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How common is it for a contractor to ask for more money at the end of a job?

6K views 36 replies 17 participants last post by  chrisn 
#1 ·
Neighbor had a deck built by the neighborhood handyman guy. He was working alone, took him about 3 weeks. I know he hit an underground drain pipe, so that took some extra time. I believe the initial labor quote was $2,000 (which seems pretty cheap to me). About the time the deck was wrapping up, he said it took longer than he planned and ran into some things, and wanted another $3K. I think they said they were going to split the difference with him, but I haven't had a chance to talk to them yet to get the rest of the story.

What is the right way to handle this, on both sides? Should the contractor let the homeowner know at the point when he 'runs out of hours for the money' or what?

Just took me by surprise. Wondered how common that was.
 
#7 · (Edited)
So...are you saying the "handyman" is a numb-nuts and missed it by 150%? Depending on what he may have run into a few dollars more than the original quote could be in order, but, a quote is a quote. Were there a lot of changes (during the job) on the part of the owner?

Decks are usually fairly straight-forward jobs. You can see the open work area, you can easily recognize and list the material needs, you can see what exactly is to be done.

What else is there to know I wonder. Do we have all of the facts?
 
#9 ·
Well, I'm not in any position to call anyone a numbnuts. :) I will need to find out the rest of the facts to find out which person is the numbnuts. I don't believe there were any changes on the part of the owner. Everything was in the yard before the job began.

How do you know how to build a deck if you don't know what parts you need to build a deck? No wonder it took him longer than he thought. I guess he had to try putting it together a few different ways before all the stuff fit together.
I meant to say the homeowner wouldn't know what to order. I believe the way it went down was that the homeowner was given a material list, ordered it, and had it delivered.

I was there helping him put together some Ikea patio furniture while the deck guy was finishing up, when I got a text that my daughter threw up everywhere...I'll have to get the rest of the story to find out I suppose.
 
#10 ·
It isn't unusual to have changes that result in cost escalation but an upstanding builder/contractor will STOP at the time a new need is recognized and apprise the owner of the necessary changes and costs thereof. To not do so and wait until a job is complete and then surprise the owner with a huge invoice for "extras" after the fact is kind of dirty pool.

Technically when a change that results in a cost increase is recognized a formal (or informal) "change-order" is written including additional costs and signed by both parties IF they are in agreement.

There is something wrong with a tradesman type guy that misses (even an estimate) by 150% when there are no significant changes or mid-job escalations to speak of.

BUYER BEWARE !!!
 
#11 ·
Got a picture of this deck? It would be interesting to see why it would have cost so much.
Only time I've had to stop work and redo the price was the lady had worked on the deck design for over a year (no joke) she changed where she wanted the hot tub twice while were building the deck.
The hot tub was to be sitting on a concrete slab and we had already formed it up.
Had 1/2 the decking on and decided to change it to composite.
Wanted railings, decided to go with stairs instead, then changed again to seating.
Made her sign change orders with prices on each one but she refuse to pay, her excuse was her husband had bought her daughter a new car and spent the money.
 
#12 ·
Unless you are superman with x-ray vision, there may be hidden problems. As soon as the hidden pipe was found, there should have been a conference between the contractor and the project owner. Some exploratory work may have been needed to determine what the pipe may have done to the project. Could the pipe still be in use or not in use? Does the pipe need to be buried deeper, if so would a pump be needed? All this should have decided before the project continues. If the pipe impacted the time and material on the job, an increase in cost is legtitimate and the homeowner needs to pay up. But, both parties should have talked about the increased cost. What rate does the "handyman" charge. Who pays to have a real plumber look at the pipe and deterimine what needs to be done? Who pays the plumber for his time and knowledge?
 
#19 ·
Whether or not a contractor is entitled to additional money at the end of a project is entirely a function of the way the contract is written. Unfortunately, homeowner contracts are often short form, rarely cover complex issues such as change orders adequately, and often do not even fully describe the scope of work.

Even in the commercial/industrial world I live in, disputes over extra compensation are common, in fact I can't remember a project I have worked on where there wasn't at least one request for extra compensation by the contractor. The difference between commercial projects and residential projects is that the contracts for commercial jobs are typically very thorough, are reviewed by an attorney on both sides, and are typically based on well developed model contracts where the meaning of all the words has been carefully thought out, the scope is usually pretty clear, and the commercial terms and conditions have been litigated to death, so both sides usually know pretty well what they are in for. Even so, disputes over costs are common.

There are many potential legitimate reasons why a commercial contractor may be entitled to extra money, even on a "fixed price" or lump sum contract. For example, if the Owner requests additional services, that is always grounds for extra compensation. If differing site conditions are encountered that requires extra time or materials, extra compensation is usually in order. If there is an increase in cost of commodities such as fuel or copper, that may be legitimate grounds for cost increase. Acts of God such as flood, fire, tornado, earthquake etc. that damage equipment or make the site inaccessible may be grounds for increased cost. Force Majeure (this means actions that impact a project beyond the control of the contractor such as a strike delaying shipment of equipment or materials) may be grounds for extra compensation. There are many other possible reasons for legitimate extra costs, for example defective plans, material shortage, defective specifications, inconsistency between plans and specs, and a variety of less common issues.

The point of all this is that without reading and understanding the contract, it is impossible to make any meaningful statement about whether a contractor is entitled to additional compensation on any project. The problem is made worse if the contract is incomplete, poorly worded, difficult to understand, or unusual.
 
#20 ·
I can sympathize with both sides on this. If I was to tell someone I would do the job for $2K then I would do it for that. If I take a savage beating then it is money (poorly) spent on education. If I was the home owner I would feel bad for the guy and may be tempted to give a little more. But in the end the neighborhood handyman screwed the pooch and needs to take his lumps.
 
#21 · (Edited)
You are dealing with a handyman, not necessarily a seasoned, licensed tradesman with business savy. The difference is with the latter the owner would have known what price changes they were in for before the last nail was hammered home and it was time to settle up. Each time something unexpected would have happened work would have stopped and not started again until new charges were agreed to. And a contract would have been signed at the onset saying home owner must eat any extra charges related to more labor and materials due to factors the builder could not have seen at the time of the estimate and which he could not be held responsible for.

With the former, well, you get what you paid for. Which is, a guy who hits a water line and underestimates his price by 150%.
 
#25 ·
all of my contracts...on plumbing, heating, remodeling, state any exrta cost to the contract labor or material will not be performed until a written order signed my me and the home owner is in place:thumbsup:
Well written contract.... goes back to the very basic... what was the agreement between the HO and the handyman.


(Incidentally, and of no consequence to the issue, that deck (from the pics) looked nicely constructed, maybe 20+ by 12+, and $5K labor, depending on design, materials list, and odds ends provided by handyman, seems a fair price)
 
#27 ·
Good chance the handyman was asked what an average deck would cost, and he shot them a number from a description they gave. Then when deciding on what they wanted their deck to look like, and how well constructed. The amount of work changed. And the handyman failed to let them know it was more work then they originally discussed. Perhaps even thought he might be able to do it in the same amount of labor hours.

Unfortunately, none of us were at the meeting when the price and time line was discussed, so we can only speculate.
 
#28 ·
my only problem with this case....did the handyman just spring it on the homeowner at the end of the job, with no discussion of extra cost during the install. most if not all of us would know when we are at the cost we bid a job at and if its going to run over...IF IT WILL RUN EXTRA...WE SHOULD DISSCUSS IT WITH HOMEOWNER...NO EXCUSES.... THAT IS A FAIR BUSINESS PRACTICE ...FOR THOSE WHO DON'T THINK SO...LOOK IT UP WITH THE BBB.:yes:
 
#30 ·
Always communicate with either the contractor or the home owner if your the contractor. I always talked with the HO if there is a problem that will increase cost. Failure to do that makes one a hack! and to put all the risk on the home owner with T&M makes one a hack. If you don't know how many man hours it will take to do the job and how much the materials will cost, and to do a T&M because of it shows the ineptness of the contractor.
 
#32 ·
Good questions and points you bring up...thanks for the education! I'll catch up with him next time I see him to find out some more details. I agree the deck looks pretty good from a distance; I haven't been up close on it to see the finish work. I did see it as a skeleton and it looks well built.

Even at the new price, they are well well ahead of what the builder offered -- about 10' x 10' all pressure-treated for $8K.
 
#33 ·
I say neither has any conscious. The HO knew they were getting a steal. The builder realized he underestimated and tried to get the HO to pay for his inexperience. I am actually on the builder's side. Been there. Eating the cost did not help my business, nor win the HO's loyalty.
This builder probably will not last long in his business unless he learns to ask.
 
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