ᐅ General contractor requests price increase for the entire house
Created on: 6 Oct 2022 15:33
M
MSHausbauM
MSHausbau6 Oct 2022 15:33Hello everyone,
I’ve read a lot and hope to get some advice...
We are building a house and are about 90% finished. The fixed price agreement expires at the end of October, and the contract doesn’t specify what happens afterward.
Now our general contractor is asking for €50,000.
His reasoning: As of today, the house is 18.66% more expensive, which is €51,250, so he is demanding €50,000 from us.
He already indicated over the phone that it probably won’t be the full 50K, but the 10K we offered was too low.
Now the question is, are we completely mistaken? I don’t see why we should pay extra for the entire house, only for the items that are still outstanding. That would be about €8,000 if you really apply the 18%.
Do you understand what I mean?
Does anyone have legal experience or some tips on how to argue this?
Our lawyer advises settling in the range of €15,000 to €20,000.
I’ve read a lot and hope to get some advice...
We are building a house and are about 90% finished. The fixed price agreement expires at the end of October, and the contract doesn’t specify what happens afterward.
Now our general contractor is asking for €50,000.
His reasoning: As of today, the house is 18.66% more expensive, which is €51,250, so he is demanding €50,000 from us.
He already indicated over the phone that it probably won’t be the full 50K, but the 10K we offered was too low.
Now the question is, are we completely mistaken? I don’t see why we should pay extra for the entire house, only for the items that are still outstanding. That would be about €8,000 if you really apply the 18%.
Do you understand what I mean?
Does anyone have legal experience or some tips on how to argue this?
Our lawyer advises settling in the range of €15,000 to €20,000.
M
MSHausbau6 Oct 2022 15:55lastdrop schrieb:
What does the contract say (exact wording)? The contractor is bound to the fixed price stated in item 1.) for a period of 12 months from the date the contract is signed.
Hello,
um, the fixed price should generally refer to the start of construction. In other words, when the general contractor (GC) begins, they must complete the house within period X for the price Y. If they delay the construction, they have to pay penalties and should not charge additional costs. Using the GC’s argument, they could also delay installing the doorbell by 10 years and then demand the house price from you after 10 years. (Yes, this is exaggerated, but that’s where it leads.)
But the contract structure must be very unusual, since you apparently have already consulted a lawyer and even they recommend paying 15,000 to 20,000 euros?!?
Maybe you could provide a bit more information, because as it stands, it doesn’t add up.
Best regards,
Andreas
um, the fixed price should generally refer to the start of construction. In other words, when the general contractor (GC) begins, they must complete the house within period X for the price Y. If they delay the construction, they have to pay penalties and should not charge additional costs. Using the GC’s argument, they could also delay installing the doorbell by 10 years and then demand the house price from you after 10 years. (Yes, this is exaggerated, but that’s where it leads.)
But the contract structure must be very unusual, since you apparently have already consulted a lawyer and even they recommend paying 15,000 to 20,000 euros?!?
Maybe you could provide a bit more information, because as it stands, it doesn’t add up.
Best regards,
Andreas
W
WilderSueden6 Oct 2022 15:56What is the date of the contract, and how does the general contractor arrive at the conclusion that the amount is now €51....? Own calculations or construction cost index? Was the general contractor obliged to any preliminary services (e.g., building permit / planning permission application) that may have caused delays? What does the contract say about the construction period?
Hi,
There should be more to it. This usually means (and was probably understood by you this way) that the contractor must start construction within 12 months and at a price of X. It does not mean that delays will be rewarded.
Why does your lawyer advise you to make a payment?
Best regards,
Andreas
MSHausbau schrieb:
The contractor is bound to the fixed price stated in item 1.) for a period of 12 months from the date of contract signing.
There should be more to it. This usually means (and was probably understood by you this way) that the contractor must start construction within 12 months and at a price of X. It does not mean that delays will be rewarded.
Why does your lawyer advise you to make a payment?
Best regards,
Andreas