Sub Asking For More $ After Final Bill Paid

J.Vick

I need some good advice on how to deal with this, here is the story.

I am a General Contractor building a spec home right now. I hired a concrete company for the foundation and they said they could excavate also. I accepted their estimate and away we went. The job was a management mess from the beginning. The actual excavator wasn't available to see the locate on the property and he hit a gas line and a water line. I was the one that called for locate, because I knew they dropped the ball on that. The gas line was fixed but the water line still needs to be fixed. They have accepted that they are responsible for fixing the water line.

Here is where things get interesting. We paid the final bill brought to us for the building pad at a cost of $9800. We were happy (to be done) and the job was over. A couple of weeks later they called and said that they recieved their bill for the rock hauled in and it was much more than what they billed us for. They billed us off the excavtors wrong calculations onsite. There were a couple of issues with the pad being made too big in one area, and too small in another that they had to bring in more rock and fix. They were reading their string lines wrong. A lot of poor communication and management on their part. After we paid, they want another $7500!!!! They showed us a break down in their costs and it shows another $4500 in rock, and another $3000 in profit!!! Is this crazy to come back and ask for more money after the job is paid? And to try and ask for a 25% profit on the job that has been the biggest mess from the start. I don't understand why they think this is ok? Shouldn't their 25% be in the first $9800 bill? Is any of this my problem? The twist in all of this is they still haven't fixed the water line at a possible cost of $2000 and they have a deposit from us for the foundation of $6500. Can we hand them a cancellation of job and expect our deposite back? I know they want to keep it and roll it over to cover their ass, which is BS. ALL ADVICE IS WELCOME. If you need more details, just ask.

Thanks

jmic

J.V.
So the short is they moved on site, hit a gas line and water line, never called the locate co. Dug your basement and hit what excessive water in the hole? Dug the hole wrong, haven't done foundation yet and want more money?

__________________
___"Remember You Never Get A Second Chance To Make A First Impression"______________________
Joe

J.Vick

Jmic,
The water line was not charged, so there was no excessive water. Right now the pad is finished and ready for foundation. The problem is that after they gave us their final bill and we paid it, then they came asking for more money. They are saying that they mischarged (forgot to charge) us $4500 in rock and $3500 for their overhead.

Thanks,
JV

Same Old

Did they give you a lein waiver in exchange for that check?

Did they pay for their concrete yet?

Nobody gets a check from me until they sign a waiver.

I'd tell them to go **** themselves. If they don't like it they can deal with my attorney, he'll want to talk to them since he's working on the suit against them for all the damage done.

J.Vick

They haven't paid for any concrete yet. We haven't given them the okay to start the foundation; they just have our deposit. I'd love to tell them to **** themselves, but they have our money for the foundation deposit.

Bone Saw

...

__________________
Custom Decks & Carpentry LLC.
Chester County Custom Decks
Custom Deckbuilder Mainline
Philadelphia Deck Builder
Custom Decks & Carpentry on Facebook

tgeb

It looks to me as though they hired the excavator and want you to pay for the mistakes that their excavator made.

To me the liability is on them, had you hired the excavator and allowed him to mess up, then the foundation contractor had to fix it, then I could see them wanting to charge you.

$4,500 worth of stone is an awful lot of stone to fix a basement sub-grade, can they back that up? Did you see these problems and the fix also?

I don't think you should have to pay these excess charges, but these guys have you by the short hairs and I don't see an easy way out, short of loosing your deposit and having to take them to court to get it back.

If you let them proceed, then hold the final payment, they could lien your property.

In short...I don't really have any advice, sorry.

__________________
Tom

www.gebcon.com

J.Vick

It seems like everyone is in agreement that the excavators are at fault; they billed us incorrectly. We are considering paying them for half of the rock that they billed us incorrectly for ( we saw the bills they got for the rock delivery). We feel like there is no way we should for their profit, though. Would any of you try and come back to a customer or GC asking for more profit because of your book keeping errors?
It seems the easiest thing to do is have them do the foundation- since we signed a contract and they have our deposit they have to complete the work, right?

jmic

JV My question was why all the stone? Did you run into excessive ground water? (not from the water line ) I don't understand what all the rock was brought in for. What are the soil conditions like where this was done?

__________________
___"Remember You Never Get A Second Chance To Make A First Impression"______________________
Joe

jmic

Are you absolutely sure they are competent to do a good job on your foundation? That can be your second big mistake. In my opinion the first was giving these clowns a deposit for foundation work that was not even ready to start. If you had not used these contractors before you should have taken it one step at a time.

__________________
___"Remember You Never Get A Second Chance To Make A First Impression"______________________
Joe

J.Vick

There was a lot of rock requried for the pad. We usually don't have basements here in Oregon. The property has about 5' of a weak brown sandy clay on top of a sandstone bedrock. Our Geo tech required us to excavate to sandstone and fill with 4" minus. There is a lot of water running through the property. In the deepest spot of fill there is almost 5' of rock. There is no doubt that the rock is out there. The showed us all the bills for rock hauling. They should have waited to bill us until they got their bill. I understand that they screwed this part up.....but trying to back charge for $3000 is overhead????? Where do they get off? I don't send customers and invoice for lost profit a month after the job is done, or ever. Do you think we should go ahead and have them complete the foundation so we don't looose our deposite? Don't they have to since we have a signed contract?

I REALLY APPRECIATE ALL THE ADVICE!!!!

J.Vick

I agree that we should not have given them a deposite for the foundation. At the time we were supposed to start the concete in a couple of weeks, still my fault. I know now that they are 95% a concrete company and they were trying to learn to be excavators on my dollar. In the beginning the owner was supposed to do the excavation himself, but that never happened. The excavator that was out there doing the work, was hired two days before he started our job. I feel that they could execute the foundation properly, and this would be the best way to keep from loosing our deposite. That I shouldn't have given them. They also never sent a right to lien for the job.

Grumpy

I didn't read your whole post. I stopped at "they called with another bill..." Didnt you have them bid this BEFORE you started or are you in the habit of writing blank checks to your subs? If they bid this, then IMO they are entitled to their bid. If you give them anything more than their bid, it will be based on your relationship with the sub; IE: how much work you have done together in the past and how you paid them for those jobs.

I play both sides of the fence sometimes being hired to be a sub and often times hiring subs to do my isntalls. I know I have gone to builders to ask for extras and I know my subs have come to me to ask for extras. I almost always provide fixed lump sum bids to my customers, contractor or consumer. Most of the time my subs work of a negotiated peice work price list and we know upfront what they are going to earn on the job, however if they incur some sort of additional charge and they can prove to me there was no way around it and it was an oversight on my part... I will pay it regardless if I will get paid for it.

If my subs provide me a lump sum bid on anything... so sorry so sad. I am basing my price on their price. However if they are asking for extra money for something that wasn't in the original bid... Can we say change order? It clearly states on a work order that they have to tell me about any additional costs immediately.

J.Vick

Of course we got a bid, and no, we do not write blank checks to any one. They gave us a final bill for their completed work, which we paid them.
The problem is that their employee reported the wrong amount of rock, and instead of waiting for their bill from the hauling company they gave us the final bill. The problems that I have with this are 1) this was not just a minor oversight- they are trying to charge us $4500 MORE than we already paid in rock costs alone. 2) they are trying to charge us for profit they failed to include in the final bill that we paid.

This whole messy situation is due to their oversights, miscaluclating, and bad communication between themselves & their employees.

mahlere

jvick,

i understand what grumpy is saying, but i don't understand what you are saying.

if they gave you a fixed price for the job, say $10,000 for everything...what difference does it make if their employee gave them the wrong counts?

was their contract for $8000 +rocks? or $10,000 including rocks?

i'm not sure where the problem lies. but talk to your attorney, you would be surprised what a letter from an attorney does.

jmic

Grump,
Unlike most trades in construction when you're dealing with excavation there are many unknowns that you will encounter underground. Sounds to me like they hit excessive ground water and poor soil conditions as they were into the job and per the site engineer had to bring in lots of rock to get a stable base. This being said if accurate although perhaps there should have been better communication between G.C. and the sub on this scope of work, it does seem like in fact the monies is due to the sub.
Now J.V. are you sure that the 3000.00 that you're calling profit isn't in fact for extra labor and machine time in dealing with this problem and the time to place the extra stone that they didn't realize went into the site till their bill had been sent out? Hope this isn't to confusing.
Here in New England we run into these kind of problems on a regular basis and it can be very costly to remediate, and often unknown till you start to excavate.

__________________
___"Remember You Never Get A Second Chance To Make A First Impression"______________________
Joe

J.Vick

Their price was a fixed price- $9800. That included everything.

Same Old

Then it's their problem.

jmic

Then thats ignorance in their part, no way would I or most excavators give a fixed price without having an exclusion for unforseen subsurface ground conditions.

JV did the site engineer have the site plan all spelled out showing the conditions that you ran into would be there along with the remedy to correct the situation?

__________________
___"Remember You Never Get A Second Chance To Make A First Impression"______________________
Joe

Grumpy

I can understand that, and if I were in the business of building, as the GC I would know that... and if I were in the business of dirt, as an excavator, I would also know that... and I would plan for it.

Most of our work is exterior remodeling, being not new construction. Many of the roofs require substrate/decking repair. I am upfront about this. It is an unknown. I tell the customer it is an unknown. I write it into my proposal that it is an unknown, and that extra charges will apply.

If it is a common occurence, I agree with you the sub should have had better communication.