Hello,
we are building a prefabricated timber frame house on the Swabian Jura and, after some disputes and stress with the manufacturer (from near Passau), have now received a letter stating that they will stop work immediately until the issues are resolved.
The manufacturer still needs to complete ceiling work, sanitary enclosures, flooring, stairs, and doors. Completion was planned for this year.
What options do I have as the client to ensure that the work is finished as planned this year?
we are building a prefabricated timber frame house on the Swabian Jura and, after some disputes and stress with the manufacturer (from near Passau), have now received a letter stating that they will stop work immediately until the issues are resolved.
The manufacturer still needs to complete ceiling work, sanitary enclosures, flooring, stairs, and doors. Completion was planned for this year.
What options do I have as the client to ensure that the work is finished as planned this year?
I can actually see that everyone is somewhat right.
Unlike many here, I work for a construction company. I would like to present the situation from the construction company's perspective:
Our legal consequences for the unlawful refusal to perform are very strict. However, the legal basis is quite limited. In most cases, we are forced to carry out the work. The exception is when a reported concern is not resolved, resulting in a hindrance that eventually makes it impossible to continue the work. In this case, the fault would lie with the client for not pushing matters forward to find a resolution.
The next issue is unlawful refusal to pay – but only after several reminders and usually accompanied by a contract termination – because a progress payment is merely an agreed cash flow advance. The right to full payment arises only upon complete delivery of the service. Here, the construction company is on thin ice, but the client is advised to make the progress payments, since there can be no “overpayment” before the final acceptance date; the client would have the right to a corresponding refund (with interest).
The topic of “disputes over defects” is certainly a reason why the contractor may want to stop working, but this is likely difficult to justify legally. We often discuss the existence of defects for years after acceptance – I do not see this as a valid reason for refusing to perform.
— This is meant as a brief overview to explain why everyone here is actually somewhat right.
The most accurate point, however, is from @Myrna_Loy, who suggested having this clarified by a construction law expert.
Certainly, several issues are present simultaneously, and it is very likely the construction company does not hold all the cards (as mentioned, the legal basis is weak).
Since the entire issue starts with the construction contract (which deadlines were agreed upon, what applies contractually), this cannot be explained here at all.
Unlike many here, I work for a construction company. I would like to present the situation from the construction company's perspective:
Our legal consequences for the unlawful refusal to perform are very strict. However, the legal basis is quite limited. In most cases, we are forced to carry out the work. The exception is when a reported concern is not resolved, resulting in a hindrance that eventually makes it impossible to continue the work. In this case, the fault would lie with the client for not pushing matters forward to find a resolution.
The next issue is unlawful refusal to pay – but only after several reminders and usually accompanied by a contract termination – because a progress payment is merely an agreed cash flow advance. The right to full payment arises only upon complete delivery of the service. Here, the construction company is on thin ice, but the client is advised to make the progress payments, since there can be no “overpayment” before the final acceptance date; the client would have the right to a corresponding refund (with interest).
The topic of “disputes over defects” is certainly a reason why the contractor may want to stop working, but this is likely difficult to justify legally. We often discuss the existence of defects for years after acceptance – I do not see this as a valid reason for refusing to perform.
— This is meant as a brief overview to explain why everyone here is actually somewhat right.
The most accurate point, however, is from @Myrna_Loy, who suggested having this clarified by a construction law expert.
Certainly, several issues are present simultaneously, and it is very likely the construction company does not hold all the cards (as mentioned, the legal basis is weak).
Since the entire issue starts with the construction contract (which deadlines were agreed upon, what applies contractually), this cannot be explained here at all.
H
hampshire26 Nov 2021 10:20Regardless of the legal framework, my professional experience shows that a significant number of conflicts between contracting parties begin with missing or ineffective communication.
A classic example of missing communication is when something is assumed to be “obvious” and therefore left unspoken. Without any ill intent, this can lead to divergent expectations.
A common example of ineffective communication is an emotional statement that the other party perceives as an attack. Here, too, there is usually no malicious intent.
In a conflict situation with a building partner, I would therefore approach the conversation calmly and pursue four goals in sequence:
Conducting a discussion with clearly separated and well-defined points is a skill not everyone possesses. The original poster should critically ask themselves whether they are capable of this—and if not, consider seeking assistance. A mediator is generally someone trained to handle this, and lawyers are usually capable as well. However, lawyers often tend to think in terms of “winning or losing,” which can steer a conflict in a particular direction. This is something to be aware of and decide upon accordingly.
A classic example of missing communication is when something is assumed to be “obvious” and therefore left unspoken. Without any ill intent, this can lead to divergent expectations.
A common example of ineffective communication is an emotional statement that the other party perceives as an attack. Here, too, there is usually no malicious intent.
In a conflict situation with a building partner, I would therefore approach the conversation calmly and pursue four goals in sequence:
- Restoring a good relationship level → if necessary, discussing misunderstandings, expectations, and perceived attacks
- Factual clarification of the tasks and decisions to be made
- Finding solutions for open issues, possibly defining the limits of any remaining disagreement (which does not necessarily have to result in a work stoppage)
- Continuing construction work, potentially with an adjusted construction schedule agreed upon by all parties
Conducting a discussion with clearly separated and well-defined points is a skill not everyone possesses. The original poster should critically ask themselves whether they are capable of this—and if not, consider seeking assistance. A mediator is generally someone trained to handle this, and lawyers are usually capable as well. However, lawyers often tend to think in terms of “winning or losing,” which can steer a conflict in a particular direction. This is something to be aware of and decide upon accordingly.
Jann St schrieb:
Here, the construction company would be on thin ice – but the client is advised to make the installment payments because up until the day of handover, you cannot "overpay." You would have the corresponding right to a refund (with interest).That is a very "clever" piece of advice. Spending years trying to sue for your money, only to end up facing a bankrupt construction company?Fuchur schrieb:
That is quite a "clever" piece of advice. Spending years trying to claim your money back, only to be left with a bankrupt construction company?Well, of course, you shouldn’t pay installments for work that hasn’t been completed. But before unilaterally reducing payments, it’s best to wait at least until the final invoice or last installment. I just wanted to point out that you shouldn’t be too strict out of fear. I think there’s no need to scrutinize everything excessively.
Besides, double security measures are not legally valid – meaning, if a retention or a bond (contract performance guarantee of 10%) is contractually agreed upon, you must not withhold payment twice. This always assumes that the invoicing accurately reflects the work actually done on site.
Jann St schrieb:
extra withholding is not allowedTo clarify in advance – unless there has been an agreement to reduce payment instead of subsequent performance, or it is an ongoing procedure where an expert has proposed a reduction that the contractor still disputes 😉 It is all a legal matter, and when it comes to legal issues, everything requires interpretation 🙂
hampshire schrieb:
Conducting a conversation with clearly and distinctly separated points is a skill that not everyone possesses. The original poster should critically reflect on whether they are capable of this—and if not, seek assistance. A mediator is usually someone trained in this skill, and lawyers are often able to do this as well. However, lawyers tend to think in terms of "winning or losing," which can steer a conflict in a very particular direction. This is something to be aware of and accept. Yes, but it should be noted that usually both parties involved in the discussion are emotionally entangled in the matter and may immediately dismiss valid arguments from the other side.
In such cases, we have had good experiences with mediators who moderate the conversation as neutral facilitators. Otherwise, as you said, everyone wants to win and always sees themselves as right.
However, seeking legal advice on building regulations does not mean you are immediately facing a lawsuit.
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