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contractor change order - please help

Posted by admiral (My Page) on
Wed, Sep 11, 13 at 19:04

Hi all, we have had some serious problems with contractors low-balling us in the past. We are doing a gut remodel of a new home, and just started work with a new contractor on a large project.

I'm so frustrated and amazed by the rampant dishonesty and incompetence we've experienced so far that I'm not sure if I'm being reasonable, paranoid, or have completely lost my mind.

The demolition line item for our 1200 sqft 2br/1ba unit (taking everything down to bare studs including flooring, all cabinetry, appliances and fixtures, all drywall, and removal of several interior stud partition walls) was ~$10k line item in our proposal. This was inline with other bids we received.

Now demo is nearly complete, and the contractor is saying a big change order will be necessary, ~$5k - $7k.

The reason?

"90% of interior wall finish was not sheetrock, as assumed in the bid, but was plaster and lathe, which takes more time to demo, and incurs larger dump fees because of heavier weight".

This is in San Francisco fwiw, where I expect dump fees are exorbitant compared to most places.

This reeks to me. In truth, ~60% of the wall surfaces were plaster and lathe. Patches of the plaster and lathe were exposed during walkthroughs, so if it's so much more expensive, you'd think the contractors would be on the lookout for it.

I can't imagine this is legitimate, it would imply that demo of everything (floors, stud walls, windows) expect for plaster and lathe is extremely cheap.

How you can help:
• Do you have experience/expertise with demo, and have an informed opinion as to whether this is an unreasonable change order?

• Do you know of other online resources/forums I can check where I could ask a community of contractors about this?

• What would you do, is it even worth trying to fight back on this CO, or is this a big enough red flag that you'd jump ship now?

I feel so beaten down. We've been burned so much, and are trying so hard to do due diligence in selecting contractors. I was really hoping this new contractor would help us turn a page - great reviews on angie's list and yelp, a 20yr license record, detailed bid with reasonable prices (not too cheap, not too $$).

I don't know if I'm trying to fool myself into believing this CO is ok because I can't take any more of this, or if I'm so raw that I'm being overly sensitive.

Sincerely appreciate any help you can provide.


Follow-Up Postings:

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RE: contractor change order - please help

I've never heard of a change work order being implemented after the fact. But, I know I've haven't heard it all.

The moment additional charges would be occurred, you should have been notified.

It is normal for additional charges for unforeseen elements, however, this should be spelled out in your contract.

What is the wording in your contract?


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RE: contractor change order - please help

thanks Roof,

We've only been billed 85% of the original contract budget item. Demo isn't complete, but most of the offending Plaster and Lathe has been taken out.

Change orders for unforeseen elements was specifically called out in the contract with standard language around needing sign-off from both owner and builder.

I'm more curious as to whether there is any merit to this change order, rather than inconsistencies in its timing. I'd understand a few hundred bucks in extra dump fees even though the contractor could have, should have, and probably did see some of the wall surfaces were plaster and lathe. But $5k at a 50% increase over the entire demo cost?


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RE: contractor change order - please help

The same amount of cubic yardage can obviously weigh different amounts depending on what that debris is composed of. A tile floor would be heavier than a wood floor by a factor of at least 5. 10 if the tile was in a old fashioned mud bed.

It's the same with drywall vs. plaster. Plaster IS very heavy. 70% plaster can be 90% heavier than drywall. This is one of those changes that unless you informed the contractor that the unit was mostly plaster and lathe rather than drywall, there was no real way to know. Just having a couple of exposed areas isn't enough to be able to accurately calculate the amount of weight that the debris will be. More weight is more costly fees.

Someone has to pay those additional fees. Who pays those fees will depend on how your contract is structured. If it's a completely fixed fee, then the contractor will absorb the overage. But based on the contractor's comments, that doesn't seem to be the case. It sounds like there is a "hidden issues" clause that allows him to charge more if he finds something that wasn't apparent upon the initial inspection. Plaster and lath vs. drywall would certainly qualify to have a change order processed for the additional weight.

Or, if this is a mini time and materials contract within the fixed fee, then you pay the time and materials cost of this particular aspect of the job and the rest is the fixed fee.

Or, if it's a total time and materials contract, then you will pay the difference, as well as any other future overages that occur. In older buildings that can have a large amount of hidden issues, most contractors will ONLY approach the job on a time and materials basis.

We can't see your contract, and you haven't told us which type you signed. But, you need to read that contract, as it governs the situation. I'm assuming that you had an attorney vet the contract before you signed it considering it's going to be such a large expense? And I'm assuming that your contractor will be able to present you with the dump slips listing the weight, plus account for the additional man hours that the more difficult demo used?


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RE: contractor change order - please help

One would say there is two ways or more to view the situation.

If the contract is generic without specifying the material to be taken off the walls, the contractor should have noticed during the walk through, 90% of the material was plaster & lathe. The other 10% would be a bonus for them, the removal wasn't as time consuming for removal or clean-up. The dump fees(weight)would surely jump for plaster lathe.

I couldn't even imagine someone doing a walk through, without a couple knocks on the walls.

If the contract does indeed specify " everything taken down to bare studs, etc, etc". Plaster/lathe would/could be construed as part as "everything". On the same token, "drywall" is spelled out in the clause.

You can only be held liable by the four corners of the contract, same goes for the contractor. It's not like the wall surface was hidden. Personally, if the wording of "everything" is indeed in the contract, I would expect no extra charge for plaster/lathe.

The job might have entailed more labor than expected, but that is noway your fault since a walk through was done.


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RE: contractor change order - please help

I wish I could help, but everything I know about building goes out the window in San Francisco. PVC is against code; they still require cast iron. Rodent control requirements turn crawl spaces into concrete swimming pools. Property line set backs can be nonexistent or change half a dozen times in one city block. Garage slabs are poured over wood framing. It's one of the greatest, most influential, iconic and beautiful cities on the planet, but I'd hate to be a general contractor there.


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RE: contractor change order - please help

A proper contract would requIre a change order to be priced and accepted by the Owner before work proceeded. The work was probably performed by a sub that did not visit the site. That should not be your responsibility. You should demand an explanation from the GC. Good luck.


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RE: contractor change order - please help

thanks Roof,

We've only been billed 85% of the original contract budget item. Demo isn't complete, but most of the offending Plaster and Lathe has been taken out.

Change orders for unforeseen elements was specifically called out in the contract with standard language around needing sign-off from both owner and builder.

I'm more curious as to whether there is any merit to this change order, rather than inconsistencies in its timing. I'd understand a few hundred bucks in extra dump fees even though the contractor could have, should have, and probably did see some of the wall surfaces were plaster and lathe. But $5k at a 50% increase over the entire demo cost?


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RE: contractor change order - please help

Thanks very much everyone - just to clarify a few things:

• The contractor claimed 90% of covering was plaster, and only 10% drywall. This isn't true - a little less than 60% was plaster.

• The building is 110+ years old, and there were several exposed patches of plaster as well as exposed patches of newer drywall before starting.

• The contract has an unforeseen condition stipulation.

• The contract language is to 'remove all interior wall, ceiling, and floor finishes'.

• He clearly should have noticed and accounted for the plaster walls in the walk through. If he didn't, I might be willing to accommodate an honest mistake.

For the sake of argument we give him the unforeseen condition clause, give him fact that the unknown plaster requires a change order - what's a reasonable range of estimates for the size of the change order?


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RE: contractor change order - please help

1st. There is no mention of a detailed plan and
specifications.

"90% of interior wall finish was not sheetrock, as assumed in the bid, but was plaster and lathe, which takes more time to demo, and incurs larger dump fees because of heavier weight"."

Remind him that he walked the job and not an estimator, made notes and had the opportunity to measure.

Contractors do not budget for the lesser contingency.

Call the waste site, landfill or transfer station and ask if they had a recent fee increase, if and how contractors and waste haulers are notified.
Ask if the contractor or if he employs a licensed hauler, have a current account.
Obtain verifiable lein releases for any person, place or thing that showed up and/or provided a service on the contractors behalf, for your property, before releasing any funds.

"great reviews on angie's list and yelp, "

Are you serious?

If he persists and you relent, good luck.


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RE: contractor change order - please help

If the contractor inspected the premises before demo, and was allowed to knock holes wherever he needed to (because it was all going to be demo'd) then it would seem that the underestimating the job would be on him, because the conditions weren't "hidden".

If there were only a few holes in the wall, and the room was furnished, and there was no opportunity to do more exploratory surgery, then that can qualify as hidden conditions that would require a change order. Since it looks like he is in the middle of the job, he's doing exactly what he should do. He's discovered conditions that need to have a change order, and he's put out a change order for you to approve.

It's awfully early in the process for such a large change order, and it's an awfully expensive change order. But, you are in one of the most expensive locations in the country, with not a lot of land to be able to serve as landfill. So, if he can show you where the additional costs come from for his off the cuff number, then it can perhaps be justified.

The only for sure thing that we can say is that we're not there in person, and haven't read your contract, so there are no hard and fast, "he's right" or "she's right" judgments to be made over the internet. If you feel that this is a harbinger of things to come, or even just to clarify things to yourself, make an appointment with your lawyer to discuss things. And perhaps be willing to pay for a construction consultant to give you an opinion of the job overall, and the progress so far. A retired homebuilder or contractor who serves to inspect older homes might be someone to sound some ideas off of in person after they've taken a look at the conditions.


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RE: contractor change order - please help

This isn't very helpful of me, but if you can get out of doing the rest of your job with this guy, I recommend it. Anyone who thinks a 110 year old building is all drywall is not likely to be worth a poop when it comes to working on a 110 year old building.


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RE: contractor change order - please help

I would ask for a copy of the invoice from the disposal company as well as an accounting of the extra labor that was required. Demoing plaster and lathe does take more time than drywall (did they take haz mat precautions for it due to possible lead/asbestos content? That would add time and difficulty to the process.)

For frame of reference, we were going to be charged about $1200 extra in labor to remove plaster/lathe in a stairwell, the only part of our remodel that didn't have drywall. We opted to demo that ourselves.

Also for frame of reference -- I'm in Seattle, so not sure how the costs compare, but here are some numbers. Our 30 yard dumpster got emptied 13 times, at $120 a pop just for changing out the dumpster for a fresh one, plus a fuel recovery fee of $23 each time. We had two types of loads that went out -- dirt was by the yard (we had a basement partially dug out) and other debris was by the ton. It was $89 per yard or per ton. Aside from dirt, we had about 60 tons of material hauled away, which included drywall, wood framing members that couldn't be reused, some rock, plaster, lathe, pipes, garbage, tiles, old vinyl siding, a set of stairs, cedar siding that was not usable, and lots of chunks of concrete. Reusable stuff (windows, shower stall, bath vanity) got listed on Craigslist. This was from a 1400 sq. ft basement which was about 50% finished, including the floor (half the basement had only dirt and rock floor, the other half had a poor quality slab we had demolished so we could pour a whole new slab). Some smaller loads of debris were taken out by the contractor themselves, and I don't have a separate accounting of that.

So -- are the charges legit? They might well be, but your contractor did not handle this well. Change orders should be agreed to in writing before the work is done, although in our case we had a comfortable relationship with the contractor and we were able to OK things verbally or via email and deal with the actual signatures later -- but before any work happened, it was discussed and a price was given so I could make an informed decision.

Even if this is a legitimate expense and couldn't have been avoided, this is a good time to push back and put them on notice that they can't screw up the communication like that again. I would let them know that it was not acceptable that they sprang this on you -- if the increase in cost is really due to it being plaster/lathe instead of drywall, they should have known as soon as they started demolition that a big change order would be necessary and they should have warned you at that point.

Ask for the paperwork backing up the increase in fees/labor. Unless you are bound by something in the contract that requires you to approve change orders within a certain amount of time, hold onto it and put off signing it until you near the end of the project (assuming you decide it is legit). That should help keep them on their toes (this is a tactic I stole from Amy Johnson's invaluable book, What Your Contractor Can't Tell You -- which you should have a copy of! See link below.)

Hope that helps as something to compare to. Good luck with the rest of your remodel. I hope you included wine in your budget for those days when you need it!

Here is a link that might be useful: What Your Contractor Can't Tell You


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RE: contractor change order - please help

I've worked in every neighborhood in san francisco. Everything is assumed to be plaster, unless the building was already gutted from a previous remodel and drywall was used.

There is no merit to this change order. If this guy is really in the business of demolition in San Francisco, he conned you into a low-ball bid by "assuming 90% was drywall" I always assume everything is plaster, unless there is evidence that drywall was used in the original construction. Almost all residences in San Fran were built prior to the 1950's, when drywall was first introduced. The contractor was foolish, or dishonest, to call the job a drywall demolition job. Either way, it's his fault.

Any job I look at, I ask the owner what year the house was originally built. From that little bit of information, many unknowns can be assumed with a high degree of accuracy.


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RE: contractor change order - please help

I also assume the plaster contains asbestos, unless there is testing to prove otherwise.


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RE: contractor change order - please help

" demolitionlab"

Down here in the "nanny" state. it's about 4x as much.


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RE: contractor change order - please help

"Assuming" the makeup of the walls, when they're in plain view, is not an unforeseen condition. Unforeseen conditions are the things behind the walls that they encounter. If it were me, I'd tell him it's his own mistake (or stupidity) if he mis-bid it, and he'll need to eat any extra cost. And since you say his bid wasn't low, I wouldn't be surprised if he bid it assuming plaster and is just telling you that he didn't to squeeze some more money out of you.

As some due diligence, you might call a couple of the other bidders on your job and ask them if they bid it as plaster or drywall. If they say something like, "of course it's plaster, everything in SF of that vintage is" then that bolsters your case--and your confidence--in dealing with this guy.

You could also call a dumpster rental company and find out what their dumpster rental and dump fees are. Where I live (small town, midwest, so no comparison to SF), we rent a 30 yard dumpster and each time we dump it, they charge us $250 to dump it plus $35/ton. Our weight is usually 3-4 tons each dump. So the bulk of the fee is for the truck to come haul it, and doubling the weight has very little impact on the total cost. SF costs will obviously vary, but if the pricing structure is like ours, plaster vs. drywall wouldn't increase it that much.


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RE: contractor change order - please help

Thanks very much everyone - just to clarify a few things:

• The contractor claimed 90% of covering was plaster, and only 10% drywall. This isn't true - a little less than 60% was plaster.

• The building is 110+ years old, and there were several exposed patches of plaster as well as exposed patches of newer drywall before starting.

• The contract has an unforeseen condition stipulation.

• The contract language is to 'remove all interior wall, ceiling, and floor finishes'.

• He clearly should have noticed and accounted for the plaster walls in the walk through. If he didn't, I might be willing to accommodate an honest mistake.

For the sake of argument we give him the unforeseen condition clause, give him fact that the unknown plaster requires a change order - what's a reasonable range of estimates for the size of the change order?


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RE: contractor change order - please help

You are not taking this seriously enough. This guy screwed up, and may have contaminated your house with lead and asbestos. Now he is really barking up the wrong tree, trying to con you out of more $. The change order is not reasonable at all. Here are the reasons:

1. Any competent demolition contractor must be capable of identifying potentially hazardous materials. The main ones are Lead and Asbestos. Before any work begins, all potentially hazardous materials must be tested, or if not tested, assumed to contain the hazardous material and handled accordingly.

2. Because he did not identify the plaster as such, he is incompetent in his job. Was the paint tested for lead? Was any plaster or drywall tested for asbestos? Even if it was, and came back negative, the number of samples required to establish the negative test results would have needed to come from multiple rooms, multiple locations. Proper sampling would have led him to a more accurate assumption of how much plaster vs. drywall he was going to encounter.

3. In reality, it is unlikely that the contractor even sampled for lead or asbestos. This is the smoking gun. He disturbed hazardous materials and exposed his workers, the public, and contaminated your house with lead and asbestos dust. I would threaten to sue him for potential damages, unless he can provide 100% negative test results. I would also threaten to call the EPA and OSHA to report his incompetence and negligence.

This guy has no clue about how much trouble he could get into by going this route. He really should not be doing demolition in San Francisco without Lead and asbestos certifications. This guy should lose his license.

Do not pay him even the remainder of the original contract.


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RE: contractor change order - please help

" The contractor claimed 90% of covering was plaster, and only 10% drywall. This isn't true - a little less than 60% was plaster."

Did he also claim the moon was made from green cheese?

Sounds like his 20yrs. of exp. was in devising methods of purposefully structuring "change order" contracts.

"The building is 110+ years old, and there were several exposed patches of plaster as well as exposed patches of newer drywall before starting."

And is SCREAMING plaster, lead and asbestos.

"The contract has an unforeseen condition stipulation."

WHAT IS UNFORESEEN IN BARE WALLS AND CEILINGS?

The contract language is to 'remove all interior wall, ceiling, and floor finishes'.

"I might be willing to accommodate an honest mistake."

REALY! Did you take him to raise?And when you make a financial mistake, like you are about to do, who makes up the monies you've lost?

"what's a reasonable range of estimates for the size of the change order?"

Not a farthing, until all of the permits, abatement certificates and inspection are completed, an invoice is presented accompanied by lien releases from anyone and everyone who provided labor and/or material for the address.

You need to tell him, in writing, that you wish to suspend his operations at the address, until the issue is resolved.

There is none so blind, as those who won't see.


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RE: contractor change order - please help

Wow, I totally missed the abatement issue. Very good point! I should've thought about that very issue right off the bat.

I just went through that with my own place since I had the exterior painted, and the house is pre-1978. Anyways, the painting contractor was a certified lead free contractor and did an evaluation/assessment before proceeding with a quote.


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