Expert: Stephen Major (Owner--Major Design Group) - 6/13/2007

Question
After much research to find a reputable builder to do some remodeling, a family member signed an initial/first stage contract with a local builder.  The work covered by this contract was carried out (checking the footings and preparing the architectural drawings) and it was paid for in full.  

Now the builder has realized that a 5' by 14' space between an existing room and the addition was not taken into consideration in the estimate!!  He seems to have made an honest mistake, but is stating that the total cost for the renovation will be 50% more than originally stated.  Now for my questions.  

1.  This family does NOT want to abort the project at this point, but sacrificing many of the features in the original plan and doing the finish work themselves still won't bring the total cost within their budget.  

2.  How can the addition of 70 square feet (nothing but space, no plumbing or windows, etc.) add $30,000 dollars to a room addition?

Is there a "general rule" about cost increases due to errors on the part of the contractor?  In other words, shouldn't he, not the customer absorb such costs?

I realize these questions could be directed to a lawyer, but no one in this family wants to sue anyone, they just want to get the room built without pricing their home beyond the neighborhood value.

Thanks for your time.

Respectfully,
Nanci

Answer
Nanci,

It's possible that the builder began to realize that the job was more costly (to him) than he anticipated.  Not just the missing 70 sq. feet, but the job as a whole.  And this 5x14 discovery has given him the opportunity to correct his number.  Their best course is to re-bid the work with other contractors, and leave this one out of the bidding.  This assumes that he has not begun actual work at the site.

By the way, that number (30K) seems about double what it should be.  

It would be a mistake to try to force the contractor to do the work for the lower price.  The job would not go well.  It couldn't.  If the contractor is preparing architectural drawings, then he may carry "Errors and Omissions" insurance that they could sue against.  Honestly, I don't see  how anyone could draw scale blueprints without realizing the mistake at that time.

They should have a conference with a lawyer ASAP.  This does not mean that they are necessarily going to initiate a lawsuit, but they most certainly need precise legal advice at this time, so they can make the best possible decision.

--Steve Major