Hi,
I’m looking for advice on how to handle a settlement offer from our GC–long story short, we hired him last May to finish a 900-sq-ft basement (was unfinished space in new construction–we hired him to do everything: studs, insulation, electrical, drywall, carpet, paint, and put in a full bath). We figured this would take 2 months, tops. It took him 6 months to get to the drywall stage, and after we got a lien on our house from the framer and found out he’d stiffed the plumbing and electrical subs too–and after 30 days went by without seeing a worker, despite his almost daily promises–we kicked him off the job for abandonment.
We hired subs directly to finish the job and are now trying to get him to cover the difference between what we still owed him under the contract (about $4K) with what it actually cost us to get the work done (and pay off the lien) — about $16K. He is trying to avoid court (already has one judgment against him for another client he walked out on last year) and has offered “to make payment for the unfinished portion of the work, as determined by Means Residential Construction Costs Directory, the standard in the construction industry, minus the final payment amount that was due.” For one thing, this seems suspect because I assume the costs directory addresses contractors’ costs, whereas we had to pay retail to get the work done. Is that right, or would this directory show retail costs? In other cases, how have folks tried to come up with what the “reasonable” cost would be? (Obviously, I feel that what we ACTUALLY PAID to get the work done is the reasonable cost, but I doubt we will ever get $12K out of him).
Thanks for your help. This may all be academic, anyhow, as it’s unclear if he has any cash at all. Last October, when the framing sub put the lien on our house, we called the GC’s bank (got the info off a cancelled check) and asked them if a check for $3K–the amount of the lien–would clear. We’d given him about $30K at this point, and he’d only done about $10K worth of work. They said “no.” So we know the money is long gone…probably up his nose or with his bookie. I’m afraid he may be signing up a new customer, and will take their deposit and give it to us to get us off his back, then screw them.
Edited 4/2/2007 10:53 am ET by mforbes
Replies
Means is a guide, not a standard. You don't need a guide, as you already know the numbers.
See an attorney at least once. Also ask about community property and discovery.
Small claims court, eat the difference between their limit and $12K. Get a marshal and take his truck, backhoe, and hammers and nails, then go by his bank and close his and his wifes' accounts.
SamT
Anyone who doesn't take truth seriously in small matters cannot be trusted in large ones either. [Einstein] Tks, BossHogg.
Just as diffeerent people can read the bible and get different things out of it, the Means cost estimating guide can be a hit of miss proposition also.
Thy are more geared to commmercial than residential and like has been mentioned, the book is only a guide.
You have to be very experienced to use it.
If means is his guide, that can explain why he is in financial trouble. No sense in letting his trouble be yours.
An example -
If he reads in their that wall framing should cost X per lineal foot and applies that only there is no way it will be accurate.
That is for platform framing new construction with precut studs. The need to fit conditions in a basement means it can take three times as much labour to build.
And that is after he gets the 2x4s down there. He probably failed to note on some other page the modifier for above or below grade, which takes extra labour.
That is just one example. ALL remo work ( which this is since you are living there) is more expensive than new work.
I'm curious on one thing - "We figured this would take 2 months, tops. "
who is We? Did you make an assumption or edid he make that a promise? It would be a pretty tight schedule for me to do it that quick.
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It would be a pretty tight schedule for me to do it that quick.
But 6 months and only at the sheetrock stage aint exactly kicking azz now is it! <G>
I wondered about the "we" too but this time I think the OP'er is probably more in tune then the GC.
Doug
right on both
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Tight schedule? Wide open new construction basement finish, 900 sf, includes one bath?
There's a pretty well-documented photo journal I'm sure you've seen right here on Breaktime, in which McDesign shows us how to rock-n-roll when working solo, one big long set of steps up, dealing with old existing framing, etc. Looks like at least 900 sf to me.
His first post was about mid January, which puts him at a little over 2.5 months to now, and he's in the home stretch, with another start scheduled pronto.
I stay off most of the photo threads simply because it takes sooooo much time to download.
So i have not seen that yet.But from what I have seen of McDesigns's work he is a real dynamo, someone most of us would have a hard time keeping up with.
You wanna try him, old man?;)
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Stay tuned for the little house my pard and I will start as soon as the frost is all out of the ground. I'm gonna photo-essay it here, and the thread will show way more than carpentry, 'cause we are doing just about everything ourselves, sitework to finish. It won't be fast, but it should prove interesting.
I don't think Forrest is a dynamo, actually. I just think that he has figured out ways to work solo, and efficiently. He also preplans everything and uses a lot of shop-built components. This all combined, makes for a quick job, IMHO.
The best education I ever got on what could be done working solo was spending three weeks working alongside the Amish framing crew that got us dried in on an owner-builder thing we did in the midwest. As a crew, they came together in twos or more only to do those tasks that required it, such as wall raising. Otherwise, they were split out solo, and knew every trick there was to accomplish stuff working that way. All action and hardly any talk. It was amazing.
What if you are required to use a licensed plumber, electrician, and HVAC contractor? That can add three weeks to a basement right there.
Jon Blakemore RappahannockINC.com Fredericksburg, VA
What does "licensed" mean?
What do you think?
Jon Blakemore RappahannockINC.com Fredericksburg, VA
I'm clueless.
Apparently something that greatly adds to the time required to complete a task, right? Since cost correlates to time, then "licensing" must greatly add to cost, correct-o?
I've a close friend in Spotsylvania, with whom I'll have a conversation and see if he can explain this "licensing" thing.
Gene,I'm sorry, when I read your post I thought you were picking on an incorrect spelling of "license" (my first thought was it should have been "liscense"). Now I looked it up and realized that I was right in the first place and you weren't just being a smart aleck like I first thought. My apologies.Now, on to your original question. The OP said that they expected the basement project to take two months. Piffin commented that two months was moving along at a decent clip. In my experience (with my company), I would agree.We have done jobs finishing off one room in a basement (very expensive per SF) and basements up to 2,200 SF. For the most part, any project can be done in between 5-9 weeks from receipt of building permit to final inspection.A typical basement job for us would entail us doing the framing and trim work. We would use subs for MEP, GWB & Painting (same sub), carpet, tile, and insulation (if needed). I'm sure we could move a project along more quickly if we did the GWB, painting, and tile in house and did not have to work on multiple jobs at one time. But the reality is a basement project will not even come close to sustaining us for even four weeks so we choose to sub out the items I mentioned.In VA, the MEP trades must have Contractor's licenses and Tradesman licenses. In order for me as a contractor to pull a permit, I must submit an affidavit for all three subs stating their license #'s and that they will be doing the work. This licensing requirement practically forces us to use subs for the MEP portions. This means that a week will be for rough-in and a week for fixture set, best case. Maybe others have subs that can respond more quickly but that is where we are at.Licensing is not the biggest hurdle we face in maintaining a schedule- using subs is. But like I said, it's the way we're able to do what we do so we make the best of it.Forrest is moving along at a decent clip, but I think he will be 3.5-4 months when all is said and done. Does your close friend have anything to do with the TT plant off of Mine Road?
Jon Blakemore RappahannockINC.com Fredericksburg, VA
I was being snide, actually. Sorry.
Where I am, anything at all can be done inside a house in the way of remodeling, without need for any kind of permit, plans review, or anything.
Furthermore, my part of NY state has no licensing requirements for contractors of any kind. Period. Not for electricians, not for plumbers, not for GCs, not for anyone.
We've never done a basement upfit, but heck, it ain't rocket science compared to the stuff we've done in new housebuilding and big add-ons or high end kitchen upfits. I certainly cannot imagine spending nine full weeks of work doing one.
you've never done onebut if you say so, it must be true
Barry E-Remodeler
You're right, Barry. I've never done one. So how can I possibly know anything?
But I did stay in a Holiday Inn Express last night!
We owned a house in Fort Wayne, IN, that had its basement flooded by a massive storm drain backflow one spring. We took 5.5 feet of water in a 9-foot basement. I hired a contractor to rip everything to the bare 'crete walls and refit the whole thing. One small room, one "greatroom" with wetbar and minikitchen, one full bath.
The ripout took more than one half-sized dumpster. My mistake, I thought everything would fit. The bathroom was not replumbed, but the slab was busted out to enable access to the sewer line so a loop-up, backflow preventer, and gate valve could be installed. At the other end, some more slab surgery and plumbing was necessary to add a sump pit and pump, plus discharge lines.
Since we were in a ripout mode, I had the ceiling lighting, which had been poorly done, all changed out and reconfigured.
My guy was an all around mechanic, had a helper, and his father did the electrical and plumbing work. No permitting was required. I helped by doing some but not all the trim carpentry.
The work took less than six weeks start to finish.
Other than doing the basement finishes in the new work we've done, we've never upfitted just a basement, but as I said, I cannot imagine spending more than nine weeks in one. It would be too much like being in jail.
Gene
I'm involved in a basement job right now, side job.
The house is 2 years old ranch, 1700 +- sq ft.
The guy I work with daily plus a friend of his and myself framed the whole thing out in two days. Dont know if thats slow or fast cause I'm no framer, hard as it was I just followed orders on this deal! We did this 1 month ago this weekend.
The HO is doing all of his own electrical and plumbing. I've aranged for the rock and taping and the same HO is going to do all the trim work except for hanging the doors and the cabinetry - bath and some built ins for entertainment room.
I was over at his house the other day to get final sizes for cabinets and his plumbing and electrical are done, he had inspection scheduled for the following day, never heard anything back from that so I assume everything went OK. Rock was scheduled for sometimes after that and I'm delivering cabinets on or about May 1.
After my cabinets are installed and the doors are hung I'm done. I get my final check. He will still have the bathroom to finish - set the shower, final plumbing, tile the floor and do all the trim work in the basement plus finish all the woodwork.
If this job drags on past four months I'd be surprised. Both me and the home owner have other jobs so this thing isnt getting any priority on either of our parts. Well maybe his, he's got a daughter that is hounding him for her bedroom to be finished down there, and I think she has the backing of her mother - I'm sure that adds a factor of 2 or 3!
The basement isnt anything fancy but its got two bedrooms, a storage room, mechanics room, bathroom, entertainment/media room and then just another big lounging area, and a couple three closets.
Just a little perspective from another angle!
Looking at the calender I see I better get my azz in gear if I'm going to deliver cabinets in two weeks.
Doug
Edited 4/8/2007 11:40 am ET by DougU
Doug-
I'm not criticizing, but wondering...
do those basement bedrooms have access to the outside? Around here, inspectors are REAL fussy about that. All bedrooms have to have a way out in case of fire.
I turned down one basement job when the people told me they wanted a bedroom in the basement, but didn't want to pull permits, or have proper egress.
I don't need that kind of liability.
Both bedrooms have egress windows.
I let him be the GC on this though cause I wasnt going to see it to the end.
City didnt make him get a permit, told him to do the work and they'd come inspect! dont know whats up with that but maybe its cause its a small town - still has permitting requirements though.
Doug
You're lucky.
I've had inspectors stop by on jobs just to see what's being done, and to make sure any needed permits were pulled.
I guess they've got to justify their existence.
" I certainly cannot imagine spending nine full weeks of work doing one."In that case you will need to quit imagining and take the testimony of those who have. Basements can be one of the more difficult challenges in remo work, especially when a family is living in the house.
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We were living there when my contractor finished ours, in less time than what is being discussed.
I'm quitting the basement topic. It's beneath me. ;-)
In my part of the country you have to have ;
rough framing inspection
rough plumbing inspection
rough electrical inspection
rough heating inspection
insulation inspection
final plumbing inspection
final electrical inspection
final heating inspection
occupancy inspection
These inspections add weeks and cost to a project. But, you could also not pull a permit and lock the front door and don't answer the doorbell. I'd advise not having any signs on your truck.
Means does have a retail guide for homeowners:
"Interior Home Improvement Costs--How Much Will Your Project Cost"
This guide provides two examples of basements finished that are about the same size as yours with a price range of 14K to 22K.
I find this guide to be more helpful in many instances. That said, You know the real costs...so the guide pricing is academic.
In future dealings with contractors, always obtain lien releases before paying any progress payments. This will at least let you know where your inital deposit was spent. This means the GC would give you a parital lien release for every sub or vendor he has paid, before he is paid for more work completed. These forms can be found on many accounting programs or can be purchased at stationary stores.
Lien waivers obviously would have been a good idea, and I should have known better. I actually gave him the third (and last, until the final 10%) progress payment before they had actually completed everything associated with the second progress payment, because they were moving right along. I'm not stupid and this was not the first contractor I'd ever hired, but I apparently erred too far on the side of being a "good customer" and "prompt payer" when I should have been more cautious.
Two months seems reasonable for what we needed--now that we are done, if I think back on how many days we actually had workers here, it probably took 30-40 work days (so, about 2 months if they had all been scheduled 1-2-3) to complete the basement.
Thanks for the info on the Means guide. As we could have guessed, he has not actually gotten back to us with any kind of settlement figure. Our next stop is court.
Sorry to hear about your dillema. Not seeing it in person and knowing the condition of things prior to his starting it's very hard to say how much the work is actually worth.
If he hasn't done the work as a LLC consider yourself lucky since a LLC can fold and never have additional assets, but an individual is much more likely to have a future income stream and assets that can be used to repay what you're owed.
Having said that, this industry is full of holes carpenters can fall into and never be seen, skirting both the IRS and anyone else they owe money to. One "successful" remodeler deals 100% in cash transactions and doesn't even have a checking account. I always wondered who he was running from.
I can't add any useful information, but best of luck getting your project finished and getting to a point the failed project is behind you.
Beer was created so carpenters wouldn't rule the world.
The whole thing is a disaster. The guy is incorporated, so we can't go after him personally (even though all evidence points to corporation=him alone). The original GC, of course, never got back to us last week with any kind of offer, let alone one based on the mean's guide. He did tell me the name of the company that supposedly owned the 40 yd^3 dumpster that's been in my yard since June, they came by and said it's not theirs and I am going to have to find someone to haul it and pay for that. And we just realized that the replacement contractor we hired walked off with almost all of my hand tools and some of my power tools (we already called him, he said he'd ask the crew if anyone "accidentally" took anything, but I doubt I'll ever see any of it again). I have had it, had it, had it with the sliminess and sleaziness and total lack of accountability.
mforbes..... if there is enough PERSONAL assets, then it would probably be worthwhile having a lawyer go after him...
most slipshod contractors who are incorporated are also slipshod in maintaining the records and doing the things you have to do to maintain a corporate veil
they will not have the correct minutes, they will intermingle funds, they will do a lot, or all of the things they are not supposed to do to keep their private selves separate from their corporate selves
a good lawyer can easily penetrate a poorly maintained corporation..
personal injury lawyers do it all the time ( or so i am told )
Mike Smith Rhode Island : Design / Build / Repair / Restore
To second Mike's comments, When I incorporated, my lawyer and accountant both emphasized that the main benefit to me would be tax savings and not liability protection. They said I would have to be a fanatic in record keeping to have minimal liability protection from the corporate shield and that it is common for lawyers to penetrate that shield.hire a good lawyer and go after him.
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