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Hello out there. I have a very difficult situation on my hands that I need seasoned advice on. I've done about $ 110,000.00 of work for this development co. They've paid all but the last $ 40,000.00 which is all T & M work. There was never a contract because there were several different phases that were nothing more than a handshake. We worked for a Gen. who worked for the developer. I have documentation of his acceptance of my invoices, but now he tells me that the agreed upon labor rate of $ 40.00 per/hr. per/man has only been approved for $ 28.00 per/hr. Leaving a difference of about $ 14,000.00. I've filed a pre-lim, but am not sure what to do next. There position is "it's an unspoken rule that sometimes you have to take it in the shorts" that's what the Gen. we were working for told me to my face, after we killed ourselves making him look good and him telling us he'd take care of us, don't worry. Any advice is welcome
 

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mvendi said:
...Their position is "it's an unspoken rule that sometimes you have to take it in the shorts"...
1. Good, then he shouldn't mind "taking it in the shorts". A deal is a deal.

2. Make sure that you give this guy lots of free advertising. He deserves it.

3. I'm not a lawyer, and I'm not going to pretend to be one.

I am assuming here that you are telling the truth, and also that you earned the $40.00/man-hr and didn't take advantage of him.

One other thing: Been there, done that. Hurts. Once.
 

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You just paid $14,000 for your diploma from "How to do business the right way" School of Hard Knocks University. Now you know to never ever do work without a contract. Never, ever, ever! The funny thing about that school is the tuition is different for everybody. Some people get their diploma for free, some pay a few hundred and earn theirs and some will pay even more than you did.

Without anything in writing it is going to be almost impossible to prove your side of the agreement. You probably know better than anyone what avenues are available to you. If you have anything in writing from your earlier payments from him that indicates the correct hourly wage was paid that would certainly help you show that the rate for the rest of the work was based on the same rate.
 

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mvendi said:
I've done about $ 110,000.00 of work for this development co. They've paid all but the last $ 40,000.00 which is all T & M work... now he tells me that the agreed upon labor rate of $ 40.00 per/hr. per/man has only been approved for $ 28.00 per/hr. Leaving a difference of about $ 14,000.00. Any advice is welcome
What kind of work did you do? If my math is correct you applied 1166 manhours worth of resources towards the work (1166hrs X $12/hr = $14K) - that's no small piece of work. If I made a good dime on the work, even with the $14K cut, I'd put it behind me and start looking for the next chance to work for them.

But...if I was taking a hit on it:

1.) I'd want the GC to show me all the other "approved" rates. Maybe some are higher than billed and I'd want to re-bill at those rates.
2.) I'd consider removing, or otherwise making unusable, 30% of the work I did ($12 is 30% of $40).
3. I'd ask the GC to arrange a meeting with the Owner to go over the reasoning for the price cut.

mvendi said:
"it's an unspoken rule that sometimes you have to take it in the shorts" that's what the Gen. we were working for told me to my face
The GC is an as$h*le. Unspoken rules are just that...unspoken. You don't go around explaining such rules to the sub whose shorts are down. I'd probably decide not to work for them again - I'd be too tempted to find the first opportunity give him a taste of the rule. Feeling that way about a customer is a recipe for disaster.
 

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First job I ever did was a small pressure washing job. I told them the price they said start. When I finished they say I blew off a shingle on the roof...which ofcourse I had allready pointed out to them. "oh yeah that shingles been gone for years."

After 2 months and them threatening to sue I didnt persue the issue. I did write a DETAILED 3 page contract for just the pressure washing aspect of my business.

Two months ago I went and priced a rather large wash job for a friend of 10 years, I wrote the contract, and asked him to sign it. "Your kidding, we've been friends for years" he say. "yup, and I wanna keep it that way" says I.

I really do feel for you. I dont blow my nose now without a signed contract for any work done.

Im not sure what part of contractor folks dont understand. Hope it works out for you.
 

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I ate it for $12,000.00 many years ago. It turned out that this was 'the magic number', or just about what it would cost in legal fees to recover. You lose either way.

Unfortunately for him, he didn't understand how well connected I was in our small county. I 'advertised' like crazy for this guy. Subs wouldn't work for him and he ended up with a crew of 'soup kitchen' guys, inside of 2 yrs. his doors were closed.

Don't get mad, get even!
 

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donb1959 said:
...When I finished they say I blew off a shingle on the roof...which ofcourse I had already pointed out to them. "oh yeah that shingles been gone for years."
A digital camera is a wonderful tool.

I LIKE Teetor's story.
 
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