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Question DetailsAsked on 2/21/2018

my contractor is charging a 300% more than his quote. What can I do? He did not forewarn me of the additional cost

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3 Answers

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You say did not forewarn about the overrun - I am going to assume this means you did not agree to any additional work or changes to the scope of the original agreement. If there are things of those sort - which you agreed to (even verbally) or knowlingly saw being done and did not halt the work or installation, then you need to negotiate a fair price for those items, on a change order or contract amendment.


I am going to assume this is a significant amount of money involved - say thousands versus hundreds, which obviously would affect the effort you go to in fighting it, and in particular whether you bring an attorney into it or maybe try to handle it yourself in small claims court, for instance. Obviously, spending hundreds or thousands on an attorney makes no sense if the claim amount is small.


Now - about price increases without change or addition to scope of work, without any advance indication of these increases - for which he should have submitted a Change Order request for both parties dated signatures showing approval / concurrence, with scope change and cost on it - two versions of that story, though in both cases you certainly have the right to object to the cost and refuse to pay anything which is not fair to both parties, at a minimum.


Easiest one - if you had a firm price written contract (which might be in the form of a bid or proposal sheet which you signed, approving it), then he has to prove to you, to your satisfaction or negotiate something in between, that the cost increases are legitimate and that you should agree to them. Barring that, you do not have to pay, and him billing you for it again or filing a lien would be civil fraud and possibly criminal fraud.


If he provided you with an "estimate" up front, but no signed contract or firm contract price, then a grayer area - generally the courts hold an "estimate" can be adjusted up to maybe 10-25% from the estimate price, subject to submittal of documentation of both his original estimate (to prove what his estimated costs were) and the actual costs to him (invoices, timesheets, etc). You can of course argue those increases were not legitimate, but he is in a stronger position for being able to say "the actual effort or cost was more than I estimated" in that case. But 300% increase without any warning during the job - he is either a lousy estimator and poor businessman, or criminally trying to take advantage of you.


Given the percentage increase, I suspect the latter, and would contact an attorney experienced in residential construction / remodeling contracts and lien law. I emphasize lien law because if he files a lien against your house, that can ruin your credit rating and potentially cause acceleration (immediate payment demands) on even unrelated debts and loans - car, mortgage, student, credit card, store charge account, etc debts or loans, un "mutual default" clauses where a default on one debt is deemed a default on all others. [A crooked concept, but designed to protect creditors against people heading toward bankruptcy].


With that sort of increase in the billing, I would also contact the applicable Consumer Fraud division at the District Attorney's office or local police department, or maybe Elderly/Disabled fraud unit if they have one in your area. I would also check with state contractor licensing board whether he is required to be licensed (and probably insured and bonded too) under state law, and if he is actually so registered - if required to be (generally so except for interior finishes work and in some states even then) and was not, then in many or most states that is ample cause to refuse to pay him anything - and in some states it is a crime for him to accept any payments at all ofr work requiring licensing if he is not.


Here are a few similar or related questions on cost overruns with answers which might help too:


http://answers.angieslist.com/Can-I-c...

http://answers.angieslist.com/if-cont...


http://answers.angieslist.com/My-hand...


http://answers.angieslist.com/no-esti...


http://answers.angieslist.com/Should-...


http://answers.angieslist.com/I-gave-...

Answered 8 months ago by LCD

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(duplicate)

Answered 8 months ago by LCD

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Oops - failed in include this prior question link in the list in original answer:


http://answers.angieslist.com/Our-Gen...

Answered 8 months ago by LCD




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