Paying a builder before final inspection + certs

waldopepper

Hi, I'm not sure if there are any official guidelines to how this should work but basically we're in dispute with our builder right at the end of a fairly large structural project.

It started over a year ago, it has been just short of finished aside from some snags etc and a delay due to an insurance job getting in the way of completing the work. In lieu of any actual contract/terms etc (it's our first building work so we didn't know signed documents, payment schedules etc were needed vs lists of work to be undertaken in emails etc!). For about 6 months we had been telling the builder in emails that we will pay the final amount of the build (about 5%) once the snags are done, we have all paperwork: safety certs, manuals, guarantees and the job is signed off by the buildings inspector.

The snags were fixed a week ago, but the builder informed us out of the blue that he now requires payment, then he would release the safety certificates, manuals etc to us, until then 'they remain property of my company'. He says this is just how his company works, but this has never been mentioned before and there is no paperwork mentioning this or any mention on his website. Until now, he had told us twice that the safety certs should have been sent to us, and asked if they had turned up. So to suddenly say it's not his policy to release until final payment raised our eyebrows.

Whenever we had been asked for payment during the work we paid promptly, he has no reason to suspect we wouldn't pay, but we think he's !!!!ed because we found an issue with the quality of some of his work.. that was actually fixed by someone else via an insurance claim from another builder's cover (long story but didn't cost him anything, only lost face).

This leaves us in a bit of a bind, because until we have the safety certs, the building inspector can't sign the whole job off.

Citizens Advice have told us that without any proper contract, terms & conditions etc, technically we don't owe him anything. We want to pay him to get this issue behind us, so they said we could pay now (once he has given all his paperwork) but get him to sign something stating the final building inspection hasn't taken place yet and he would be liable for any issues highlighted.

Is this what people would recommend? What is best practice? What would you do in this situation? Thanks!

AndyMc.....

So if he’s done all the work and snags why aren’t you paying him?

Furts

The situation is crazy. You have wasted six months with emails when you should have been proactive and simply called in the Final Inspection, and then sought a Completion Certificate to protect your interests. Even more crazy is one assumes Citizens Advice have not told you to do this.

Further crazy is you have produced a snag list without first getting this Inspection. This means there could be a further snag list on top of the previous snag list. Any builder is going to be piddled off when clients mess them around with double snagging.

Face up to your legal responsibilities - applying for Buildings Regulations and seeking Inspections is your role. Just get on and do it - call it better late than never!

Best of luck.

Doozergirl

In all honesty, we don’t hand over certificates until the bill is paid off

The last bill is the one the cowboy clients without fail decide to avoid paying. I’ve had four in the past. Perfectly quiet until the last bill and then they’ve spent your money on shiny things for the house.

Sounds like a Mexican stand off to me. Is your paperwork worth more to him than 5% of the bill? He doesn’t have any paperwork saying what was agreed, but I would also expect a retention to be agreed before starting, not to be dictated by a client halfway through the work. It is my pet hate, people suddenly mistrusting after the start, forgetting that they are already being given a credit line.

waldopepper

AndyMc..... wrote: »

So if he’s done all the work and snags why aren’t you paying him?

Because the Citizens Advice solicitor told us not to, at least not without us both signing something to say we are paying before it's completed, they gave us the impression this wasn't usual.

We're stuck in between what they have advised and what the builder is telling us which is not written in any contract so are understandably confused.

teneighty

I wouldn't release the final payment until the work has been signed off by Building Control and you have the completion certificate.

Industry practice is a 2.5% retention at practical completion so maybe you could reach a compromise and pay half the final payment now with the other half once you have all the certificates.

Doozergirl

What teneighty says sounds fair. May break the deadlock.

I’m not sure why CAB are saying it’s not finished but you’re saying it is (other than certs).

waldopepper

Furts wrote: »

The situation is crazy. You have wasted six months with emails when you should have been proactive and simply called in the Final Inspection, and then sought a Completion Certificate to protect your interests. Even more crazy is one assumes Citizens Advice have not told you to do this.

Further crazy is you have produced a snag list without first getting this Inspection. This means there could be a further snag list on top of the previous snag list. Any builder is going to be piddled off when clients mess them around with double snagging.

Face up to your legal responsibilities - applying for Buildings Regulations and seeking Inspections is your role. Just get on and do it - call it better late than never!

Best of luck.

This is the first time we have employed an architect and done major structural work, it's all new to us! We have been guided by our builder on how all this works. He had been dealing with the Builder Inspector directly and arranging visits during the job - he said he would be calling him for the final inspection but this dragged on so we got him round ourselves. Because a WC was on the plans but not installed yet he said he would have to revisit once that's done or the plans redrawn. This is now sorted but he says he still needs the gas and electric certs so we haven't arrange the final visit yet.

The builder was aware of all our conversations with the inspector and didn't tell us we should wait until the final inspection to produce a snag list so no, he can't be annoyed with that situation.

In fact the way around the builder is making this work is that we have to finish our snag list, then get the certs, then do a final inspection so I don't see how we're in the wrong there.

If it's our responsibility to liaise with the inspector then the builder could have told us that! He just said he would deal with him.

waldopepper

Doozergirl wrote: »

In all honesty, we don’t hand over certificates until the bill is paid off

The last bill is the one the cowboy clients without fail decide to avoid paying. I’ve had four in the past. Perfectly quiet until the last bill and then they’ve spent your money on shiny things for the house.

Sounds like a Mexican stand off to me. Is your paperwork worth more to him than 5% of the bill? He doesn’t have any paperwork saying what was agreed, but I would also expect a retention to be agreed before starting, not to be dictated by a client halfway through the work. It is my pet hate, people suddenly mistrusting after the start, forgetting that they are already being given a credit line.

Well we are certainly not in that group, we have tried to get the job finished for a few months so we can settle it all. We have paid on the day when asked for funds all the way through the job and we're only asking advice on the final payment (3% of total) because we have been advised that this isn't normal to pay before the job is signed off.

Now we have experience of this sort of project, we know there should be a payment schedule and all of this agreed beforehand. We weren't dictating holding money back, because there wasn't a payment schedule, we suggested keeping a token amount for when it's completed/inspected and we have all documents etc. This seemed like a standard amount and he didn't mention that being an issue at all at the time (6 months ago and mentioned since).

Mistrust is our pet hate too, we're not sure why he's suddenly changing his terms when we have always paid on the same day when asked, all we're doing is waiting (as agreed) until it's signed off then we can pay the balance.

waldopepper

teneighty wrote: »

I wouldn't release the final payment until the work has been signed off by Building Control and you have the completion certificate.

Industry practice is a 2.5% retention at practical completion so maybe you could reach a compromise and pay half the final payment now with the other half once you have all the certificates.

Thanks, I might suggest this as another way to move it forward.

waldopepper

Doozergirl wrote: »

What teneighty says sounds fair. May break the deadlock.

I’m not sure why CAB are saying it’s not finished but you’re saying it is (other than certs).

That's just my bad English! CAB are saying it's finished but just not signed off yet.