Building a New House-Change Orders Huge Problem

Samantha80October 15, 2013

We are building a house & have a good part of it done-framing, windows, rough, electrical, roof. Rec'd $35 K in change orders and all but a couple of minor ones are due to changes contractor made. Our contract states that contractor must put change orders in writing but did not. He promises to going forward. Might have made other decisions if we had been told in advance. What does one do? We do not want work to stop, this will add delay and add'l cost and must pay invoices as they arrive. Can the sum be paid now and disputed at the end?
Contractor says there is nothing to negotiate. Want him to act positively so work will continue to be of good quality. We are in a very difficult position. We think the contractor underbid and is making up for the difference in this way.
Anyone had similar experience and how did you proceed or resolve?Thanks

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You probably have to give a hint of what these change orders are, for someone to judge.

If change order is due to some cost builder will incur: like due to fancy moldings, adding bathroom in the basement, or bogus fees - moving light from left to right, "documenting" choice of tile, different color of paint in the room, change to different type of 5" baseboards, installing different hardwood flooring (we had contractor claiming 3k extra for installing 5" hardwood vs 3").

    Bookmark   October 15, 2013 at 8:12PM
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Were any of these changes initiated by you? My builder doesn't charge for changes he makes and we have to sign off on anything that deviates from the plan. We started clearing today and these types of posts give me the willies as they could be in my future.

    Bookmark   October 15, 2013 at 10:03PM
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How can the GC make change orders on his own and then charge you for it???? Doesn't make any sense at all. You might need to get a *&*%$& lawyer involved. 35k is ALLOT of money.

    Bookmark   October 15, 2013 at 10:16PM
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That is a lot of money. Why don't you get all the details, in writing, and tell the GC you just need to wrap your head around it. Then find an attorney to review stat.

    Bookmark   October 15, 2013 at 10:36PM
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Sophie Wheeler

What type of contract do you have? A fixed price? Or a cost plus? It's sounding like you have a cost plus, and you are being charged the actual cost of the construction plus the builder's fee.

    Bookmark   October 15, 2013 at 10:37PM
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If you agreed to the changes without asking what they would cost, then I think you're stuck paying for them.

If you didn't agree, then that's something else.

    Bookmark   October 15, 2013 at 10:46PM
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I think if the GC requested the changes, he should say why and what the cost is without being asked. However, its better to over discuss things as it seems there is some joint liability in your case. He should've told, you should've asked yada yada yada. Again, good luck and keep us posted.

    Bookmark   October 16, 2013 at 6:09PM
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A change order changes the Lump Sum or the Guaranteed Maximum Price of a contract due to a change in the scope of the work. A change order can be initiated by the Owner or the Contractor in writing but it should be priced and approved by the Owner before the work is done.

Is your contract a standard one or did the contractor write it? If it was professionally written you should be adequately protected from surprise change orders.

    Bookmark   October 17, 2013 at 5:04AM
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