ᐅ Costs Incurred When Cancelling a Construction Project

Created on: 9 Aug 2022 20:40
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Davy1983
Hello,

About a year ago, my girlfriend commissioned a prefabricated house. After some back and forth with the building plans and permits, construction work was supposed to start this winter. However, for personal and professional reasons, she has now decided not to proceed with building the house and has canceled the contract with the construction company.

Almost all the work completed so far was outsourced and paid for by her. She has now received an invoice from the construction company listing only 3 hours of structural engineer work as actual labor. The largest portions, however, are overhead and profit. Many items are shown with varying percentage allocations, with the profit actually listed at 100%.

In total, the costs demanded by the construction company amount to 15–20% of the total price for the completed house.

She is quite distressed at the moment, so I am trying to find out to what extent this is legally justified and whether there are options to challenge it.

This is definitely not about trying to avoid costs. It is clear that she will not be released from the contract free of charge. But such an incredibly high bill with many fictitious costs, despite almost no actual work having been done so far, and a 100% profit share is hard for us to understand.

Can you help us and provide advice?

THANK YOU!
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Davy1983
10 Aug 2022 17:14
driver55 schrieb:

@TE: We are all practically waiting for the answer.

Sorry, I’m not online here very often.

Many thanks in advance for your answers and tips.

Page with construction contract text: termination, payment, deadlines, and rights.
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driver55
10 Aug 2022 17:45
Davy1983 schrieb:

Sorry, I’m not online here that often.

Thanks a lot in advance for your answers and tips.

I’ve tried reading it three times now…

But doesn’t it say that the contract was terminated by Bien-Zenker because the client failed to meet their obligations? (No payments made, or what?)
There’s nothing about “the client terminating” the contract.

We also don’t know the whole background…
Davy1983 schrieb:

After some back and forth with the building plans and planning permissions/building permits, the first construction work was supposed to start in winter

…so this really sounds like a case where only a lawyer can help. At first, a consultation costing about $100–150 is probably enough.

Most likely, it just means the client needs to pay. End of story. (Sounds harsh, but that’s how it is…)

What does it mean exactly?
Davy1983 schrieb:

Almost all the work completed so far was outsourced and paid for by my girlfriend.
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TmMike_2
10 Aug 2022 17:54
Could the contract for work possibly become void due to the discontinued KfW subsidy?
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sysrun80
10 Aug 2022 18:01
TmMike_2 schrieb:

Is the fixed-price contract possibly invalid due to the canceled KfW funding?

Very good point – this happened to us, fortunately discovered afterwards.

However, since the contract has already been terminated, this could become complicated. I would definitely consult a lawyer.
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SoL
10 Aug 2022 18:23
It shows 10% for everything that has not yet been completed and 100% for everything that is already finished.

I would suggest withdrawing the cancellation and then selling after completion.
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driver55
10 Aug 2022 18:28
Davy1983 schrieb:

Sorry, I'm not online here very often.
But you do read almost every post in "real time." 🙄
And you need to feed the "experts" here with information…