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Why Builders Don't Like To Price Cash Payout Offers

A builder dropped into my office to kick himself and share what had happened to him.

His friend, another builder introduces him to a client because the job is too big for him to take on. The client says he needs help to assemble a price to present to the Insurer so he can get the repairs done. A previous scope put the repairs at $650k but no one trusts the insurer’s scope.

So our good guy builder organises and completes a detailed repair scope that puts the repair at $1.2m. After months of fob-offs and denials by the builder finds out through a third party that the client settled with the Insurer. For nearly the $1.2m amount he estimate, and the client then sold the property ‘as is where is.’

There appears to be a pre-meditated aspect to this that is yet to be confirmed. He now tries to invoice the client (an accountant from out of town) but gets a “no way Jose” response with lots of legal terms in the letter. 

Can Anything Be Done?

Possibly, if he can establish a clear path of intention and go to court demanding settlement amounts as evidence of undertakings he may be able to prove that a contract was in place and the result was frustrated by the client’s actions.

I am amazed over the last  year how many builders I have talked to who have solved difficult earthquake claims issues and never got paid a cent. One had spent two years part time helping a very big job be resolved, yes two years and it was awarded to an Auckland firm. The information they put out to tender had all come from his efforts. In case you are wondering, these builders were all long term well versed and should have known better guys. They were seduced by the recognition of their expertise from others, but they never said "Stop! I want to be paid."

What Should You Learn?

For goodness sake get a contract saying who does what for what purposes! Stop working for nothing. The engineers, architects, and lawyers get paid to resolve these jobs. So why shouldn't you? Don’t repeat these guys’ mistakes. If you are engaged to provide solutions then damn well charge the fair amount for arriving at the result.

  1. Ask for help, and we can certainly assist
  2. Ask for mediation or negotiating services and you will gain the knowledge of their position in the process

How can ASQS help?

We can help you protect yourself and get the deserved rewards for your hard work. For a free, no obligation discussion for advice or service, call us or email us:

  • +64 3 281 7703
  • Lester@asqs.co.nz

We will assist in anyway we can.