I have a customer who is making some unreasonable requests for change orders. Our written agreement states that I’m to install all new doors throughout the house (among other things as well). The customer has decided that they don’t want some of the new doors installed, and for me to return the doors I special ordered and to not order any new doors. My contract specifies that it is a fixed price contract and NOT a time and materials contract. I worry that if I go through with the change order, the customer *could* have an argument for my breach of contract.
One the other hand, if I play hardass and don’t deviate from the contract at all, the customer could get vengeful, withhold money, and put me a financial bind. Right now, I’m tempted to seek the advice of an attorney, but would like input from my peers before things have to get ugly.
Replies
" I worry that if I go through with the change order, the customer *could* have an argument for my breach of contract"
I don't see that.
The change order becomes a modification of the contract. Plain and simple.
Just get it signed and the appropriate adjustments in price, schedule and scope.
Might make it clear in change order about any return charges (if appropriate) or if they can't be that they are the customers and he can do what he wants with them.
I never deviate on special orders. If they don't want them installed, that's fine, but they still get to pay for them. I still have about six doors in my shop - "in storage" that customers have paid for but decided niot to install.
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I thnk this example illustrates why a "special order" clause should be included in a remodeling contract. Additionally, when someone decides to "special order" something, they should pay in full. If paying in full upfront is cumbersome, then they should at least sign a special form that again clearly explains the special order policy and clearly explains that they will still have to pay in full if they don't install it. Obviously, they would receive some sort of labor credit, if appropriate.
blueJust because you can, doesn't mean you should!
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If paying in full upfront is cumbersome, then they should at least sign a special form that again clearly explains the special order policy and clearly explains that they will still have to pay in full if they don't install it.
I will extrapolate on this point ............
Do NOT, EVER invest your hard earned money in others homes or assets.
You should at the very least be getting paid as you go along.
Special order materials are to be paid for up front, or COD and it should always be made very clear that the client owns the materials at that point.
What they wish to do with them is up to them.
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Bill is correct about the change order. Piffin is correct about the special order. Unless you can return the unused doors for a refund (and with a fee to you for doing so), he owns them. Whether he wants to install them is up to him, but they're still his.
Include in your change order the change to your fixed price reflected by the doors you're not installing, and it must be signed by the HO.
It sounds like you're not comfortable with the job and don't trust the HO at all. So figure it out now, as it isn't going to get better when you've done more work and don't get paid. If you're going to have a problem getting paid, have it before you've done all the work.
SHG
I got a sizable deposit up front, and I'm not "in the hole" right now. None of my hard earned money has been advanced toward this job. Paperwork has been completed and conversations have been documented.
The customer has a "friend" that thinks he knows how houses are built because his father built houses 40 years ago. The customer tends to believe the last thing he heard, and his requests for change orders are given to me sometimes twice a day by his friend.
The doors have been a major sticking point with this project, and have cost me lots of time waiting on the customer to make up his mind. This type of behavior has been repeated in several other facets of this project. It took me three weeks just to get them to pick out the faucets and lights. I need those to finish the bathroom.
Basically, I need to get a rein on these requests because the paperwork is going to become a mess if they go much further.
given to me sometimes twice a day by his friend. Is his friend authorized to sign change orders?I'm sorry, I thought you wanted it done the right way.
"Is his friend authorized to sign change orders?"
Absolutely not. I have to chuckle and roll my eyes everytime I hear from the friend. Some of the things they are requesting are nothing short of surreal.
I'd just tell their friend to get the hell off my jobsite and shove his ideas up his a$$.
That'll pretty much put ya where ya wanna be.
Out in the cold ... but firmly back into your initial contract.
and I'm not kidding!
It's my job site dammit ... they get their house back when I'm done. Till them ...
my rules.
I'm pretty sure I'd be polite the first coupla times ... after that ... he'd not be coming back with any great ideas. I had to tell remind one customer I didn't "sign the contract" with "her father" ... reminded them I had a clause that stated "site tours by contractor only" ... and said he wasn't invited. Either pay me to stay ... or pay me to leave ... but if he came back I was closing up shop. I finished in peace ... they hated me ... but I got paid. Win some ... lose some. But get paid when U lose.
Jeff
Buck Construction
Artistry in Carpentry
Pgh, PA
"Basically, I need to get a rein on these requests because the paperwork is going to become a mess if they go much further"
I don't understand this statement. Change orders in writing are your best friend. No reason for it to be a mess. I have run jobs with 75 change orders and if they are tracked appropriately you (1) provide lots of service to your customer, which they appreciate, and (2) make a lot of extra money.
Every change order has at least a half-dozen important things on it.
(1) the change order number and the date.
(2) description of the extra work, in detail, including copies of any changes to the plans, specs for any new items, etc. etc. Very detailed!
(3) the dollar amount of the extra work.
(4) the new dollar amount of the entire contract including all previous changes and this one.
(5) a statement of when this new amount will be paid (sometimes right now as others are saying) and a copy of the modified written payment schedule.
(6) the number of days that the change will add to the overall job, and the cumulative number of days added by previous changes, plus a copy of the written schedule if you are using one.
(7) the owner's signature(s) and date, your signature.
It's also good to provide clients with a contract audit every time there's a change... this shows the dates and amounts of all previous payments and change orders, remaining amount due, etc.
If you handle paperwork correctly the owner will realize that you are entirely on top of running the job. Fail to do so and.... you're not.
Jeff is right about the friend... beat him about the head and neck with a piece of foamboard.
Paperwork paperwork paperwork.
Make sure you get it all written down and signed.
As SHGLaw says, if there is going to be a problem, it's better that the problem be right now, rather than after you have done more work.
And oh yeah, did I mention... paperwork !!
The person you offend today, may have been your best friend tomorrow
It is easy to be friends with someone you always agree with.
Why are change orders unreasonable?
Give your customer what they want just let them know what it is gonna cost. If you can't give them an exact price rough it out for em.
Is this customer bothering you in other ways?
Being suspicious or nervous can be a self fullfilling problem. If you start getting nervous or angry that can cause problems.
Good advice here. All of my special orders are paid for in advance before they are "special ordered."
Whatever you do, just make sure you get it in writing.
I have a problem right now with a customer that owes me for what was basically a verbal agreement for extra labor (I know, I know). This guy would come on site spec a bunch of additions to the job say "do it like it was your own house, I gotta go".
Now he calls me back.
A cabinet that was back ordered 6 mos. finally came in and he wants me to put it in. No mention of the outstanding balance. I see alot more talking than installing on monday.