ᐅ Withholding Payments for Defects in the Shell Construction Phase
Created on: 9 Feb 2021 16:57
K
Kishihmen
Hello everyone,
The ceiling above the ground floor has just been concreted on our site. According to the payment schedule, a partial payment of approximately €30,000 is due.
However, our expert has identified several defects. These were formally reported to the general contractor (GC) with deadlines. The first deadline (2 weeks) passed without the defects being resolved; the second deadline is still running until Thursday (also 2 weeks).
So far, we have withheld about €17,000 of the €30,000. Our GC considers this amount far too high and insists on payment.
Since we are currently concerned about the potential insolvency of the GC (the structural builder, brick supplier, steel supplier, and light well supplier have not been paid), we want to keep the deduction as high as possible. However, since we are not construction professionals and want to avoid the risk that withholding too much for defects could backfire, I hope that some experts here can provide us with a rough cost estimate.
P.S. Our lawyer has been contacted, but the appointment is only scheduled for 17.02, and I fear we cannot hold off the GC until then.
Defect 1:
At the transition between the basement and the ground floor, no damp-proof course was installed at the base of the first course of blocks.
The basement is already fully lined with Styrodur insulation, and the excavation pit has been backfilled.
Defect 2:
In some areas of the structural shell, the minimum offset of the bricks was not observed; in places, up to 7 courses of bricks were laid directly on top of each other.
Defect 3:
This is a row house. Mineral wool boards were installed between the buildings for sound insulation. At one externally visible spot, there is a gap of about 80cm (31.5 inches) depth and approximately 20cm (8 inches) height between the boards. After reporting the defect, the structural builder just “stuffed” mineral wool boards into the hole. According to our lawyer, this does not reliably ensure soundproofing.
Defect 4:
The area where the patio doors will later be installed was cast in concrete. Here, the reinforcing steel protrudes from the wall. According to the expert: This means that a proper bond between the reinforcing steel and concrete is not sufficiently ensured. It is assumed that adequate long-term corrosion protection of the reinforcement steel is not established. Furthermore, with insufficient concrete cover over the reinforcing steel, adequate fire protection is not guaranteed.
Defect 5:
In the floor slab area, the mineral wool board was not properly secured. As a result, it is quite wavy. This is particularly problematic in the stairwell area, where in some places only 10cm (4 inches) of concrete remain above the mineral wool board. The partition wall bricks have a thickness of 17.5cm (7 inches), though.
Defect 6:
The mineral wool boards were not installed tightly enough in some areas, allowing concrete to seep between the boards and create a sound bridge.
These are the (known) defects so far. I would greatly appreciate it if anyone could roughly estimate the costs associated with these defects.
Thank you very much in advance.
The ceiling above the ground floor has just been concreted on our site. According to the payment schedule, a partial payment of approximately €30,000 is due.
However, our expert has identified several defects. These were formally reported to the general contractor (GC) with deadlines. The first deadline (2 weeks) passed without the defects being resolved; the second deadline is still running until Thursday (also 2 weeks).
So far, we have withheld about €17,000 of the €30,000. Our GC considers this amount far too high and insists on payment.
Since we are currently concerned about the potential insolvency of the GC (the structural builder, brick supplier, steel supplier, and light well supplier have not been paid), we want to keep the deduction as high as possible. However, since we are not construction professionals and want to avoid the risk that withholding too much for defects could backfire, I hope that some experts here can provide us with a rough cost estimate.
P.S. Our lawyer has been contacted, but the appointment is only scheduled for 17.02, and I fear we cannot hold off the GC until then.
Defect 1:
At the transition between the basement and the ground floor, no damp-proof course was installed at the base of the first course of blocks.
The basement is already fully lined with Styrodur insulation, and the excavation pit has been backfilled.
Defect 2:
In some areas of the structural shell, the minimum offset of the bricks was not observed; in places, up to 7 courses of bricks were laid directly on top of each other.
Defect 3:
This is a row house. Mineral wool boards were installed between the buildings for sound insulation. At one externally visible spot, there is a gap of about 80cm (31.5 inches) depth and approximately 20cm (8 inches) height between the boards. After reporting the defect, the structural builder just “stuffed” mineral wool boards into the hole. According to our lawyer, this does not reliably ensure soundproofing.
Defect 4:
The area where the patio doors will later be installed was cast in concrete. Here, the reinforcing steel protrudes from the wall. According to the expert: This means that a proper bond between the reinforcing steel and concrete is not sufficiently ensured. It is assumed that adequate long-term corrosion protection of the reinforcement steel is not established. Furthermore, with insufficient concrete cover over the reinforcing steel, adequate fire protection is not guaranteed.
Defect 5:
In the floor slab area, the mineral wool board was not properly secured. As a result, it is quite wavy. This is particularly problematic in the stairwell area, where in some places only 10cm (4 inches) of concrete remain above the mineral wool board. The partition wall bricks have a thickness of 17.5cm (7 inches), though.
Defect 6:
The mineral wool boards were not installed tightly enough in some areas, allowing concrete to seep between the boards and create a sound bridge.
These are the (known) defects so far. I would greatly appreciate it if anyone could roughly estimate the costs associated with these defects.
Thank you very much in advance.
K
Kishihmen9 Mar 2021 12:44Hello everyone,
I wanted to give you an update.
We had our appointment with the lawyer. Unfortunately, the outcome was not very positive:
- Regarding the insolvency of the general contractor (GC), action can only be taken once the GC has officially filed for insolvency.
- Concerning the defects, the lawyer advised us to withhold the payment. In principle, there would also be a right to terminate the contract, but he advised against it as long as we don’t have someone who can fix the defects and continue the construction at an affordable price for us.
We then tried to talk to the GC again for the time being. Initially, this sounded positive. We were promised that a new shell builder would be ready to continue work starting March 1st. We were also promised a site manager would be assigned to supervise the construction and the defect repairs.
On March 1st, an inspection took place with the site manager and an expert (the defects total between €40,000 (about $44,000) according to the site manager and €50,000 (about $55,000) according to the expert) for all three houses combined.
Due to the high costs of fixing the defects, our GC has decided to have the shell builder responsible for the issues carry out the repairs. However, our new site manager refuses to take over the site management.
Additionally, we are currently having some problems with the electrician, who has not been paid for his temporary power supply box on site since November (€700 (about $770)) and is now demanding the money from us, including a threat that he will come over with his guard dogs and we will then see whether we pay his invoice.
After a phone call with our GC, he told us that he would like to pay but currently does not have the money!
Our conclusion from this call is that we urgently need to look for alternatives to complete the building. Even though insolvency has not yet been filed, I think it cannot be far off if there is not even €700 (about $770) available anymore...
I wanted to give you an update.
We had our appointment with the lawyer. Unfortunately, the outcome was not very positive:
- Regarding the insolvency of the general contractor (GC), action can only be taken once the GC has officially filed for insolvency.
- Concerning the defects, the lawyer advised us to withhold the payment. In principle, there would also be a right to terminate the contract, but he advised against it as long as we don’t have someone who can fix the defects and continue the construction at an affordable price for us.
We then tried to talk to the GC again for the time being. Initially, this sounded positive. We were promised that a new shell builder would be ready to continue work starting March 1st. We were also promised a site manager would be assigned to supervise the construction and the defect repairs.
On March 1st, an inspection took place with the site manager and an expert (the defects total between €40,000 (about $44,000) according to the site manager and €50,000 (about $55,000) according to the expert) for all three houses combined.
Due to the high costs of fixing the defects, our GC has decided to have the shell builder responsible for the issues carry out the repairs. However, our new site manager refuses to take over the site management.
Additionally, we are currently having some problems with the electrician, who has not been paid for his temporary power supply box on site since November (€700 (about $770)) and is now demanding the money from us, including a threat that he will come over with his guard dogs and we will then see whether we pay his invoice.
After a phone call with our GC, he told us that he would like to pay but currently does not have the money!
Our conclusion from this call is that we urgently need to look for alternatives to complete the building. Even though insolvency has not yet been filed, I think it cannot be far off if there is not even €700 (about $770) available anymore...
Hausbau08159 Mar 2021 12:54That doesn’t sound good. If he can’t pay 700 € (about 740 USD), he’s insolvent. As soon as he hires a contractor, who he also can’t pay, he would be committing a criminal offense. It’s all a mess, and the fact that the obligation to file for insolvency has been suspended by law due to Corona doesn’t make it any better.
Kishihmen schrieb:
I wanted to check in again with an update.Thank you for the feedback.
That doesn’t sound good. $50k for defect remediation?
You should withhold that from the payment.
There might be potential savings in the execution phase.
K
Kishihmen9 Mar 2021 13:53This is the amount we have withheld from the invoice. Although it doesn’t change the fact that there was an overpayment, at least this portion is still accounted for.
There are a total of three townhouses. That means for each house we have defects costing between 15,000 and 17,000 USD. Some amount might be negotiated, but overall the full sum will probably be needed.
- The ceiling in the insulation area needs to be opened up.
- Prohaus has to dismantle a partition wall to properly establish soundproofing.
- Reinforcing steel is protruding from several parts of the buildings and must be sealed.
- Ground floor waterproofing was omitted.
- Some walls need to be demolished because the minimum offset was not maintained.
- Plus a few smaller defects.
icandoit schrieb:
That doesn’t sound good. $50k for defect remediation?
There are a total of three townhouses. That means for each house we have defects costing between 15,000 and 17,000 USD. Some amount might be negotiated, but overall the full sum will probably be needed.
- The ceiling in the insulation area needs to be opened up.
- Prohaus has to dismantle a partition wall to properly establish soundproofing.
- Reinforcing steel is protruding from several parts of the buildings and must be sealed.
- Ground floor waterproofing was omitted.
- Some walls need to be demolished because the minimum offset was not maintained.
- Plus a few smaller defects.
H
HilfeHilfe9 Mar 2021 14:43Oh no, I’m really sorry for you.
K
Kishihmen9 Mar 2021 15:10Yes, somehow you always hope it won’t happen to you 🙁
We have now received the first offer from an architect. However, I have created a new thread about it.
We have now received the first offer from an architect. However, I have created a new thread about it.
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