them. The rebar should have been in the base bid, with the excavation. The concrete conveyer may have been an honest mistake, and should be the GC's problem, but it isn't really unreasonable to hope the HO will share in the expense. We have poured in an un-accesable place before and the concrete pumper I like to use said no problem...but when he came out and looked, he couldn't reach it and we had to get a boom truck out....lots more bucks, but my customer knew it was an honest mistake and carried half the added cost for the bigger pump. Generally, and others may or may not do it this way, I bid on a base for the home, and extras and changes are cost plus. Except the homes I build for re-sale (speculation housing), there will be extras and changes. Hope you work it out with your GC, but my impression is he got in a little over his head...maybe this is his first ICF home? Good luck.
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Ladwig Construction Hennessey, Oklahoma 405 853 1563 Ladwig Insulation & Construction Services Serving Oklahoma Statewide
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#4 | |
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unlicensed hack
Trade: wood butcher
Join Date: Mar 2006
Location: North Pole
Posts: 1,087
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Re: My Gut Churning SituationQuote:
So I call in a bigger crane, all they had available was a 160 footer. Way more crane than I needed, but that was all I could get for the day I needed. Took the operator an hour just to set up and get leveled, another 1/2 hour for take down, not to mention how sloooow this guy was. Long story short.....It cost me more than 4 times the amount I had figured in my bid. The homeowner still does not know anything about MY extra cost & never will. It was my oversite for not figuring in more money for an added expense. I will now take a closer look at truss sizes & site conditions when figuring a bid.
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The views expressed in this post are merely opinions of named poster and in no way shall be deemed meaningful by members of the herd. By no means does anything posted by named poster mean a damn thing for anyone else partaking in this thread. |
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#5 |
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Pro
Trade: underground
Join Date: Oct 2004
Location: Southeast USA
Posts: 3,228
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Re: My Gut Churning Situation
Assuming what you'v represented about your contract is accurate, I can only tell you that as a sub working for a commercial GC I would NEVER get away with what your GC is trying to pull. After signing a contract, the price is the price unless there's an agreed upon change - period.
I agree with the advice about an attorney - get one now. BEFORE you meet with the builder or pay out anymore money, have the attorney make a determination about what the obligations are under the terms of the contract (for both parties'). AFTER consulting with the attorney meet with the builder and decide what will be in your best interest in terms of moving forward with this builder or finding another. I'm sure it's hard not to take these problems personally. It's your home after all and you've entrusted a lot of confidence in the builder. To have that trust and confidence challenged is unnerving to say the least. That being said, resist the urge to take things personally. Keep it business like with the builder and make your decisions with your head, not your heart. If he decides to do differently, that's his issue. If he's a qualified builder, you should try to be cooperative to the greatest practical extent. If it turns out you've made a mistake in hiring him, cut your losses now and move on.
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Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn |
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#6 |
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unlicensed hack
Trade: wood butcher
Join Date: Mar 2006
Location: North Pole
Posts: 1,087
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Re: My Gut Churning Situation
I foresee many problems here Dierks....... One being that since the GC is obviously trying to cover his ass for one reason or another, and you will be confronting him on this (with lawyer by your side), he may try to make up his losses by doing a lesser quality job than what you are paying for. By this I mean..... He will be losing money because of his fault, so to make up that loss, he will cut corners elsewhere. The whole housebuilding experience will be nightmarish for not only him, but more importantly... YOU. Building a new home should be one of the more memborable experiences for people, so it should have GOOD memories. I'm afraid the way it sounds thus far, the GC you have hired could care less what type of experience YOU have. He just wants to make money and move on.
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The views expressed in this post are merely opinions of named poster and in no way shall be deemed meaningful by members of the herd. By no means does anything posted by named poster mean a damn thing for anyone else partaking in this thread. |
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#7 | |
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Moderator
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Re: My Gut Churning SituationQuote:
Approach this objectively and calmly or don't approach at all. Explain your position and then listen to his. If you two can't work it out, you'll both know it soon enough. If there is an arbitration clause in the contract, now would be the time to start using it. As for his invoices, he should have invoices from the subs and suppliers to back up what his invoices are. Its not hard to count for extra rebar, even after the job is covered in concrete. If the plans call for 2K worth of rebar, and he's ordered 3.7K, that is his mistake to own and correct, not yours. Same with all other aspects. Also, ask your attorney about release and partial release of lien. I wouldn't be willing to pay for completed work without it. By the way, there is no such thing as a "standard contract." That's legal and salesmen jargon for "what we usually do", not always what is "customary" for your area.
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"My clients’ wishes are the center of my attention." -- David Guido, a contractor in Woodstock, N.Y. New York Times, July 20, 2006 |
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#8 | |
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Moderator
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Re: My Gut Churning SituationQuote:
I agree with you maj, the GC should always keep his clients wishes first on his list of priorities, IF the budget allows. If not, then one or more parties walked into this situation woefully unprepared for reality. If the GC is worried about money, then he can and should find ways to mitigate his expenses without sacrificing quality, the standards of decency or the requirements of building codes. When that is impossible, and the budget is jeopardy, its time to sit down with the buyer and and discuss hash. GL Dierks, and by the way, this shouldn't be a gut-wrenching experience, but I can guarantee it will be an experience.
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"My clients’ wishes are the center of my attention." -- David Guido, a contractor in Woodstock, N.Y. New York Times, July 20, 2006 |
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#9 |
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Pro
Trade: General Contractor
Join Date: Jan 2006
Location: Chicago
Posts: 1,370
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Re: My Gut Churning Situation
You're having problems like this and he's only on the foundation.
Can you imagine how bad it's going to get after the house is roofed? Run, Forest, Run......Time for a new lawyer and new GC. Good luck to you. |
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#10 |
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unlicensed hack
Trade: wood butcher
Join Date: Mar 2006
Location: North Pole
Posts: 1,087
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Re: My Gut Churning Situation
If the GC is already charging extra for rebar, which should have been figured in to the bid price anyway. The GC was fully aware of site conditions & even requested removal of trees for access, the extra cost of the bigger equipment should have been discussed with homeowner beforehand. An additional $1700 for a longer conveyer seems a little overboard, since he should have already had some cost for that figured in the bid. The GC should have gotten together with his excavation sub beforehand to discuss the level of difficulty for the excavation.
The problem I foresee is this...... It sounds like they are just getting started on this house and already have problems with extra costs. If the GC can't cover the cost of 30 pieces of rebar that he forgot to include for footings(which should be a given no matter how you look at it), then what else down the road has he forgotten? This poor homeowner might be setting himself up for a scammer if he doesn't nip in the butt right now.
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The views expressed in this post are merely opinions of named poster and in no way shall be deemed meaningful by members of the herd. By no means does anything posted by named poster mean a damn thing for anyone else partaking in this thread. |
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#11 | |
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unlicensed hack
Trade: wood butcher
Join Date: Mar 2006
Location: North Pole
Posts: 1,087
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Re: My Gut Churning SituationQuote:
__________________
The views expressed in this post are merely opinions of named poster and in no way shall be deemed meaningful by members of the herd. By no means does anything posted by named poster mean a damn thing for anyone else partaking in this thread. |
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#12 | |
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Pro
Trade: underground
Join Date: Oct 2004
Location: Southeast USA
Posts: 3,228
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Re: My Gut Churning SituationQuote:
__________________
Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn |
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#13 | |
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Moderator
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Re: My Gut Churning SituationQuote:
__________________
"My clients’ wishes are the center of my attention." -- David Guido, a contractor in Woodstock, N.Y. New York Times, July 20, 2006 |
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#14 | |
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unlicensed hack
Trade: wood butcher
Join Date: Mar 2006
Location: North Pole
Posts: 1,087
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Re: My Gut Churning Situation Yeah, I follow you D-A Which is exactly why I asked this in the very first post. Quote:
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The views expressed in this post are merely opinions of named poster and in no way shall be deemed meaningful by members of the herd. By no means does anything posted by named poster mean a damn thing for anyone else partaking in this thread. |
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#15 | |
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Moderator
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Re: My Gut Churning SituationQuote:
![]() Time to do some homework and change outfits!
__________________
"My clients’ wishes are the center of my attention." -- David Guido, a contractor in Woodstock, N.Y. New York Times, July 20, 2006 |
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#16 |
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Registered User
Trade: Homeowner
Join Date: Aug 2006
Posts: 3
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Re: My Gut Churning Situation
All of your responses have been great, I appreciate the different perspectives you bring to the issue. I’ll address some of the questions that have come up to help clarify and provide additional material for comment.
No, this was not the cheapest bid we received. In our area ICF builders with experience are not very common. We had to balance cost versus experience, this is definitely not this builders first ICF home. The GC rep we deal with has 20 years in the construction field and references we checked had good things to say. Also, co-workers of my wife built with them just this past year so we had pretty reliable references. License, insurance etc. etc. all look good and there have been no indicator of this being a shady and irreputable. At some point you either have to invest trust in the contractor or build the thing yourself. I have thought about getting the lawyer involved but wanted to give the GC a chance to air the dirty laundry and give a proper explanation for what is occurring. That’s where that trust comes into play. Now, if at the meeting all they have to say is Hem & Haw and Fork over the Cash then the first call as we walk out the door will be to the lawyer. We have already authorized the first draw. We are not planning to authorize any other payments until the situation is clarified. We do plan to keep it professional at the meeting. That is very good advice. There is no reason to make it personal. If we were to do that at this stage of the game it would create nothing but bad blood for the months of construction remaining. It may be a mistake on their part and I will at least give them the chance to fix it. We are building our dream home. It of course will have its ups and downs but over all we should have those Good Memories about this. One of the reasons I have the churning gut is that the GC did not give us any warning about these soon to be arriving invoices. I guess it was left to the USPS to be the bearer of bad news. It totally wrecked my weekend because all I thought about in my spare time was addressing this. As far as the taking notes goes. While not as good as I would like I have a dedicated notebook where I record meeting times, phone conversations and site visits. I also have retained every single email from the GC office staff. I do not want this to be the horrible building story. I want to sit down, hash it out and move on with construction. Until these invoices arrived I did not consider the possibility that they would attempt to rake us over the coals like this. What approach would you take in the meeting itself? What would you address first? Thanks again for you feedback! |
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#17 | |
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Pro
Trade: manager of excavation division
Join Date: Dec 2005
Location: danbury,ct.
Posts: 3,660
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Re: My Gut Churning SituationQuote:
with relation to the site work ie. ledge, excessive water, ect. which would warrant an extra rebar band going around the footing , and would also relate to added excavation expense.
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___"Remember You Never Get A Second Chance To Make A First Impression"______________________ Joe |
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#18 | ||
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Pro
Trade: underground
Join Date: Oct 2004
Location: Southeast USA
Posts: 3,228
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Re: My Gut Churning SituationQuote:
Quote:
__________________
Fortunately I keep my feathers numbered for...for just such an emergency. -Foghorn Leghorn Last edited by PipeGuy; 08-01-2006 at 05:40 PM. |
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#19 | |
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Moderator
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Re: My Gut Churning SituationQuote:
You to him "Tell me how we can help you out here. Seems that our contract isn't covering what it is supposed to cover. Can you explain how and why this is so? Are there change orders for his extra material and work?" etc... As far as lawyer goes, don't wait. He is the only one who can explain your legal footing in this situation and advise how best to proceed. Call your lawyer now. Go see him today or tomorrow. Contacting him doesn't mean you're suing or starting any action against the contractor, what it means is you have done your due diligence and gotten good legal advise. Quit stalling.
__________________
"My clients’ wishes are the center of my attention." -- David Guido, a contractor in Woodstock, N.Y. New York Times, July 20, 2006 |
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#20 |
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Pro
Trade: excavating / concrete / masonry
Join Date: Feb 2006
Location: NW, CT
Posts: 2,452
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Re: My Gut Churning Situation
Is this a Contractor's Forum or Homeowner's Advice Forum?
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Nick "Every day I remind myself that my inner and outer life are based on the labors of other men, living and dead, and that I must exert myself in order to give in the same measure as I have received and am still receiving" Albert Einstein |
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