Should I pay building contractor final payment for works which were dragged out?

vraiment

I took on a contractor to carry out a refurb on my buy to let. I signed a professional contract that the works be completed within 5 weeks but in fact the works dragged on for 7 months. The builders were hardly ever on site and impossible to get hold of during the times they were not around. I drip fed the payments and have still kept back the last installment which is several thousands of pounds. As a result of the time scale, I lost a lot of rental revenue. The contractor is demanding the final payment and is refusing to explain why the works took so long. Should I pay the contractor the final payment? Can the contractor sue me for breach of contract?

LandyAndy

Does the contract provide for liquidated damages?

vraiment

I will have to have another look at the contract to see if does include liquidated damages. It does include a penalty clause for going over the contract but it amounts to only a few hundred pounds.

LandyAndy

vraiment wrote: »

I will have to have another look at the contract to see if does include liquidated damages. It does include a penalty clause for going over the contract but it amounts to only a few hundred pounds.

That doesn't sound too hopeful. Who drafted the contract?

fatbikersbouncebetter

NO NO NOPE NADA NON under no circumstance pay anything until they have finished, or even better threaten to sue ..... DO NOT PAY ANY MORE and contact trading standards straight away.

chippi_2

I think that if your contract says a penalty clause of say £300 or so than that is what you should hold back however a 5 week job should not run in to 7 months ! unless the builder is taking the p.
Assuming that you are happy with the workmanship and any snagging is complete the builder should be entitled to his final payment minus the £300, unfortunately if that is on the contract as a penalty than I think thats that.
As a tradesman im interested to know what happened after the 5 weeks was up, was the penalty clause discussed then ? best of luck.

vaio

vraiment wrote: »

I will have to have another look at the contract to see if does include liquidated damages. It does include a penalty clause for going over the contract but it amounts to only a few hundred pounds.

I didn't think contracts could have penalty clauses which is why LAD ( liquidated and ascertained damages) are there. These are an agreed amount for late completion but everyone I've ever seen is £x per week, sometimes with an upper limit in terms of % of contact sum. For example, they could be set at £300 per week with an upper limit of 5% of the contact sum.

are you sure your contact specifies a fixed amount rather than a fixed amount per week?

Either way, if you've lost 5 or 6 months rent then I'd certainty get some legal advice with view to recovering it from the builder.

keystone

vraiment wrote: »

I took on a contractor to carry out a refurb on my buy to let. I signed a professional contract that the works be completed within 5 weeks but in fact the works dragged on for 7 months. The builders were hardly ever on site and impossible to get hold of during the times they were not around. I drip fed the payments and have still kept back the last installment which is several thousands of pounds.

I am not certain the whole story is being revealed here. The timescales (5 weeks to 7 months) before you started hopping just don't add up if you were dependant on completion for revenue. What action did you actually take during the period?

As a result of the time scale, I lost a lot of rental revenue.

That would be consequential loss. I think you'd be very lucky.

Should I pay the contractor the final payment?

Yes subject to any contractual deductions (whether as LDs or as a penalty clause) for failure to perform on timescale. Was it an "estimated time for completion" or a "will be completed in five weeks" scenario or is it a case of "contractor shall use his best endeavours"? Is there a "time is of the essence" clause?

Can the contractor sue me for breach of contract?

Difficult to say without sight but I suspect he can if the work has been completed and to your satisfaction albeit late. He is entitled to be paid for the work he was contracted to do.

You should consult a contract law specialist. You need to be certain of your position.

Cheers

keystone

fatbikersbouncebetter wrote: »

NO NO NOPE NADA NON under no circumstance pay anything until they have finished, or even better threaten to sue ..... DO NOT PAY ANY MORE and contact trading standards straight away.

Cheers

The_Blue_Hatter

IMO it would depend on what part of the work dragged on. If he was building an extension and the part he hadnt finished was putting the roof on then i'd tell him where to go. If however the part not finished was he hadnt put the skirting and coving on id say you should pay the man (minus the £300).

olly300

vraiment wrote: »

I took on a contractor to carry out a refurb on my buy to let. I signed a professional contract that the works be completed within 5 weeks but in fact the works dragged on for 7 months. The builders were hardly ever on site and impossible to get hold of during the times they were not around.

I hope you talked to the builders and other tradesmen doing the actual work on-site rather than just the main contractor/foreman to find out what was going on. Sometimes you find out interesting things i.e. they haven't been paid for other jobs so won't do your stuff until they are paid.

Legally you are obliged to pay them and yes the contractor can sue you for the payment.

You can obviously counter sue them for lost income if you have enough evidence to prove that they unreasonably delayed doing the work, and you made it clear to them that it was important to complete it within a set time frame.

However I wouldn't bother going to court. Negotiate with the contractor to reduce the amount you should pay, or pay it minus the penalty amount.