Construction Problem: What Would You Do? - REO Property Preservation Forum
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post #1 of 11 (permalink) Old 03-14-2015, 09:51 PM Thread Starter
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Construction Problem: What Would You Do?

This is not a P&P type problem BUT I know I will get an honest opinion from forum members

Scenario: Fire damaged home. I represent the homeowner for their content claim. The insurance adjuster did a great job on the estimate for the dwelling repairs so I was not needed or so I thought. A Preferred Vendor for the Insurance Company began repairs without a signed contract from the homeowner ( to the extent of $70,000)....

The scope of work included REPLACEMENT of ALL metal siding and house wrap. When at the home last Wed the siding company was there and I was making small talk (homeowner was not there) when they stated they were only replacing 2 elevations of siding AND I noticed the house wrap had not been replaced.

Later at the homeowners rental home I pointed out that all the siding and house wrap had been paid for on the approved scope of work AND the check was already endorsed but not sent to mortgage company yet. The homeowners and I went to the home after our meeting and I showed them the old wrap was still on the home and only 4 strips of siding was left before the 2 elevations were completed. When rubbing my hand over the wrap my hand came back covered in soot. Thus the reason it was to be replaced.

Also, the incorrect front door was installed (a cheap metal exterior 6 panel door), homeowner told they could pick out $4000 worth of cabinets when they were reimbursed $9600 and R11 insulation was installed instead of R13 per code.

Now the GC is telling them it wasn't supposed to be replaced when they know better. Since the homeowners have not signed the contract they want to pay the GC for the correctly completed work and they want my company, that has done many fire rebuilds, to finish this off.

I have mixed feelings. This GC has lost trust of the homeowner. I was thinking about calling a meeting with the GC (without homeowner present) at the home and point out the deficiencies and let them "man-up" and make corrections. I'm afraid they will feel embarrassed and cash out on the project... Then I'm stuck rebuilding.

What would you do?????

Where you at P3+?

Last edited by Wannabe; 03-14-2015 at 09:53 PM. Reason: Spelling
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post #2 of 11 (permalink) Old 03-14-2015, 10:09 PM
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I'm assuming you are there as the public adjuster. If so, I would advise not to get involved with the rebuild. However, I'd also throw that GC under the bus, back over him two or three times and then squeal the tires right on top them. This smells like fraud. The homeowner is not receiving the rebuild they should.

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post #3 of 11 (permalink) Old 03-14-2015, 10:14 PM Thread Starter
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Actually not the PA on the dwelling. I sure could be but wouldn't be if I was doing the rebuild even though it is perfectly legal with disclosure forms. Still a conflict of interest in my opinion....

I just hate to stand by and see what is happening to the homeowner
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post #4 of 11 (permalink) Old 03-14-2015, 10:43 PM
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Inform HO. Tell them to get an attorney. Walk away. I don't see how you benefit at all.
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post #5 of 11 (permalink) Old 03-14-2015, 11:57 PM
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Sounds lke gc is trying to screw homeowner at every corner. Your idea sounds like the standup thing to do. Why would you be on the hook to rebuild if gc bails?
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post #6 of 11 (permalink) Old 03-15-2015, 02:54 AM
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When working in the real world, a contract is everything. The fact this company opted to start work without getting a signature was their undoing. I'm also surprised the homeowner wasn't privy to their allowables nor understood the scope. I'll make a guess and say you are there as a friend/favor so there is no conflict of interest. I've looked out for older folks and single moms in the past when asked in similar situations. If that is the case, and the HO has lost faith in the contractor, I'd advise sending them to the curb. If they are trying to pad their margins by skimming the client thru shortcuts and "contractor grade' materials, I wouldn't want them in the house. When he told them they had a 4k cabinet budget when they actually had a 10k, he is either ignorant or lying. At that point, gotta go. This ain't a toilet job with the local Leroy on a Tuesday morning. The GC should be paid the minimum for completed work, nothing more and thankful they got that.
It is much more common for the honest contractor to work a job without a signed contract on the honor system and then get a screwjob; sounds like this time it was the other way around. FYI, I have a longtime sub I use on building and rehabs that to this day, submits every bid and contract for my sig.
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post #7 of 11 (permalink) Old 03-15-2015, 10:13 AM
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I just mediated a total loss fire rebuild - there was a one page contract for that entire demo/build - a 350k job that was worth 225k.

There was no disclosure of any line item costs like we call out in a draw sheet. The homeowner had no idea what his "budget" was for cabinets, framing, concrete etc....

A major mistake in the foundation was made and corrected - no disclosure of how or who paid for the mistake - I will bet that it came out of another line item budget... Shoddy workmanship through out, major items not done to plans (the plans did not call out detail such as trim, door type or cabinets).

The insurance company, well the adjuster, flat out didn't care - they authorized 351k, and that's what they were going to spend, whether it went in the builders pocket or materials, it didn't matter.

What I seen was fraud in every sense. The people that end up losing are you and I with higher rates - the homeowner for sure, he's stuck with a 50% higher than needed homeowners insurance bill and a 25-30% higher than needed property tax bill, and a poorly constructed home........

As an honest business owner that provides quality work at higher than average prices, I'm beginning to think the only way up is thru fraud and deception.
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post #8 of 11 (permalink) Old 03-15-2015, 10:31 AM
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Never been in Themis exact scenario but I would help the Home Owners get what they are supposed to be getting. It sounds like the contractor is cutting corners to make money. The home owner has all of the power here. They need to demand things be done correctly.
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post #9 of 11 (permalink) Old 03-15-2015, 10:57 AM
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If that's what you found with a cursory look, just imagine what other corners were cut.

Ill bet the homeowners were/are overwhelmed.. A fire, loss of personal stuff, the feeling of safety, insurance adjusters, GC's,
having to stay with family or a hotel, kids all that stuff. They don't know what they are looking at they just know this guy is a "professional" and recommended by the insurance folks who are helping them get their life somewhat back to normalcy.
IMHO Id toss that jerk under the bus...

I don't really know if Id do the work. I might offer to consult as a favor.. but that's it.

Im all for making a few extra bucks to support hubbys "look at the shiny new truck gotta have it" fund. But never at the expense of someone else..
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post #10 of 11 (permalink) Old 03-15-2015, 11:06 AM
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look,,,,,if it aint right, IT AINT RIGHT !!!! the whole point of the rebuild is to give the HO there home back, not for some scammer acting like a GC to make money. like CL hack said the HO needs to demand it be done properly, also at some point (sooner than later) this "GC" needs to be reported to any and every agency possible

EDIT: not saying the GC shouldn't make any money, just an honest amount that reflects the quality of work
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