My new website for thermal storage, listeroid, new house, off-grid power, etc.

[sailawayrb]

Wow, that is truly a frustrating and sad saga indeed.  

One doesn't often hear people use "good" and "contractor" in same sentence, but your experience sounds about as bad as one as ever I have heard. Thank you for sharing and for the good suggestions on things one might do to mitigate some of the risk.  

I wouldn't beat yourself up too much about it.  It is practically impossible to do as much on your own as one would prefer especially when you have a wife, young children, and an important/intensive full-time career like you have.  Sometimes in life you just have to "do your best" given your priorities, capture the "lessons learned" from your experiences, not dwell on past history or things you can't control, and just keep moving forward in a positive way...which I am certain you have done and will continue to do.

Bob B.

[mike90045]

Well, you know we just moved into our new house.   Our contractor gave us a estimate which is what the house loan from the bank was based on.....

YEOWWW !!

[Tom Reed]

I functioned as the general during my house building project. Also did a lot of the subcontractor jobs my self too. Fortunately, due to the nature of my business I was able to build the house during the day and work at night. I'm real glad the house is done! Unfortunately due to the economy the home is probably worth just under the $ spent on it.

[Horsepoor]

Generally, you can get a one-hour consultation with an attorney who specializes in construction law for around $300. Why not bring a copy of your contract with this contractor and get an opinion on your options? Then, when you know what the probabilities are of a successful outcome on your various options, you are in a better position to discuss his fees. From what I've seen, general contractors frequently use the same subcontractors. One would have to wonder if there are not kickbacks from these cost overruns. Given the large disparity of costs between your selection of subcontractors and his selections, I wonder if your general contractor has written records of competitive bids? In other words, did he even take the time to bid with anyone else or just call up "Buba" his buddy to do the work at any price so long as he gets his kickback. My heart goes out to you getting screwed like this.   

[Zero_G]

Hey Marcus,
     I just looked over your website and have to say that you surely have a beautiful place. It is obvious that you have put years of forethought into your design. Speaking as a do-it-yourselfer and former small-time building contractor, I am impressed by the amount of work that you did yourselves.
     I'm sorry that you had a bad experience with your contractor, and thanks for sharing it with us. I'm guessing that due to the remote location, your choices were limited. There is nothing that will make a GC happier than a cost-plus job of your scale. He gets to keep his favorite subs busy, there is no pressure to get it done quickly, and the profit is guaranteed.
     Anyway, I'm sure that the finished product will give you a lifetime of pleasure. And as my friend tells me, "It's only money, you can always make some more!"

Tom

[mbryner]

Generally, you can get a one-hour consultation with an attorney who specializes in construction law for around $300.

Yes, we've thought of that.   I still "owe" $26k from their "final" bill, which I just didn't pay yet.  

The only way I got any money from the bank for an off-grid home on 320 acres was to talk directly to the bank VP.   The national and even regional banks wouldn't give our project a second glance.   I got to be friends w/ the local bank VP through Rotary Club.   He and the bank pres. came out to the project during construction and were quite impressed.   They are the ones who are suggesting I get an attorney involved.   (The bank VP is an attorney but he won't say much of course.)   They have been very good to me, even extending me a $150k line of credit after the construction loan money ran out.

"It's only money, you can always make some more!"

Very true.  

We've tried all along to take the higher road and do the Christian thing.

[mobile_bob]

its time to play some hardball with your contractor,

i would set him down and make him justify every line item, after which i would explain to him what i would be
willing to give hi of the remaining twenty whatever thousand left oweing

in no uncertain terms i would explain to him that i would rather pay an atty twenty whatever thousand bucks to
cut his balls off than give him any more money, and if he didn't accept my final offer then that is exactly what i will do.

before you do this, go to the county courthouse and see what liens have been placed on the property, for all you know
there may be liens placed by unpaid sub contractors, material suppliers and god knows what!

your best bet, "before" you pay him any more, and before you meet with him is to check for liens, and then go see an atty
for a consultation, it might cost you a couple hundred bucks to have an atty take a look at what is going one, but my bet is it
would be the best money you have spent so far.

it pains me to say this, but i bet there are liens that are placed on the property that you aren't aware of, and if they are from unpaid
sub contractors that the GC was responsible for paying, or materiials that he was to pay for...guess what?  if you pay him he leaves
you on the hook to try and recover and make him pay the others so you can get the liens released.

this is business and it is ugly, ugly, ugly given the state of our economy

please don't pay this guy another dime before you have a lien search done, and before you get counsel.

on the up side it is a gorgeous place you have there.

bob g

[Jedon]

Wow this is so close to my experience, my numbers are all lower but exact same kind of thing.
We had to get a hard money loan which we now still have since the contractor was months behind schedule we lost our one chance to get a regular loan.
Now we are stuck with credit cards, unpaid subs, an interest only construction loan and a not quite finished house.
Oh well it is beautiful and an adventure, like was said, is just money and the pain will fade with the years. ( I hope!! )

[sailawayrb]

After studying OR construction lien law for several hours last night, here's a summary what I learned:

1. Contractor must provide "Information Notice About Construction Liens" written notice to owner on
or before any contract is signed.

2. Subcontractor(s) must provide "Notice of Right to Lien" written notice to owner within 8 business days
after starting labor.

3. If 1) and 2) are NOT accomplished or if contractor and subcontractor(s) were not licensed during the entire project, they will have very difficult time enforcing any future Lien action.

4. If 1) and 2) are accomplished, the owner can request statement of the contractual basis and charges incurred.  If contractor/subcontractor(s) don't respond within 15 business days, they may lose the right to claim any attorney fees/cost associated in any future lawsuit to foreclose on the Lien.  

Owners can further mitigate their Lien risk by issuing checks that are jointly payable to contractor AND subcontractor(s).  Owners should also ask every subcontractor(s) that provided a "Notice of Right to Lien" to provide a signed "Lien Waiver or Release" BEFORE making ANY payments to the contractor.

5. A Lien must be recorded by contractor or subcontractor(s) within 75 days of the last day labor was provided.

6. Within 20 days after a Lien is recorded, contractor or subcontractor(s) must provide "Claim of Lien" written notice to owner.  The owner can request statement of the contractual basis and charges incurred.  If contractor/subcontractor(s) don't respond within 5 calendar days, they may lose the right to claim any attorney fees/cost associated in any future lawsuit to foreclose on the Lien.

7. Within 120 days after filing a Lien, contractor or subcontractor(s) must initiate a Foreclosure Lawsuit or the Lien becomes invalid.

8. Contractor or subcontractor(s) must provide "Notice of Intent to Foreclose" written notice to owner and mortgagees no later than 10 days before beginning foreclosure action.

I hope this helps someone and perhaps fosters better understanding of Lien Law.  Again, this only applies to OR and Lien law varies significantly by state.  I am also NOT an attorney so one should definitely consult with an attorney for best advice on this subject.

Bob B.

[mobile_bob]

it looks like oregon has passed some laws protecting  consumers against goofball contractors

this was not always the case around here!

bet you can breathe easier knowing the rules of the game before hand

bob g

[sailawayrb]

it looks like oregon has passed some laws protecting  consumers against goofball contractors

this was not always the case around here!

bet you can breathe easier knowing the rules of the game before hand

bob g

Precisely...one always needs to fully understand "the rules" so one may use them to one's full advantage and break them as required knowing the full consequences...

Bob B.

[Jedon]

Good luck, our contractor broke all the rules but the law is by far on their side. The law doesn't stop them from filing a lawsuit to enforce their bogus liens where they didn't follow the rules and the judges seem to assume that owners are deadbeats who are ripping off contractors. Don't expect help from the state contractors board either. Just my bitter experience, your luck may vary.

[mobile_bob]

i remember when i took on the ground to sky rehab of the victorian monster back in the early 90's
the only bank in the state (security pacific, which got bought out by sea first which was a horrible problem) had a special
department for rehab loans on homes of historic interest

the rep was a great source of info, mostly in matters of contract law and helped me avoid what might have turned out to be disasters

i learned early on, find a real estate atty, and have him look over all documents
i found one that would look over anything for a flat fee ranging from 50-150 bucks and make the needed changes to keep me protected

i might have spent 500 bucks total with him, and it was the best money i ever spent.

between the two guys (atty and banker) i learned all the ways contractors can screw you up, sometimes without meaning to.
sometimes they can just get into financial trouble on another job, not pay a supplier and the supplier will put liens on every project
that contractor is associated with,, and you often won't know about those until it is time to close the deal or apply for conventional financing.

its best to keep a close i on everything, from knowing who the suppliers are, who the subs are, and checking periodically with everyone to see that everyone is paying their bills.

i had one general contractor that i had advanced 2/3rd the money to reroof the place, only to find his subs were all guys from the rescue mission, and two of which had never been paid anything and had not eaten in 3 days!  these are guys working 75ft above the street level
on a 12/12 pitch roof, resheeting in the rain without safety harnesses of any kind!

yes i fired the general contractor on the spot, he told me he would sue, i told him to go ahead i would love to eat his lunch in court. i then paid off his rescue mission help in cash on the spot so they could go get something to eat.

hired another pair of contractors, had to fire them too, then another that though he knew better than me on what i wanted done, fired him too
and finally the 4th contractor got the job done.. luckily no material liens because i had bought and paid for all the materials.

i still get nauseated from the memories of one of those first guys visibly shaking , because he had not eaten in days, and working on slick plywood in the rain... yes there is a God and he had to have had guardian angels all over that roof that day, an another one looking after my best interests too.

if i ever do build again, i will certainly be my own general contractor, and will be really involved with every aspect of the project.

bob g

[quinnf]

in no uncertain terms i would explain to him that i would rather pay an atty twenty whatever thousand bucks to
cut his balls off than give him any more money, and if he didn't accept my final offer then that is exactly what i will do.

I had to do that with a deadbeat lawyer once.  My new lawyer said not to be specific about what recourse I might take because to do so could be taken as an attempt at extortion.*  When Lawyer 1 ignored three registered letters, each saying the same thing, then received another one from the State Bar, he knew what my recourse was.

My advice: Contractors live and breathe stuff like this every day. They know what they can get away with and what they can't.  Don't negotiate with your contractor before you get advice from a lawyer that specializes in Real Estate and/or contracts.  A small investment in legal advice can save you grief down the road.

Quinn

* Extortion.  n.  The obtaining of property from another induced by wrongful use of actual or threatened force, violence, or fear, or under color of official right.

[mbryner]

Nice to know there are others out there who had contractor troubles, too.   We're on vacation in Switzerland visiting family and friends (planned a year ago and bought w/ FF miles) so I'll have to deal w/ it when we get back.

BTW admin, thanks for finally getting rid of that Spencer guy.

Marcus