# Client refuses to pay on verbal change



## attiken (Mar 22, 2007)

original contract stated a price to include roofing on a room addition.
work started and found issues, contract for the roofing cost was understated. informed client on additional costs but a change order was not signed for the additional costs.
invoices have been discounted to the point where I am at a loss
job completed and client refuses to pay remainder of invoice.
NOTE: client was sent invoices with changed amounts as well as statements.
also brings up this and that they never mentioned until now. So basically trying to make a case to make me look bad. Told them find, i'll do this and that IF they agree to pay the remainder.

Now the client is saying I owe them money back because they paid more then the "original" contract states.

What are my options? I can't do a mechanics lien, apparently I had to have to sign something in the beginning to be able to even file. So that's out.

It's their word against mine on the add'l costs from the original since a change in contract was never signed.


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## Forry (Feb 12, 2007)

Huh.... hard to be nice about this one.... seems like you understand the problems in how you dealt with the paperwork.... how much are you out? This is a great time to learn from you're mistakes.

If they paid you more than the original contract, you may be able to use that fact to prove that you entered into a new contract, and usually a verbal contract is binding... the $ changing hands proves that you both understood that a change was in effect.

Do you clearly understand the difference between an estimate and a firm bid price? Many contractors don't.

ALWAYS have a written change order. ALWAYS. If you don't, be willing to not get paid for the change.

Worst case... You don't have to give them any money back.


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## skyhook (Mar 17, 2007)

Sad but true. Make it up on the next CO.


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## DUSE (Apr 15, 2006)

I hate hearing this .
What state are you in?
In NJ you would be sooooo screwed.

I believe These people go into these jobs with every intension on not paying.
I pretty much refuse to work for Lawyers and Judges unless I know them real well.
WE as contractors should all be sticking together,
if I dont get payed,you dont go in and finish the work.
But theres so many guys that dont care,as long as they get paid screw the last guy 
In defence of the HO
theres some guy's who shouldent get paid and hacked the job so bad they should be in jail


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## Joasis (Mar 28, 2006)

I doubt you have any recourse....best take your lumps and walk on unless the client actually sues you. 

I have heard verbal contracts are enforcable, but I have yet to see one actually enforced. You may roll the dice in small claims court and get a mediator that will work with the client, but chances are the client is going to hold up the original contract as their "proof" and deny ever hearing or knowing about anything else...their only admission of understanding would be their payment of any amount over the contract...which could imply they knew, but when the job was done, decided to beat you out of it. 

Never agree to additional work, either to secure payment or in a change order without a contract...even a simple job order without legal language will work.


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## DecksEtc (Oct 27, 2004)

skyhook said:


> Make it up on the next CO.


Not a very ethical response to the problem skyhook.

You (the contractor) made a mistake by doing work without anything in writing.

Why should the next customer(s) pay for a mistake you made?


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## RobertCDF (Aug 18, 2005)

DecksEtc said:


> Not a very ethical response to the problem skyhook.
> 
> You (the contractor) made a mistake by doing work without anything in writing.
> 
> Why should the next customer(s) pay for a mistake you made?


Its kind of ok... Look at it a little differant. HD knows about how much they will loose to theft, and figure that into pricing across the whole store. Its not fair but everything we buy there may be $.01-$.05 more expensive because of thievs.

What would be wrong was if he tried to make it up on 1 change order.


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## slickshift (Jun 14, 2005)

Accept payment up to the original contract price
Forget about the additional work invoice
Consider it "tuition" paid, let it go, never do work w/o something signed again, and never discount invoices


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## bill r (Feb 19, 2007)

Around these parts, a verbal can be proven only by witnesses. Trouble is, those witnesses have to be independent; can't be your wife, your empoyee, your buddy. That almost never happens. Sociopaths. Ugh.


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## Mike Finley (Apr 28, 2004)

Personally I will never, ever walk away from something like this. I would be down at small claims court filing my claim and getting them served. 

#1 Some jerks are just trying you on and a summons to court could shake money out of the tree.
#2 See my first sentence.

Taking them to small claims is going to benefit you two-fold. For 1, obviously it could get you your money. But even if you don't win, you will find out first hand exactly why you aren't able to win your case and that will help you structure all the rest of your business dealings in the future in the correct way to give you winnable cases if this happens again.

Never, never, never would I write this off, chock it up to experience of life's tuition without fighting them first. If you are in the right, you are in the right, that's all there is to it. Go after them. At least make *them *spend some of their valuable time trying to rip you off.

People like this are prevelent because too many contractors just slink away like pieces of sh*t instead of standing up for themselves, don't be one of them.


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## attiken (Mar 22, 2007)

appreciate everyone's response.

I'm in CA.

Will have to look up laws here to see where and if there's a chance in Small Claims because of the verbal change.

The client has received invoices and statements up to the last one with the changed costs, etc ... but done of those were signed either.

However I did receive the "add'l" amount, not in full but more then the original contract.


We are going to mediation. this is actually per their request.

And, yes, they are looking out for them as they are in a real financial hard-ship now more then before.

I gave them a lot. Let them use their credit cards to buy Home Depot Gift Cards as payment. And as much as I didn't want to, allowed them to use their credit card to pay vendors direct because they didn't have the cash to pay me direct. and the list goes on ...


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## Tom M (Jan 3, 2007)

There out of liquid cash. The judge " if in your favor" will have to put them on a payment agreement. I never had to deal with this, but sometimes like Mike said a firm threat is what gets things happing you never know. Give it a try.


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## skyhook (Mar 17, 2007)

DecksEtc said:


> Not a very ethical response to the problem skyhook.
> 
> You (the contractor) made a mistake by doing work without anything in writing.
> 
> Why should the next customer(s) pay for a mistake you made?


After a few hits you get a feel for trouble. Going into a big job in Spyglass Hill, I suspected this. I charged an additional 10% on the contract, he signed. I added 10% to every CO, he paid. At end of the job, balance was $6k. He refused to pay, I threatened to file a lein. He threathened to sue for filing a false lein. With the added 10% I was already $10k ahead. I walked away lighthearted.


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## Ed the Roofer (Dec 12, 2006)

In addition to always using the proper change order procedure, this is exactly why I always do an "In Job Progress Evaluation For Customer Satisfaction" report plus the end of job report as well.

It immediately will identify if there are any debateable ambiguities between the two parties. Even if they make no commentary on the form and just sign off on the questionairre, they have implied agreement to all of the previously mentioned additional work done.

I even won outright with a 3 judge mandatory non-binding arbitration panel and eventually the small claims court system, my arguement that the homeowner had agreed to the change orders just by having all of the documents given to her on a timely basis, although she refused to sign anything during the course of the job. I won the entire $ 28,000 judgement in that case.

Ed


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## john elliott (Oct 23, 2005)

Mike Finley said:


> Personally I will never, ever walk away from something like this. I would be down at small claims court filing my claim and getting them served.
> 
> #1 Some jerks are just trying you on and a summons to court could shake money out of the tree.
> #2 See my first sentence.
> ...



Excellent stuff. I particularly liked this bit.......


Mike Finley said:


> even if you don't win, you will find out first hand exactly why you aren't able to win your case and that will help you structure all the rest of your business dealings in the future in the correct way to give you winnable cases if this happens again.


Hasn't happened to me, yet, but if it does I will be following this advice

John


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## StormTech (Mar 14, 2007)

If you have not collected all the money then tell them you are headed to small claims court. Its a pain in the butt but can be a good bargaining tool to settle.


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## Driftwood (Feb 15, 2004)

Sorry to hear this .DO You have a license? I'm in Ca. also Licensed a long time


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## wackman (Nov 14, 2005)

I do all my proposals, contracts, etc.. on the computer but I have about 5 hand written change order forms with me on all jobs just for this reason. If the homeowner isn't there at the time I call them, explain the change and fax it to them if possible so we don't have to pull off for the day, but unless I know them I don't do anything extra with out that piece of paper and I also take digitals of the COed area.


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## theworx (Dec 20, 2005)

Great point wackman, taking pics of the extra work being done was the first thing that popped into my head!!! Why would any contractor of sound mind do extra work that would cost him money without some kind of agreement (verbal or written)!!! Not talking hanging a painting for a client because you have the tools and ten minutes to do it... I mean actual extras to get the job originally contracted done properly!!! I feel pics of the extra work being done would help if you ever ended up in court. I'm sure a Judge would realize you're in business to make a living (not lose money) and to be doing extra work out of your pocket, without even a verbal agreement, is something you would not do!!! The pics would help back up your case...


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## JamesNLA (Jun 2, 2006)

> Its kind of ok... Look at it a little differant. HD knows about how much they will loose to theft, and figure that into pricing across the whole store. Its not fair but everything we buy there may be $.01-$.05 more expensive because of thievs.
> 
> What would be wrong was if he tried to make it up on 1 change order.


ummm, not that is not OK. He is not Home Depot, and they didn't steel from him. He has all his tools. I get it that they got his additional materials and labor for the change orders but he will have to prove that in court....or where ever. Ya can't add an additional XXX% to the invoicing to cover theft. That is steeling in it of itself.


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## Sonny Lykos (Mar 11, 2006)

Who pays for the public and employee theft in retail stores? We all do.

Who pays for the service call on a new truck or frig that’s under warranty? We do.

And is why for years I’ve been suggestion to our peers to include about 1.5% in their overhead for warranty work, and another 1.5% in their overhead for bad debt.

We all know there are thieves around, including our own customers.

That being said, when I under estimate a job, or if a sub under estimates his end of it, I never tell the customer and ask for more money during the project. I eat it.

Think “reserves” for what is normal in our industry, and we all know what will happen; it’s just a case of when.


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## hrscammisa (Mar 9, 2007)

I think as you do more jobs you get the feel for the h.o dont be afraid to walk away from a job if it doesen't feel right I gave a bid on a shower redue for a clients rental it was occupied so I told her I would have it done in two days well I ran like hell 12 hours the first day and few hours the next day when I ask for my money she threw a fit and would not pay me called the cops the hole works she said I owed her 6 more hours I said I'm done she wanted me to work for her on other stuff untill I had work for two days because I said I would have it done in two days I left with no payment two weeks later she sent it to me with a nasty leter even the cop came in and looked at my work and said pay the man its a great job dont be friends with them stay firm and GEt IT IN writing


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## farrellpainting (Feb 24, 2007)

Sonny Lykos said:


> Who pays for the public and employee theft in retail stores? We all do.
> 
> Who pays for the service call on a new truck or frig that’s under warranty? We do.
> 
> ...


 
Retail stores are allotted a specific amount of $$$ for theft through Ins. the consumer does not make up the difference.

If you under estimate a job and you go over you eat it? Somewhat noble of you, but shows that you might not be respecting yourself enough! What I mean is, if you were working for a contractor and he told you 25hrs to complete a job and it took you 33hrs of bustin your azz, wouldn't you expect him to pay you for 33hrs.Give yourself some credit, no one can estimate a job down to the last hour, thats why it's called an estimate and we have clause's in our contacts to protect us because of this!We should all get paid for the work that we do just as our workers expect to get paid their hrs! 

BTW how much per sqft LOL!


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## MadDog (Mar 18, 2007)

It all boils down to one simple rule of thumb for contractors.

When it comes to money, _write everything down_.


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## skyhook (Mar 17, 2007)

farrellpainting said:


> Retail stores are allotted a specific amount of $$$ for theft through Ins. the consumer does not make up the difference.
> 
> If you under estimate a job and you go over you eat it? Somewhat noble of you, but shows that you might not be respecting yourself enough! What I mean is, if you were working for a contractor and he told you 25hrs to complete a job and it took you 33hrs of bustin your azz, wouldn't you expect him to pay you for 33hrs.Give yourself some credit, no one can estimate a job down to the last hour, thats why it's called an estimate and we have clause's in our contacts to protect us because of this!We should all get paid for the work that we do just as our workers expect to get paid their hrs!
> 
> BTW how much per sqft LOL!


Have to disagree, if you bid a job for 25 hrs and it takes you 33, I'm only paying you for 25. That's why it's called a contract. If it takes you 18 do you still get paid for 25?


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## farrellpainting (Feb 24, 2007)

Skyhook, if you bid a job at 25hrs, (expecting that you TRUST your employee's) and it took me 33 honest hrs of bustin azz and you said nope, I'll pay you for 25hrs, and thats it!You would catch a mean "lefthook" before I left! I box recreationally to manage my frustration, I'm not a big guy, but your gettin DROPPED in front of the rest of your employee's for that, no doubt!

You sound like one he11 of a guy to work for though! LOL!


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## john elliott (Oct 23, 2005)

Farrell, how would it be Skyhook's bid if it was you that was doing the work and being paid for it? I think you've misunderstood his point.

Plus, it might very well be that Skyhook is a big guy, and a better boxer than you. First rule of fighting is- never _assume_ that you can defeat an opponent.

John


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## skyhook (Mar 17, 2007)

farrellpainting said:


> Skyhook, if you bid a job at 25hrs, (expecting that you TRUST your employee's) and it took me 33 honest hrs of bustin azz and you said nope, I'll pay you for 25hrs, and thats it!You would catch a mean "lefthook" before I left! I box recreationally to manage my frustration, I'm not a big guy, but your gettin DROPPED in front of the rest of your employee's for that, no doubt!
> 
> You sound like one he11 of a guy to work for though! LOL!


I don't hire employees, I hire Subs. Never had a Painter come back and ask for more $ because it took longer than he thought. As for your left hook, I've scraped with the best, it comes with the territory. So take your best shot and give me a reason, my best friends are Smith & Wesson.


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## farrellpainting (Feb 24, 2007)

John, I learned to never under estimate my opponent in the ring, and I apply that to every aspect of my life, whether it be physically or mentally! my point is that if he underestimated a bid for a job that I was doing for him I would expect to get paid in full if I busted my azz as his employee!As any contractor should expect to get paid in full for the work that was needed in order to complete the job as a professional!

Secondly as a (somewhat) boxer I learned to never doubt myself! I've fought many guys twice my size, and twice my age, most that just got out of prison that I've left bleeding on the mat, or street, friends floors etc.. Brothers floor to be specific!Anyway I wasn't really talking about man to man boxing, more, I would just hay maker someone that didn't want to pay me for my work!

I'm an Irish man, my grandfather tought me two things before he left: how to drive a nail, and how to fight!

BTW, John, who ever taught you that the first rule to fighting, is to never assume that you can beat your oppenent, probably got their azz beat alot!

Got in late! smiff n wesson is a childs game!


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## slickshift (Jun 14, 2005)

farrellpainting said:


> Retail stores are allotted a specific amount of $$$ for theft through Ins. the consumer does not make up the difference.


This is not true
Retail stores are not allotted any money for theft through insurance
Losses through theft are directly added to the retail price
That means theft directly affects retail price and the consumer pays for it


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## Same Old (Mar 9, 2007)

Wow you're a dumbass Farrell. 

Who do you think pays insurance? I've had subs that underbid and come for more. If it is an unforseen circumstance I'm fair, but If everything is as I said it would be and there are no suprises they can feck off. 
We're the pros, not the homeowner. If you tell them it costs $2k, they should only pay $2k. If you tell tem it will cost $2-3k, it better be in that range. If you can't get your bids right you won't be inbusiness long enough to pay for your assault defense. 


I love you dumbass neanderthals that think they can punch a client. Good luck in life with that attitude. Maybe you should move to a third world country where your attitude is appreciated, your quality will probably fit in too. 

Wow, what a moron.


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## Grumpy (Oct 8, 2003)

attiken said:


> original contract stated a price to include roofing on a room addition.
> work started and found issues, contract for the roofing cost was understated. informed client on additional costs but a change order was not signed for the additional costs.
> invoices have been discounted to the point where I am at a loss
> job completed and client refuses to pay remainder of invoice.
> ...


Youa re in an expensive situation where we've all probably been before. I was only able to chalk it up to "tuiton for the school of hard knocks." and I fear you will also. 

Unfortunately I account for some level of "bad debt" per year and it's factored into my budget and pricing. So what I am saying is, you might have to raise your prices to cover your loss. 

If you have ANY legal ground to stand on, then FIGHT FIGHT FIGHT.


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## boman47k (Oct 13, 2006)

I was always under the impression that ins ratea were affected bt occurances of theft or the risk of theft. If any money is allotted to anyone, I would think the ins co's allott it to them selves when computing their rates.

This thread brings up a good point about charging more if a job takes longer, less if it gets finished quicker. Seems it would depend on how you charge and the how the contract is written. Five days or *within* five days, *estimated time of completion*, five days, etc... If i t is a t & m contract, that is one thing, but a square footage type deal is another. If in figuring my price, I base it on the time I think it will take me and I finish it quicker, should I reduce the price? Hmm, customer had a problem, I fixed it for a set price. If I drop the price I still get my hourly rate for the time spent on the job, and customer is happy maybe even impressed with a reduced price. Customer speaks highly of you. Then again I have that time allotted for that job, so it sort of ties up my schedule. Another thing, what is two contractual days? Two 8 hr days or one 12 and one 4? I guess just have to be careful with estimating and hope their is no big descrepency in the time quoted.


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## john elliott (Oct 23, 2005)

farrellpainting said:


> BTW, John, who ever taught you that the first rule to fighting, is to never assume that you can beat your oppenent, probably got their azz beat alot!


Actually he was a sergeant/PT instructor in the SAS

John


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## wackman (Nov 14, 2005)

farrellpainting said:


> Skyhook, if you bid a job at 25hrs, (expecting that you TRUST your employee's) and it took me 33 honest hrs of bustin azz and you said nope, I'll pay you for 25hrs, and thats it!You would catch a mean "lefthook" before I left! I box recreationally to manage my frustration, I'm not a big guy, but your gettin DROPPED in front of the rest of your employee's for that, no doubt!
> 
> You sound like one he11 of a guy to work for though! LOL!


If you gave me a quote based on you thinking it's going to take 25 hours and we sign a contract (I don't do verbals and I usually don't do t&m), then it actually takes you 33 hours and there were no surprises then I'm still paying you your original price based on 25 hours and next go around I'm gonna expect you'll have your costs better dialed in. I might be pissed at you for fukkin up my schedule too!

Wack


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## dirt diggler (May 14, 2006)

why do i read this stuff? 


wonder what's on Spike TV ....:whistling


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## skyhook (Mar 17, 2007)

I can think of one time I did pay the extra. A hard demo contract, I got three bids, 32K, 25K and 7K. I went with the lowest, first day into it the contractor came to me and said, those tree rings are solid concrete, 12" thick and he needed another thousand. I said ok but you have to be done by Friday. He got it done.


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## Tscarborough (Feb 25, 2006)

Verbal contracts are generally legal, but they are so hard to prove that it is not worth the effort or expense. Cost it out to bad debt and tuition, and move on.


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## AtlanticWBConst (Mar 29, 2006)

wackman said:


> I do all my proposals, contracts, etc.. on the computer but I have about 5 hand written change order forms with me on all jobs just for this reason. If the homeowner isn't there at the time I call them, explain the change and fax it to them if possible so we don't have to pull off for the day, but unless I know them I don't do anything extra with out that piece of paper and I also take digitals of the COed area.


Good point....Have change order 'forms' ready and on hand to fill out and get signed...if need be. 

Change orders are so often put on the back burner by all of us, because of being consumed with the work at hand. 

But they are key to getting paid for ALL of our work....


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## Ted W (Jan 7, 2007)

A contract is a contract. Forget the number of hours and forget the price of materials. If you say you're going to do something for a certain amount of money, you keep your word and do it. 

When the job changes, write up a change order and GET IT SIGNED to compensate for the extra work and or materials. 

We're not children here, and this ain't romper-room. This is a business and professionalism is a must. I've taken my losses and got back up on my feet. I've been screwed by unscrupulous customers in the past and learned to cover my a$$ from then on. 

I work time and materials almost exclusively, but that doesn't mean I don't know contracts. Larger jobs call for a contract. An estimate is when we go to look at the job and determine ABOUT how much it will cost and how long it will take. However, the job doesn't get scheduled until the CONTRACT is signed. The contract stipulates what is to be done in what amount of time for such an amount of compensation. Extras shouldn't get done until the change order is SIGNED. 

There are rules. Don't follow the rules and you will eventually pay the price. Be a professional and take care of business in a professional manner. That's the bottom line.

BTW, a change order can be written on a napkin as long as it's signed.


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