AboutPeter M. Elliott Expertise First response to queries regarding extensions of time, variations orders, site instructions and payment using FIDIC and other forms of Conditions of Contract, based on English Law, and derivatives only.
Experience Value . . .
It's unwise to pay too much, but it's unwise to pay too little. When you pay too much you lose a little money, that is all. When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing you bought it to do.
The common law of business balance prohibits paying a little and getting a lot. It can't be done. If you deal with the lowest bidder, it's well to add something for the risk you run.
And if you do that, you will have enough to pay for something better.
. . . John Ruskin (1819 - 1900)
"We are too poor to buy something cheap"
.Romanian Proverb 2002
A lean compromise is better than a fat lawsuit.
George Herbert (English poet 1593-1633)
I said it in Hebrew, I said it in Dutch,
I said it in German and Greek:
But I wholly forgot (and it vexes me much)
That English is what you speak!" Hunting of the Snark - Lewis Caroll
Match your presentation to the reader!
The joy of food lasts but an hour, of sleep but a day, of a woman, but a month, but the joy of a building lasts a lifetime. Syrian proverb.
Comments and observations leading to improvements in the translation of FIDIC Red & Yellow books into Romanian prior to approval by FIDIC (reference 'Preface to the Romanian edition')
Question I am in Michigan and building a new house. I got a quote for the roofing on my home and chose that company because of their quote. Now that the roof is on they are charging me almost double because they made a mistake and miscalculated the size of the roof and the amount of shingle needed. The quote I got was not on a per anything basis, but a quote for shingling the roof on that particular home. Can I hold them to the quoted price? Is the quote considered a 'firm' price or is there an allowance for varriation? They are talking about placing a lien on the home.
Answer Hi Lisa,
The first thing to do is to take the threat of a lien seriously. Do a search on the web for information on 'mechanic's lien'. There are lots of sites, both federal and commercial, so you can learn the moves and countermoves. You could lose your home if you do not respond correctly.
Pay the agreed amount and get a receipt. If the contractor will not accept the agreed amount, put it into an escrow account or pay it into the court if he does apply a lien. This action means that you are not refusing to pay his invoice merely that you disagree about the amount. If the court decides in his favour, then your liability for any costs is reduced. Your lawyer will advise on the exact procedures.
Everyone is responsible for their own mistakes, especially an experienced businessman. If the mistake was genuine, he will not be in business for long. Assuming that you have written evidence of the original price, there is little chance that the builder can force you to pay him more money, unless the contract allows it. Some contracts are known as 'remeasurable', which means that you remeasure the work after it is finished and calculate the price based on unit rates. Was their price very much lower than the competition? Was it obvious that they had made mistake in the quotation? Did you query the quotation? Have a word with your local trading standards officer, better business bureau, citizens advice bureau, other clients, anyone to see if this company has done this trick before. Did he deliberately drop the price to win the business? In which case, tough! A contract is a contract.
If his price was really low compared to others and the quality of product was really good, you may wish to offer him an ex gratia 5% or 10% completion bonus to go away and leave you in peace, with encouragement not to make the same mistake in future. Depends on whether or not you think that the mistake was genuine.
