Hello, I had a home built last year, and have a question concerning the responsibility of the general contractor after the home is competed and paid for. Our builder was an acquaintance, and had a reputation for doing good work on custom homes. Up front, he said he does not bid on jobs. He builds only on cost of construction, plus his 20% builders fee. Talking to some of his previous clients, they were satisfied with his work. 20% sounds like a premium mark up, but I don’t mind paying a premium if I get a premium product and service. We signed a contract.
The house was built over the course of a year (completed Jan. ’03). There were certainly a few glitches along the way, but I’m sure that is to be expected with something so complex as a house. I questioned a few things as the house was going up, but hated to be too persistent. Nothing worse to me than someone coming in to my business and telling me how I’m supposed to be doing things. I figured that he is the general, and thus smarter about construction than I. The house was completed to the tune of a little shy of half a million dollars (gulp).
One of the concerns I had, was putting the tankless propane hot water heater in an accessory attic. I was assured that these heaters are made to be mounted outside, and freezing wouldn’t be a problem. We have a basement, where the water and propane pipes originate, that made more sense to me. Well, with the cold weather last month, guess what happened. Fortunately, no pipes burst, but the water was frozen up until I took a kerosene heater apart so it would fit thru the access door to the attic, reassembled it, and ran it a while. I called the builder to let him know what happened, and he said he would come out the next week.
This is a weekend house for us, so we were not there when he came back. He brought his electrician, and they wired a new electric outlet in the attic and plugged in a ceramic heater. He he e-mailed me and said this should solve the problem.
Giving this some thought, I didn’t feel comfortable having a heater running in an enclosed, difficult to access space. Plus, the idea behind getting the tankless heater was improved efficiency. Seems to me, a 1000 watt heater running for 3 months will put a dent in that. I noticed that the supply and return lines for the heater ran on top of the attic joists, and had foam insulation around them. I pulled the insulation from below the pipes (between the joists) and placed it over the pipes and joists. Also added more insulation, and removed the heater and plugged in a light bulb that sits beside the heater for better efficiency.
We have had more cold weather since, and so far no problems. Now what I think is the kicker- got a bill in the mail for the electricians services and the heater, but no builders fee. I mailed him the check ($120) along with a letter stating what I had done, and also asking what kind of warranty I might have for future “design flaws”. So far no response.
So… my question is, am I unreasonable to have expected the builder to take care of something like this… with a smile… and with out a bill. Had I been the one to insist on putting the heater in the attic, I could understand. Since this was built as “cost plus”, is this just considered a continuation of the project and something I should have expected to pay for? Also, I don’t see why it would be such a big deal to move the heater to the basement now. Seems things are sort of “rigged” at this point, and with an extended power outage I might still have problems.
Don’t get me wrong, we are very happy with our house, and think overall an above average job was done. I’m sure there are many things our general contractor did that others would not. And again, I don’t mind paying extra for better service and product. This just strikes me as not quite up to par.
Sorry for the length of this post. In my business, I do my best to treat people fairly. I like to be treated the same way. I’m not sure I am and would like an impartial opinion. Thanks so much for your input.
Replies
Since this was built as "cost plus", is this just considered a continuation of the project and something I should have expected to pay for?
In some ways yes to answer your question but in others no. If your agreement allowed a clause for the builders mistakes to be his expense then he should pay. But if he was limited in the scope of work done by thebudget and your decisions, no.
Please, I'm no lawyer just a fellow contractor.
I try to address these issues with my clients up front before work begins. There are always call backs for one thing or another. I absorbed those cost where I know I or one of my people messed up but where issues or failures are due to choices made by the client then they pay.
No matter what I due though there will always be confusion when a cost plus agreement is used.
A bigger issue might be the heater and your concerns. I agree with those concerns, ceramic heater or not. Even tho they usually have a shut-off when tipped and a thermostat setting. I'm not sure that I wouldn't have put some kind of circulator on the water line, if one exist. Or install an outlet that has a timer limit.
Smarter minds than mine hear might have a better idea for you what is best.
Edited 2/13/2004 11:20:28 AM ET by JAGWAH
I have done many, many jobs where 'mechanical design' was not provided by the architect. They draw up a lot of other things (including a lot of stuff that can't be built as drawn and has to be trouble-shot or design-completed by the builder), but in my experience almost never show where the water heater is going and how large pieces of ductwork are going to somehow fit through small spaces.
Do the plans for the house show where the water heater should be? If so, and it's there now, then the responsibility is with the architect. If not, then you created and the builder tacitly accepted a liability regarding where it went and whether it worked there.
You did not pay a premium for your house, in my opinion. A 20% markup is very typical in the industry but a lot of experts will tell you that small custom residential construction businesses running at 20% are on the edge. The more successful builders I have known charge more that that, often by working on a fixed price and adding 30, 40, 50% or more whenever and wherever possible to protect themselves financially from situations like you describe, and maybe even afford their own seasonal second home too.
Since you bought on a cost-plus basis, you did not isolate yourself from the financial risks of the job. My feeling is that a builder in that situation should probably absorb his own stupid and incompetent mistakes (and go out of business if he makes many of them), but not items like problems with the finer details of mechanical engineering. Ultimately, it's your house and not his. Getting the water heater working right is a cost of the job and one that you should pay. That's my strong opinion and I'm sure other folks will feel otherwise.
You will have to pay some form of an energy bill related to keeping the heater warm. I might or might not use a dedicated heater in a confined space, depending on whether or not I felt it was safe and effective. I would almost certainly install it on some sort of thermostatic device so that it only ran when it was 32 or colder in the space, not all the time.
"Do the plans for the house show where the water heater should be? If so, and it's there now, then the responsibility is with the architect. If not, then you (the HO) created and the builder tacitly accepted a liability regarding where it went and whether it worked there."
It the placement of the WH was not specified on plans provided by the HO (and also not by an arch) then how did the HO creat the problem.
Specially when he questioned the builder about it and the profession said that it was OK.
And a very good question was this installed per the manufactures recommendation.
If this was desiged to installed on the outside of a building then either it is only in monderate climates and/or it specifies that the water lines be run directly through the wall from conditioned space. Not routed through a cold attic.
homey.... you didn't say where your hosue is located.. your climate would determine my concern over the location of your DWH.. generally.. i don't put appliances like those in hard to acess locations unless it's the only solution..
but your climate will determine the extent on my answer..
now .. as to your mehtod of contract... COST PLUS a PERCENTAGE..
if... (IF) all of his costs are in fact covered.. then 20% is ok.. most builders are not sophisticated enough to know how to recover all of their costs..
so.. if his labor rate for himself is high enough.. and the rate of his employees.. then the 20% will do..
if he's charging $25 / hr.. to you and then marking it up 20%.. he's probably going broke.. it all depends..
my costs for labor are the (rate x1.53) just to cover the payroll costs..
when we do COST PLUS.. our labor rate is $45/ hr for each employee.. and no markup .. then we charge all (materials + subs + equipment rental + fees & permits ) x 1.25..
so.. either you got a real good deal or you didn't ... as you can see, the 20% markup is meaningless.. since you didn' define what the costs were..
BTW.. i don't like to do COST PLUS work... it creates unhappy customers..Mike Smith Rhode Island : Design / Build / Repair / Restore
Nobody is perfect...........what's a couple hundred bucks between friends.
My worry would be the tight space confining of the heater.......then adding another heater and so on.............to me it all spells FIRE and I hate that word........I'da put the thing in the basement.........light bulb is a good idea on your part. Cubby holes are a good place to hide stuff, but not mechanicals IMO........
.Sounds like you have the loot.........put the whole works in the basement where it belongs.(if it's possible)
a few thoughts:
first of all, forget about the mark-up cost and the $120.00 and your hopes that your contractor will come forward and accept responsibility.
you have a problem. the heater and the pipes don't belong in the unheated space. the ceramic heater was a bad and a dangerous solution. whether the locating of the heater was the builder's or the plumber's idea doesn't really matter. they may have been thinking in your best interest at the time by trying to get you almost instant hot water by locating the heater so close to the faucet. for you, at this point, i would bet that you wouldn't really care if it took an extra 20 seconds to get hot water, just so your pipes don't break and your house doesn't burn to the ground.
my recommendation to you is to find a reputable plumber in the area through word of mouth. obviously, someone not affiliated with your builder would be preferred. show this person your problem and discuss a solution which involves relocating the heater and properly insulating the pipes. then offer to pay this person to do a casual inspection of the rest of the plumbing work in the house. you should be as fair, impartial and unemotional as you were in your post here.
what to do with the plumber's invoice ? that's up to you. yes, your builder made a mistake and in a perfect world he would own up to it and accept responsibility. if i were you, i would send him the plumber's invoice with a letter which tells him how happy you are with the finished product, yet you have this problem that you are hoping he will take care of. don't threaten him. if he never reimburses you, then let it go. our survival as builders requires you as the client to refer our next job.
carpenter in transition
I'm surprised no one has suggested heat tape for the pipes and heater. Wrap the exposed pipes and some portion of the heater with the tape, and connect it to a thermostat set to come on when the air temp reaches 35-40 degrees.
Whenever you are asked if you can do a job, tell'em "Certainly, I can!" Then get busy and find out how to do it. T. Roosevelt
The craftsman formerly known as elCid
This house is a year old. The water heater needs to be relocated. The heat tape is almost as worse as the ceramic heater!
The heat tape is almost as worse as the ceramic heater! Got to disagree on this. The tape is designed to keep pipes from freezing, and applies just the right amount of heat. When connected to a t-stat it will only come on when the temp gets low enough, and since it's fastened to the pipes there's no chance of it falling over and causing a fire.
If the decision is made (for whatever reason) to leave the heater and pipes where they are, then the tape is a reasonable idea. The ceramic heater is a bad idea. There are probably other good ideas as well.Whenever you are asked if you can do a job, tell'em "Certainly, I can!" Then get busy and find out how to do it. T. Roosevelt
The craftsman formerly known as elCid
I live in Maine and wouldnt think of installing the type of water heater you discribe outside, as we get below freezing weather for weeks at a time. you didnt say where your house is but you do get freezing weather , so it shouldnt be in the attic
As to whos fault it is I dont have an answer for you. If I asked the contractor will it be o.k. where he was installing it and he said it would then I would want it fixed .
Now you agreed on cost 20% and Materials. so in my opinion you already payed to have it installed in a place it would'nt freeze or be a problem. But do you have anything in writing as to everything being in good working order when the house is completed. if so youneed to talk to your contractor and give him the option of fixing it in a friendly way, and maybe you could be willing to negotiate a deal that you both could live with. Like maybe materials to install it in the house or basement and the cost of a plumber to be shared by both of you. also ask him what the cost was to install it in the attic in the first place and using that cost and the new cost you could see what the difference is.
And if he doesnt want to do it the easy way then tell him your not going to recomend him for any jobs and that your going to tell people how he does buisness.
The instructions for install of any water heater state must be install in an area where freezing won't happen. So tell/ask for the heater to be installed in the correct location!
homeowner,
first we're talking about $120.on a five hundred thousand dollar house,as a GC myself it wouldn't matter what my contract said, I wouldn't send you a bill for this.
Second,the water heater is in the wrong place,and should be moved.If it was spec'ed by the plans,I'd have talked you into moving it before the problem arose,you stated your concerns anyway, if my plumber and I missed this shame on us and we'll work out which one of us pays ,but not you.
Vince Carbone
I have put the steam unit for a steam shower in the attic many times. We remove the insulation in the ceiling underneath it, then build a plywood and styrofoam removable box over it. Enough heat from the building below escapes into the box that we have never had one freeze here in NY.
I agree with Vince, homeowner. Your contractor is a bum.
Get as well-prepared as you can be by talking to local plumbing contractors, and very importantly, your local building inspector.
Your home, whether for weekend use or full-time living, needs to be trouble-free in winter conditions. Any winter, even colder than this one.
A six-hour power outage on a cold, cold night can occur, and you cannot tolerate pipe freeze possibilities.
Where I am, no water supply lines can be in outside walls or cold attics, period. If you wanted an in-line water heater, he should have provided the mechanical space for it, inside your heating envelope. Not outside of it.
Have you told us where this house is built? Please do, so we can comment further.
Mr. Micro,
now I never said homeowner's GC was a bum.Homeowner himself say's he's happy with the rest of the house so this problem should be able to be worked out.Every one of us makes mistakes on projects, finding them and fixing them to everyone's satisfaction is what separates the men from the boys.Vince Carbone
Sorry, Vince. I said he is a bum, you didn't. And he is a bum, for doing what he did. We all make mistakes, but when we make them and then do a fix like he did, and charge for the fix, it puts a label on us.
Another thing that concerns me about having a gas-fired unit in the cold attic space, is the water that comes from condensate resulting from combustion. I lived with that once, and it was indeed a problem. The condensate outflow drain line froze routinely, when temps got low, and water backed up and came out, eventually ruining ceilings below. I cursed my plumber, long gone and out of business, for that one. This little inline heater, homeowner, should have been put into a small utility closet.
Good mechanical design and installation was part of your GC's accountability. Your job was to pay the bills, period. Get out of the way of finger-pointing, right now.
You should have it taken out and done right, or generously heat-tape everything, even the condensate outflow. Your GC should absorb all costs. Get talking to your local BBB and homebuilders association.
Well, I had lots of thought reading your original post and all the responses before mine. But a few things that haven't been mentioned bother me -
"I questioned a few things as the house was going up, but hated to be too persistent. Nothing worse to me than someone coming in to my business and telling me how I'm supposed to be doing things."
I don't like the sounds of this, at all. Are you saying you worked with this contractor, for about a year, on a 500k house, on a cost plus basis, and were tentative about voicing your concerns? That you didn't have regularly scheduled sit down meetings to discuss the project where you were encouraged to voice any and all concerns or questions?
"He brought his electrician, and they wired a new electric outlet in the attic and plugged in a ceramic heater."
I'd say $120.00 is way low to wire a new outlet, supply a ceramic heater, and take responsibility for the obvious liability issues from this work. Something isn't right here. Could be any number of things, like past dealings, or lack of professionalism in general, or careless business practices, but you would certainly have a better idea than anyone here.
"I mailed him the check ($120) along with a letter stating what I had done, and also asking what kind of warranty I might have for future "design flaws". So far no response."
I don't know what your personal communication style is, but that first sentence seems sarcastic - not good in a professional communication.
"In my business, I do my best to treat people fairly. I like to be treated the same way."
Would you like it if a customer had grievences with something you did, paid the bill anyway, didn't question you directly about concerns but used sarcasm instead, then asked strangers about the situation behind your back without giving you the courtesey of a sit down meeting to discuss these same issues? Would you consider that "treating people fairly"?
Because after all the sugar coating is stripped from your post, that's what you did.
This problem wasn't handled well after the fact, but the groundwork was laid for a less than satisfying business relationship long before that heater froze.
I see your point but maybe you don't see the one of a HO?
I am in a situation similar to that one. I had an utility closet in my plans and everyone involved, designers, builder and HVAC people, decided to hang the furnace in the attic, telling me "that is the way all houses are done today" and put the water heater in a closet in the storage room off the garage, both attached to the house, insulated but not heated.
They keep insuring me that it is ok but I wonder what will happen if the drains to the furnace don't work or has any condensation on it (ruined ceilings?) or the heater freezes where it is.
They are going ahead as they wish, even if it is my house and my money. How can I insist on them doing what I want when they are the ones that are so sure they know how to build houses? I have to resign myself to their advice, that is what I am paying them for, no?
I have two places in mind for that heater, in the pantry/utility room or in a hall closet by one bathroom, if it does freeze out there.;-)
Sometimes is hard to blame the HO for not speaking up any more than we do!
Wow, What a pile to dig into here!
My first thought is to ask what does the contract say about this sort of dispute resolution and warrantee work. My understanding is that in absence of lanquage to the contrary, an implied warrantee of serviceability exists and that the builder is responsible for making it work right.
The thing that really makes my mouth hang open in amazement is the ceramic heater. I challenge you find one on the market that has instreuctyions allowing for unattended long term use in a confiuned area. These things rank right up there with candles under the curtains, chimney fires, and summer lightning strikes for making headlines about houses burnt to the ground.
Welcome to the Taunton University of Knowledge FHB Campus at Breaktime. where ... Excellence is its own reward!
Ruby, if it's not too late, and if there is no code violation involved, send a letter to the GC and tell him to build it the way you want. Would he be upset if you unilaterally altered the payment schedule?
Whenever you are asked if you can do a job, tell'em "Certainly, I can!" Then get busy and find out how to do it. T. Roosevelt
The craftsman formerly known as elCid
It is too late to do anything since all that has been installed now.
What do I know about building anyway. It probably is ok. The GC gave a 10 year warranty on things like that being in the right place, not on failure of the furnace itself or such, that is under the manufacturer's warranty.
I was using it as an example on how little a HO can say and insist on and not be a pest and get everybody cross, demanding changes in such details where they really know better.
I insisted on plenty other features and we compromised on other. This matter I decided to wait and see. I have to pick my battles.;-)
The original poster does have a real problem on hand but that may explain why he didn't insist when he was doubting the placement in there. It is hard to do!
Ruby,
It is hard to do!
I'm listening to you... How can I, as a gc, make it easier for you to tell me wht you need. Because that's what you are talking about. Your needs for your home.
SamT
---" Because that's what you are talking about. Your needs for your home."---
Except that the GC builds about 30 homes a year, has 12 going right now and has been doing it for over 20 years.
If he thinks that is the best way to do things, that it frees room in the house envelope and the furnace is less noisy up there, even if it seems questionable to me thru common sense because the heater may freeze and the furnace may leak condensation water up there and I bring that up several times and my concern is dismissed as not valid, I have to defer to what he knows.
That the furnace and water heater be put where I think makes sense is not a "need", if my concern about the placement is not relevant.
Up to now they have done an excellent job in everything they have completed, even better than the norm, according to friends that are knowledgeable (seems that every able body around here for several nearby towns have been by to look at the house, that is big local news, even a 92 year old sweet, perky lady came by to give her approval<G>), so I have to quit worrying about what I don't know.
By the way, it is up to code here to hang furnaces in the attic, I checked (not checking on them, just intensely interested in this process and coming across much new fun information), with access no more than 20 feet from it and they did that right.;-)
I mentioned this because of the original poster's concern that did come to be.
I have a couple of comments regarding your situation. I am a builder in Pasadena, California, 99% of the work I do is cost plus percentage. Though we don't have freezes here, it is not difficult to imagine that unheated pipes in an unheated attic will freeze if the temperature drops below freezing long enough. Also, an unattended heater in a difficult access area is unnecessarily risky, REMOVE it immediately. Heat tape ought to work, but it is not a permanent (read appropriate solution). Sounds like someone did not understand the idea of an on demand water heater-that there is not a standing flame or a hot tank to recirculate from. Though your Contractor may not have been aware of this, his plumber should have been. If neither of them understood those premises before, they do now. So, legal considerations aside, the contractor and plumber should learn the lesson they should have known before and fix the job. It is fair for them to ask you to buy materials (plus mark up), as if they moved the heater before, you would have bought materials anyway. They should pick up the labor. In my opinion, that will get your job fixed, and keep them available and not hostile in case of future problems. Essentially
I don't know whether you are being treated fairly or not. Obviously this situation has not been handled well by the builder. He should come up with a permanent and safe solution to the problem and eat the cost. He should do this if for no other reason than to protect his reputation. Whether it is fair or not depends on the entire job, how complete the plans were, how changes were handled, and the relationship that you and the builder have established over the course of the project. We have no way of making a judgement on any of this.
I do know that we as GC's are often called upon to make design decisions about things that we know little about. These may involve new materials or products, building systems, or architectural features that are outside our past experience. Granted, we may know more about this than the homeowner, but given the complexity of most houses we are often making an educated guess and this holds true as much for most architectural designs as it does for the back of the napkin sketched designs. (Napkin designs tend to be simple.) We look over the situation, try to figure exactly what the customer is after, and then try to make it work. To a greater or lesser extent, we are building a one of a kind prototype. To expect that there won't be a glitch in this is unrealistic. The best that a good GC can do is to build this factor into the cost of the work so that you can afford to fix these mistakes without charging extra at the end of the job. This won't lower the cost to the customer (It may actually raise it.), but the customer will feel that they have been well treated instead of wondering what is fair.