Found an issue on this page? Let us know and we will look into it as soon as possible.
My general contractor refuses to finish work unless I pay him the remaining $2,800 he says I owe in change orders.
Anonymous7 views5 answers
Made the mistake of hiring my neighbor as my GC, and he says we owe him an additional $2,800 in change orders. It started out at $5,600 and we paid one-half. We don't want to pay him anymore because he has yet to finish many items on the punch list I came up with, has yet to finish a lot of the interior finish work, and much of the finish work he has done is substandard. We are basically at a stalemate because he won't do anymore work unless I pay him and I won't pay him unless he does the work. He lied to the mortgage company saying the work was 100 percent complete, thus he received the final installment payment from them. He presented us with the $5,600 bill after we moved in on 28 February 2014. Need to know what my options are in order to get my house completed. Sue him or pay him?
I believe it would be silly to pay him; you state that the quality of work was bad so there is a workmanship issue here for work already 'completed' and paid for; so, to pay anymore would be to pay for substandard work. So much will depend upon what your contract says. Unless you have a written contract that states different, it is customary to withhold some funds pending the completion of punchout items. You should retain a lawyer to send him an appropriate demand letter notifying him of the substandard work, demanding that the substandard work you have already paid for be corrected. Be sure to hire a lawyer who has some experience in construction law matters because there are some specific issues that need to be addressed and raised in the demand letter and I've seen non-construction lawyers miss them completely in demand letters (when I've represented a contractor).
It sounds like your choice is to pay him or get another contractor.
Or, get a lawyer to send him a demand letter.
You can tell him that it is customary to withhold 10% until punch list is complete.
If that doesn't work, give a local lawyer a call.
-- I assume you do not have a written contract?
Good luck.
Understand your lien risks, if any. If this is homestead, both you and your wife would have had to sign the contract with GC and he would have had to file that of record before beginning work. Failing that, he can't lien you which will significantly improve your bargaining situation. A sit down with an attorney will pay for itself in this case.
The payment/performance obligations should be clear in the contract and change order language. Revisiting them, with the help of an attorney, may answer your question. It is not uncommon for change order payments to be due in full when the change order is signed. It is also common for all money owed to be payable at the time of substantial completion, with a holdback equal to the cost of completing the punchlist items. As each item is finished, that portion of the holdback tied to that item is released to the contractor.
Suing the contractor will cost you multiples of the amount in dispute, with an uncertain outcome. Best if you and the contractor can find a quick and reasonable resolution. You might both disagree that the resolution is "fair" but if it gets the project complete and you can both live with it, then it is probably a win for you both.
What does your contract say? That will control. If you have nothing, well then,
Lawyer up and always fight with your neighbor... which at this point may be moot.
Hire another person to finish and sue the neighbor
Pay him off and take the chance he will or will not finish.
