Question about this contract

[AzVoltage]

Hello all! I am new member to this forum, however I have lurked for a while and appreciate all the information I have learned from this place. I am an electrical contractor in Arizona, working mostly in the Phoenix metro area. I have been a contractor for a few years, and rarely have problems with contracts or customers.

If anyone can help me out with this one, I would really appreciate it!

I had a man call me for a bid on a new SES to replace this sixty year old system that was on this 1946 home. He wanted to get the utility to hook up to a home he had just purchased on an online auction. Utility would not hook up to the existing setup. Obviously, the system was outdated, not up to code, and upon seeing it my thought was, "wow, this thing is old!".

So I gave him a bid to do a replacement with a 200 amp meter/panel. I asked him if he was remodeling the home and was getting permits in addition to this electric work. He said no, he was just replacing some cabinets and repairing drywall and no permit was going to be obtained for this work...so this was NOT a home remodel. So, I took his word on this and realized the home's electric system would be grandfathered in and since no work was going to be taking place on the inside I would replace the service and hook up his circuits, get inspected, and get his electric back on. I also sold him some GFIs for the new counter tops he was going to install in his kitchen.

I showed up to meet the owner and he had modified my contract I emailed him for review. He added that if I missed anything on this job that the inspector would require, I would be responsible for the labor and materials for the work. I thought it was wrong he modified my contract but also felt that I know all the codes as I have done many panel changeouts before and covered all my bases.

While working at his home on his panel, all sorts of contractors started appearing. Knocking out walls, building fences, tearing off the roof, demolishing the carport and rebuilding it. All this was no permitting from any agency. I called the owner and asked him what was going on. He said he is simply repairing things and needed no permits..this was not a home remodel.

The next day I called for my inspection. The city of Phoenix inspector came out and his first words to me were, "What is going on here!". I said to him I was the electrician hired to do the panel and I don't have any idea who all these contractors were and I just wanted him to inspect my work.

To make the rest of the story short- the inspector stopped all those contractors and said this was a home REMODEL and all work needed permits. He asked me if anything in the homes' electric was out of code, and I told him it ALL was. He said, well this is a home remodel and it will all need to be replaced.

Again, when I took this job it was NOT a home remodel and I bid it to do the panel. Remember the clause that "anything inspector wants that I failed to perform would be my responsibility". This contract was signed before any permits for remodel and before any other work had started. I even called the city to make sure this was not a home remodel and they said that no permits were taken out....leaving me comfortable to think that I would be the only work and would get my inspection on the panel and the rest of the home would be grandfathered in...old or not.

The customer is telling me that my contract states I am responsible to get the electric on...and am responsible for whatever the inspector wants.

Am I going to be forced to rewire a whole house for the price of a panel changeout?

 

[CopperTone]

doesn't your contract state that you are just upgrading the service? so any language added to following the code would be in respect to the service upgrade and not anything else in the house? In Massachusetts - you generally will have an inspection for the service upgrade separately from any house remodel. Why won't the inspector sign off on the service upgrade and treat any other issues separately?

Sounds like the HO is trying to be sneaky but you need to stand firm - an inspector can't require you as the electrician to rewire a house for free because you upgraded the service - it would then be the responsibility of the HO. The inspector should sign off on the service upgrade and then put something in writing to the HO about condemning the rest of the wiring in the house. I've had a few inspectors actually help me out by putting something in writing to a HO which resulted in us getting more work which was extra. Have the inspector approve the service upgrade in writing and specify that the rest of the house is a separate issue that has to be dealt with.

I'm guessing the HO doesn't want to pay you either? get the letter from the inspector and then threaten the HO with legal action or file a lien on the property.

 

[AzVoltage]

Coppertone, thanks for the reply. My contract has no verbage to indicate anything along the lines of "anything required to pass the entire home's electric system is the responsibility of the EC." My contract stated number by number exactly what I was going to do. (i.e. panel, gfi's, dryer outlet). I stated that all work performed would be done to local and NEC codes. When I met the owner he had added a line that reads specifically,

"If any of the work done by EC is found by Utility and City inspectors not to pass inspection it shall be the responsibility of the EC for parts and labor to effect repairs in a timely manner. This shall also include any repair or replacement, not in this work order, which is found not to meet the inspector's code requirements."

I took this as any work I performed within or outside of this contract (such as any future work order changes or repairs I conducted on my own to get the job done) would be covered by me if not within code. I did NOT take this as anything that needs to be done to the house to meet inspectors requirements!!

I looked online at the inspection report for MY permit which was only for the 200 amp upgrade. It states, "inspector left notice at site that all work being performed must obtain permits including the new carport being built, Total interior remodel permits, possible complete rewire, heating cooling, etc etc." FAIL.

I had just had the utility come out and inspect the panel. They passed it and said they would hook up as soon as they see the city's green sticker on the panel. I was to call the utility as soon as the inspector passed the panel to schedule the lineman crew. Well, of course, with no pass the electric did not get hooked up. I asked the inspector when the electric can be cleared for hookup. He stated the home was not livable (no cooling, heating, no water heater, no smoke alarms, and possibly the entire electric would need to be replaced as they were knocking out walls inside) so he is deeming this home a complete remodel and will require it be brought up to code now.

I immediately called the homeowner with the bad news and he simply told me that the clause that I would perform the replacement of whatever inspector needs sticks!

 

[jmsbrush]

I,m still sitting here, wondering why in the world you would let some one change your contract. A contract is to protect you.

I would do what Coppertone suggest. I hope you have a good attorney as well.
It sounds like the remodel is hear say.

Welcome to the forum and please keep us informed on what happens.

 

[TxShocker]

"If any of the work done by EC is found by Utility and City inspectors not to pass inspection it shall be the responsibility of the EC for parts and labor to effect repairs in a timely manner. This shall also include any repair or replacement, not in this work order, which is found not to meet the inspector's code requirements."

I would let him read this part(I am assuming you did not do any of the work that did not pass), then tell him to pay up.And hopefully you never do work for him again.

 

[satcom]

If he changed your contract, that is a legal thing, a you might want to have your lawyer advise you, telling the inspector nothing was up to code, was not a good idea, it is best not to comment on anything not related to your contract.

One other thing you may want to consider is I bet you din't check to see if thet home was an online auction home, the utilities, may of been off for longer then a year, in that case the inspection agency and utility will not restore power until the entire home is checked and certified or they may require it be updated to current code, the owner may of already been aware of this, and this is why he changed the contract, sounds like you need legal advice.

 

[macmikeman]

I would have just walked away when those other guys started showing up to do remodel work, but you are now in deeper than that cause the city knows about it and officially considers you a primary target at this point. So here is the deal: You have been defrauded. Simple. Write a letter to the building dept. with the pertenant facts, and request your permit is cancelled due to fraud on the owner's part. Kiss your time and material goodbye. Walk away. If the owner sue's you then get an attorney. You will win the case due to the fraud.

 

[RH1]

You encountered a smooth operator. In the future you need to be smoother.

 

[Bob Kraemer]

RUN do not walk to your attorney's office.
The owner knew what he was doing when he added that clause in your contract.

 

[ITO]

"If any of the work done by EC is found by Utility and City inspectors not to pass inspection it shall be the responsibility of the EC for parts and labor to effect repairs in a timely manner. This shall also include any repair or replacement, not in this work order, which is found not to meet the inspector's code requirements."

You have been had. He wrote this in there so if he got caught, he could hook you for the work for free. Not to rub salt in the wound but I cant imagine why you would agree to that.

Contract modifications happen all the time, you just have to read them and remove the gotchas.

You may need to consult a vulture to see how bad he has you, it can be read several ways, what's to say that does not apply to the plumbing too it is pretty vague, but no matter how you read it, this may cost you some money.

 

[aline]

"If any of the work done by EC is found by Utility and City inspectors not to pass inspection it shall be the responsibility of the EC for parts and labor to effect repairs in a timely manner. This shall also include any repair or replacement, not in this work order, which is found not to meet the inspector's code requirements."

I read this to mean that you are only responsible for work done by you.
This includes any repair or replacement done by you that's not included in the work order.
It does not say this includes repairs or replacement of work done by others.
You are not responsible for work done by others in my opinion.

I would point this out to him and if that doesn't work I'd would have my lawyer review the contract.

 

[TxShocker]

I read this to mean that you are only responsible for work done by you.
This includes any repair or replacement done by you that's not included in the work order.
It does not say this includes repairs or replacement of work done by others.
You are not responsible for work done by others in my opinion.

I would point this out to him and if that doesn't work I'd would have my lawyer review the contract.

Thats what I was saying too!!!!!!!! Now stop thinking about it.

 

[growler]

"If any of the work done by EC is found by Utility and City inspectors not to pass inspection it shall be the responsibility of the EC for parts and labor to effect repairs in a timely manner. This shall also include any repair or replacement, not in this work order, which is found not to meet the inspector's code requirements."

I took this as any work I performed within or outside of this contract (such as any future work order changes or repairs I conducted on my own to get the job done) would be covered by me if not within code. I did NOT take this as anything that needs to be done to the house to meet inspectors requirements!! /quote]

I normally don't like lawyers but I do believe I would be talking to one about right now and have him review the legal verbage of the contract.

It really doesn't matter what you think or what the owner thinks the contract says but what is actually stated in the contract.

There is no way I would ever sign a contract with such open language..

Those alterations to the contact don't sound very specific and may not be valid but I'm not a lawyer so I'm not sure. This owner may just think that he is smarter than he really is.

 

[Power Tech]

I would have just walked away when those other guys started showing up to do remodel work, but you are now in deeper than that cause the city knows about it and officially considers you a primary target at this point. So here is the deal: You have been defrauded. Simple. Write a letter to the building dept. with the pertenant facts, and request your permit is cancelled due to fraud on the owner's part. Kiss your time and material goodbye. Walk away. If the owner sue's you then get an attorney. You will win the case due to the fraud.

I am with you, get the contract rescinded. Threaten him with a fraud lawsuit and recover any material you can. Let the BD know what he did and.....

On second thought I would tell him I was going to rescind the permit, get a lawyer and sue him for fraud.

Then ask him if he wants to start over and stop this nonsense?

If he wants to play hardball, drop the gloves.

 

[LarryFine]

I took this as any work I performed within or outside of this contract (such as any future work order changes or repairs I conducted on my own to get the job done) would be covered by me if not within code. I did NOT take this as anything that needs to be done to the house to meet inspectors requirements!!

That would be my stance, that it's an ambiguity, and the writer of a contract is usually ruled against in such an instance.

I would argue that he should be held responsible for the ambiguity as writer of the change, and he should be ruled against.

 

[LarryFine]

I am with you, get the contract rescinded. Threaten him with a fraud lawsuit and recover any material you can. Let the BD know what he did and.....

On second thought I would tell him I was going to rescind the permit, get a lawyer and sue him for fraud.

Then ask him if he wants to start over and stop this nonsense?

If he wants to play hardball, drop the gloves.

Absolutely! I suggest you check with your lawyer first, just to make sure your threat isn't hollow.

 

[nakulak]

how much work have you done ? I would tell him he lied to you and you are no longer interested in doing the work, cya. take plenty of pictures before you leave and get a nice signed statement from the building official after explaining to him how you have been had.

 

[AzVoltage]

Thanks everyone for the input. Its great to be able to consult with my peers on an issue such as this one.

I have put a call in to the inspector today upon the department opening. However, the inspector has the day off today and should call me tomorrow. I asked the department if I could set up a meeting with the inspector to discuss issues, and I was told he was in the field all the time, never in the office, and he only meets on the jobsites. I will wait to hear back from him and ask him at that time about meeting...

I have not talked with the owner since Friday. His quick answer when I told him more would have to be done than what we are doing...tells me he was not surprised about bringing the house up to complete code. It WAS AN ONLINE auction. He won this in August and tried to have the power turned back on. He told me the utility wanted the meter / panelboard SES replaced so that is what I bid on.

I think his intention in the paragraph he added "If any of the work done by EC is found by Utility and City inspectors not to pass inspection it shall be the responsibility of the EC for parts and labor to effect repairs in a timely manner. This shall also include any repair or replacement, not in this work order, which is found not to meet the inspector's code requirements."

The more I read it I read it as the repair or replacement indicates work performed by me. Now if it had read "any repair or replacement required to bring the home up to code" I think I would be in deep doo doo. But it was inserted in the same paragraph covering ensureing MY work was conforming to code. At the time this was presented to me, I had my contract and copy for him all ready to go. He pulls out of his car this new contract with the added paragraph. I read it and took it as, "my work will meet code, whether work I do on this list or anything else I touch in the home".

Again, I have not talked to homeower today. I am going to pull materials off the job that I have not installed. Upon hearing from the homeowner, I will let him know a new contract will need to be signed for any future work. If his attitude is still where I am responsible for work for no additional money or contract, then I will cancel the permit. By him having the illegal work being done on his home without permits (except for mine) and having submitted no plans to the city for a home remodel, I think his dishonesty shows and if he took this to Court it would be obvious his intentions.

I will keep you all up to date. Thanks again!

 

[220/221]

PM me the address and I will go over there and kick his ass.

Dude, you gots to be more smarter than that :roll:

Even as a youngster I would have seen that one coming. I'd consider yanking the service and pulling out. Let him take you to court (he won't)

Give it one last shot with the inspector. Tell him your permit is for the service upgrade only. They don't require us to upgrade anything other than the service, bonding and grounding.

One other thought. Request a temp service. Remove all branch circuits and install a GFCI wp recep under the panel. That will get the power turned on and (maybe) get you paid.

 

[ceb58]

"If any of the work done by EC is found by Utility and City inspectors not to pass inspection it shall be the responsibility of the EC for parts and labor to effect repairs in a timely manner. This shall also include any repair or replacement, not in this work order, which is found not to meet the inspector's code requirements."

IF this is the EXACT wording he put into the contract then get an attorney fast. I say this because of the wording. ----------- timely manner. (period) then it say " This shall also include any repair or replacement, not in work order----------------. His wording covers 2 different scopes of work. Work you have done and any work the inspector finds and deems necessary to meet code.
One thing going for you now is that the inspector has caught him doing the other work with out permits. Talk with the inspector, have him look at your work that was in the scope of work to be done and get him to sign off on it. That way you have fulfilled your part of the contract and you can get out quickly.
And mostly important dont let anyone add wordage to YOUR contract with out running it by your attorney before agreeing to it