ᐅ General contractor requests price increase for the entire house

kati1337 schrieb:

I wouldn’t count on that at all. Building materials cost a fortune.
My general contractor told me recently that the only reason he can still offer fixed lump-sum prices and stick to them is because he has the necessary liquidity to advance the costs upfront.

Well, if he has to advance the costs with his liquid assets, then he probably recovers that money from the client after the work is completed. That’s what this is about. Then I don’t need a fixed price; he can just present the invoice at the end and, if the client doesn’t agree to pay, he can sue for the money—almost the cost of two houses ;-) Just looking at it from the other side.

11ant schrieb:

If the original poster had taken that into account, they could now comfortably adopt a WYSIWYG approach, consider the current construction progress as "theirs," and assign the continuation of the remaining work at their discretion without fearing any protest from the general contractor.

If only, if only, the bicycle chain.
The original poster has already acknowledged that they acted naively when signing the contract.
I merely said: From the perspective of their current situation, an amicable settlement and accepting the learning experience after reaching an agreement is probably the best outcome they can achieve. And sometimes it’s okay to be satisfied with the status quo. Let go of the strict German mindset, silence the inner critic, and simply accept when things are alright because they could have been much worse. 😉

What would their alternative be at this point? We have already discussed extensively beforehand that legally they are on thin ice, and thin ice in court is dangerous, costly, and so on.

kati1337 schrieb:

I was simply saying: From the standpoint of his current situation, an amicable settlement and accepting the learning curve after the agreement is probably the best outcome he can achieve.

At least a quite reasonable option, yes.

kati1337 schrieb:

Let’s put aside some of the German fussiness, keep the typical German mindset quiet,

*ROTFL* I can’t even count how many times in business I’ve seen a Muslim act more German than a German when it suited their advantage 🙂

kati1337 schrieb:

Because what alternative does he really have at the moment? We have already discussed extensively beforehand that he is on thin ice legally, and thin ice in court is dangerous and expensive and so on.

He has largely cut off his own alternatives beforehand. I wrote my last post not least for readers who are still at the “preliminary stage” and can avoid making the same mistake. The client’s “thin ice” here lies where the unfinished building can still be exposed to damage from weather conditions. In court, it is more the contractor who is on thin ice, trying to assert a claim without a plausible calculation.

---

https://www.instagram.com/11antgmxde/
https://www.linkedin.com/company/bauen-jetzt/

11ant schrieb:

In court, the general contractor’s position is rather weak when trying to make a claim without a comprehensible calculation.

I’m sure the general contractor would come up with something if it came to court. Just because they don’t want to disclose their calculation without pressure doesn’t mean they have nothing to support their case—or that neither they nor their lawyer have any ideas.
There’s also the old saying, “In court and on the high seas...,” about having the right and actually getting it, even if we assume the client is completely in the right.

I also think it’s risky to assume that the general contractor just threw out the price without basis, especially since we don’t even know which contractor it is. I suspect that the 275,000 EUR (about $300,000) price before adjustments might be from a company like Town & Country or a similar one.

These prices usually come from higher management and are based on solid grounds. I definitely don’t believe it’s certain that you would win a dispute in this case.

Also, the idea that the contractor should just give up some profit is quite unrealistic. I want to receive my salary in full every month, without having to give up a part just because the client doesn’t want to pay the full price.

kati1337 schrieb:

I'm sure the general contractor would have an argument in court if it came to that. Just because he doesn’t feel like disclosing his calculations unless pressured doesn’t mean he has nothing to back up his claim—or that neither he nor his lawyer would come up with something.

He can’t just choose that. No one other than him is requesting the price adjustment (according to §313 of the Construction Code, or what other basis should he cite?), so the burden of proof for increased costs lies with him. If he doesn’t want to reveal his cards, his only option is to withdraw the price increase request (or opt to terminate the construction contract—but even then, he must prove the disruption of the contractual basis, not just claim it). The risk for the original poster (OP) here is that the general contractor chooses to terminate—but if I remember correctly, the OP has not demonstrated the difference between the actual value of the achieved construction progress and its rough representation in the payment schedule as significant, and is willing to continue managing on their own. Therefore, the risk is zero once the general contractor declares they want to exercise the termination option. You can set a deadline for the general contractor, and if that passes without action, the OP can threaten termination from their side according to §648 of the Construction Code. I see nothing in this matter that depends on the creativity of a lawyer or the mood of a judge. The Construction Code has pleasantly concise sections on this topic ;-)

xMisterDx schrieb:

And somehow this mindset that the contractor could just give up a few dollars of profit is annoying... that’s a naive view. I want to get my salary monthly, in full, and not give up part of it just because the client doesn’t want to pay the full price.

The client does pay the full price—just not an even higher one. And the contractor has the choice to play the "proven increase" card or the "termination" card from §313 of the Construction Code if they don’t want to use their margin to cover an unexpected price increase risk.

Both parties have made mistakes, but both can agree or part ways. A construction contract isn’t written in stone; people can end it 🙂

---

https://www.instagram.com/11antgmxde/
https://www.linkedin.com/company/bauen-jetzt/