Contractor stole our money and abandoned project

12 Replies

I hired a insured, licensed, bonded general contractor to remodel the bottom unit of our building. According to our contract, he was to be paid in phases until the completion of work. He kept collecting advance payments (saying he needs to buy materials and pay for subcontractors). In addition, he keeps request additional charges for "change orders" that are not signed by us. It appears that he has been making mistakes and is using "change orders" to get us to pay for his errors. Currently, we have already paid for the entire amount in the original bid, and about half of these "change order" additional charges. Only 50% of the project has been completed. The remodel was supposed to be done in 2 months, so far it has already been 5 months.

On Friday, he requested another "change order" additional charge, which we finally disagreed with. He then said he will not work until this gets paid and proceeded not to show up. I feel totally taken advantage of. I plan to file a complaint with the license board Monday and file a claim against his bond. Is there anything I should do? I'm worried he will say I fired him, also worried he will file a lien. 

Updated 4 months ago

I don't even know if the "change orders" are actually considered change orders because we did not tell him to change anything. He kept sending us bills for additional costs, which we kept paying in hopes of ending this project.

@Kristy F.  

Change orders during construction is very common because in many instances things that were not accounted for in the original scope do pop up and when you start opening walls, demoing, etc many surprises can arise. Usually the contractor will communicate with the home owner and explain all these changes and get approval FIRST before it actually gets done. I would look at your contract with the contractor to see if there is any clause or details regarding change orders. Also, I would look at your original scope and compare with his change order invoice to see if any of the them items are the same or billed twice. Lastly, I would speak to the contractor and try to negotiate a better rate for the change order especially if he never explained to you what and why the change order was done without approval. I'm not sure the licensing board can do much. I think it's more of a civil issue.

@Kristy F.

You took the time to draw up the contract and draw schedule and then don’t follow it? If you had stuck to the contract you would have forced negotiations and not have been out the money which would be a stronger position. Look for a new contractor.  Consider the loss -tuition. Get one recommended by the BP community

When you paid the contractor you agreed to any and all change orders and additional costs. You can not now expect any money back. Hold the line on refusing the new change order, turn this information over to our lawyer to prepare for the worst and move forward with a new contractor to complete the work.

This is now simply a cost overrun associated with renovation estimates.

A good lesson is to never sign off on a change order unless it has been discussed, shown to you, and you and he agree it is extra and the price is reasonable. Contractors deserve to be paid for extra work that wasn't carried or unforeseen, however the investor/homeowner needs to be made aware of the extra before work is done, pricing determined and all parties in agreement.

@Kristy F. Sorry to hear about your situation. Do you have any pictures? Even though you didn't sign, were the change orders documented beforehand? I will send him registered mail with a notarized letter asking when are they going to show up again. This way, you can have some sort of documentation that you didnt fire him. I've heard of these type of situations and the second contractor is more expensive than the first, so be prepared for the cost difference. If I think of anything else, I will circle back. Good Luck... L

i know of a contractor that always bids low . He has a nice 30 foot boat , its name is  " Contract"  Now he puts that boat up on his 150 ft yacht . The name of the yacht is  "Change Order " 

@Jack V. Ospina The portion on our contract about change orders says: "Extra work and change orders become part of the contract once the order is prepared in writing and signed by the parties prior to the commencement of any work covered by the new change order." 

The only thing we signed is the original contract. 

@Carl Fischer We didn't follow the draw schedule because of these change orders/additional costs. He would do something, then tell us a week later that this thing costed how much extra and that we needed to pay in order to proceed. Pulled this on us several times. 

@Thomas S. But he hasn't completed all the items in the original contract and some of the things in these additional work/change orders. Can I get money back for work not done?

@Lee 

@Lee Lockhart I have lots of pictures and videos. The change order would be verbally told to us. When we ask him how much, he would stall for a week on telling us the cost. During this week, he would quickly do the work. Then he would give us a written number that we feel obligated to pay to move on with the project. However, these change orders/additional costs were not signed by him or us. 

We have already sent him an email asking him to respond and if he is coming back. He has not responded to that or our phone calls. Should I send a certified letter as well? I planned on filing a complaint with the board on Monday. Do I need to wait and give him more time to respond? At this point, I don't trust him going forward and want to find a new contractor. I do want my money back for work that is not completed though.

@Matthew Paul Sigh, our contractor showed me pictures of his Porsche sports car, told us how in 2015 he made over $1 million. Back then I just thought he was good and successful... Now I know!

How much money are you talking about to finish?

@Carl Fischer I haven't gotten any professional bids for the remaining job. I'm guessing at least $30,000, maybe $40,000.

@Kristy F. I agree with @Carl Fischer that should follow your contract and schedule to ensure work progress and payment stays on track. If the contractor has disappeared on you, you could try to find the contractor and inform them that you are hiring an attorney. Maybe you get him to refund the money or get some work out of it. Hiring an attorney and trying to collect would likely be difficult and expensive. Good luck.

@Kristy F. I had a similar situation a couple of years back with a contractor. To make things more sticky, he was a family friend of my business partner (who had originally hired him). He refused to continue the work when we challenged him.

We ended up hiring another contractor to finish the job. As @Carl Fischer said, it was tuition! We barely broke even on that flip, mostly because it ended up taking more than 6 months than originally planned. 

Either grin and bare it, or move on. Hiring a lawyer to sort it out will be more costly, and time consuming.

That’s a significant amount but not as bad in San Fran as the rest of the country. I would spend the effort finding another contractor and get it done. Carrying costs are a deal killer. Sorry for your experience. 

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