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Ash
Ash, Solicitor
Category: Law
Satisfied Customers: 10915
Experience:  Solicitor with 5+ years experience
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I am having a dispute with a builder who is modernizing

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hi - I am having a dispute with a builder who is modernizing a house I bought recently. we both signed a quotation/contract from his company (newly setup limited) to complete the job in 1 month. 1.5 months later, he had taken all the funds from us, job wasn't done and he asked for 45% more to complete the job in another 2 weeks. We reluctantly agreed. 2 weeks later, job is not done and he is saying that the funds are finished. At this time last week, I wrote him a letter telling him he is in breach of our contract on cost / timeline and asked him to complete the work. He's threathening arbitration and walking out of the job.
The house is partially done, but the electrics, kitchen, windows etc are still pending, which require expendiure of about £15k more. He says that he doesn't have any more money to do the job and wants more funds to coninue. I don't want to pay him more, but I feel I'm hostage to him as the job is around 60% done. so bringing someone else in to complete the job may cost more.
My question what is the best way forward? should I pay him more, and if so, how can I guarantee that he will finish the job and not ask for more? what is the best way to recover the money from him in case I bring in someone else to finish the job? can I report his misconduct to any regulator / trade association?
Submitted: 9 months ago.
Category: Law
Expert:  Ash replied 9 months ago.
Hello my name is ***** ***** I will help you.What does the contract say about disputes please?Does it say that its a firm quote, or subject to change?Alex
Customer: replied 9 months ago.
hi -
There is no mention of dispute on the contract.
The governing document is a 'Quotation, Contract and Specification of the works'. It is 4 page document.
The only clauses relating to subject to change are that 'specification / pricing is subject to change due to changes imposed by local council's building control dept.'
Expert:  Ash replied 9 months ago.
Ok - then the original quote is the contract. You can sue for the return of those extra sums paid and ALSO the cost of getting the work completed.You need to write and set out your losses and request a refund within 14 days or say you will go to Court within 14 days. You should make sure you send this signed delivery and keep a copy.If they do not refund you then you can issue proceedings in the County Court. You can either do this online at: www.moneyclaim.gov.uk or by completing form N1 http://hmctsformfinder.justice.gov.uk/courtfinder/forms/n001-eng.pdf and take it to your local County Court.The Court will then issue a claim which a copy will be sent to the Defendant who will have a limited time to defend it, if not you can enter Judgment and enforce.But the original quote was the contract for the works. The builder can NOT claim more money. You can also ask the Court to order him to finish the works under the original contract. If the claim is for £10,000 or less it will be a small claim so you will not need legal representation. Over this value you would need representation for trial.Can I clarify anything for you about this today please?Alex
Customer: replied 9 months ago.
thanks Alex. lets put some more detail here... the original contract was for £36.5k. 1.5 months later he asked for another £15k because he said that the job is bigger than he anticipated, he is out of funds etc. and threatened arbitration. He verbally assured us that with the additional funds he will complete the job in 1-2 weeks. Till now, I've paid him the full original amount + £12k of the additional amount. I estimate that approx £15-20k of work is remaining.Now, he is asking for another £15k, which I've refused (and issued the letter of breach to him) and he is threatened to stop the work.Looking back, it seems he mismmanaged funds (probably using our funds for other projects) and also including work items in the job we didn't ask for which he says increased by cost, but which we were informed about before hand. or get our approval on (he is saying this was to do a good job).what would be the total claim we should persue him for?He is a limited liability company, newly setup, so is unlikely to have cash...
Expert:  Ash replied 9 months ago.
That makes no difference, whether its bigger than he thought. That is not your problem - he gave you a quote and needs to stick to it.You have 2 choices:1) Go to Court and get the Court to make him do the work and then give you back the amount above £36,5002) Get prices for getting the work done elsewhere (I would do this anyway to see how the £15k compares) and then sue for that extra costs PLUS the sum of above £36,500 backDoes that clarify?Alex
Customer: replied 9 months ago.
Hi Alex, we weren't able to see you response the past 2 days due to a technical issue with the website. coming back to the query... The builder has now walked off the job without notice or completion. Other builders must now be found to complete the work. Questions:-1) Communication with Builder: per your message above I should write him a letter, set out my losses and ask for a refund within 14 days or I tell him I'll take him to court. Is this correct? can the losses be an estimate at this time or do we need actual quotations (and if so, who should give the quotation - contractors / builders / surveyors / etc ?)2) Re my taking him to court: Per your message above, if they don't refund within 14days,I should issue proceedings in the County Court (online at: www.moneyclaim.gov.uk, or paper Form N1 to local County Court). is there a deadline this must by done by? I am concerned about (a) missing a deadline, and (b) builder may wind up his limited-liability company in the meantime.
Expert:  Ash replied 9 months ago.
1) Ideally you need to be able to quantify your loss.
2) You have six years to bring a claim. Does that clarify? Alex
Customer: replied 9 months ago.
Thanks. Since he is a limited-liability company (newly setup), I would expect the company has little cash/assets to pay me if the court orders him to pay. I don't think he will have £15-20k within the company. Is there anything I can do to (a) become a creditor asap of the firm so that if he tries to dissolve the company, I appear as a creditor? and (b) to hold him personally accountable? is there a regulatory body / watchdog I can report him personally as director?
Expert:  Ash replied 9 months ago.
He is not personally liable. If he closes the company all you can do is complain to the Official Receiver and they may disqualify him as a Director. Apart from that unless he is a member of any trade bodies there is not much you can do. Does that clarify? Alex
Customer: replied 9 months ago.
how can I know who the Officer receiver is if he tries to dissolve the company?
Expert:  Ash replied 9 months ago.
Because the records at companies house will show this. Does that help? Alex
Customer: replied 9 months ago.
I am told that if the builder does not have funds to pay costs to us, despite court orders, then he might be ordered by the court to do Specific Performance jobs. does this happen, and what is the process for this ?
Customer: replied 9 months ago.
Another question - the builder is telling us he wants to go to arbiration. He seems to think that arbiration will go in his favour and he'll be able to renegotiate a new price for the remainder of the contract (he claims to have added higher specifications/tasks to the work done so far which increased costs, but he didn't inform/check these with us beforehand). So for example, if arbitrators agrees with him, he'll complete the remaining project if we pay an extra £10k for example. Do you think its a good idea to go to arbiration? do you think the arbitrator will agree with him (based on his claims) or will he re-iterate the original contract? also I understand that time for arbitration is a few months - is this correct?
Expert:  Ash replied 9 months ago.
Its up to you, its a commercial decision. Arbitration is cheaper than Court. It can take a year to get it to Court.Does that clarify?Alex
Customer: replied 9 months ago.
Thanks Alex, I am not familiar with the arbitration process (although we looked at it on the website). Do you think arbitration can rule in favor of the builder in the above circumstances? What about the contract with time line and cost?
Expert:  Ash replied 9 months ago.
No I dont think so. I think it will be in your favour based on what you have said.Does that help?Alex
Customer: replied 9 months ago.
Thank you for your replies Alex.1)We wrote him a letter of notice but he hasn't responded or returned to do the job within the time frame granted. Is it correct to say that we are in a position to file the MCOL form online?
2)Re, arbitration: Firstly is it binding? Secondly what happens if it goes in our favour but builder shows his company to be bankrupt? Would it maybe be that he may have to employ labour for the incomplete jobs and we may need to buy materials? lastly, can you please give some idea about time frame involved in the arbitration process.
Many thanks for your help.
Expert:  Ash replied 9 months ago.
1) Yes2) Only binding if the parties agree that it is. If builder is or becomes bankrupt sadly there is nothing you can do.Alex
Customer: replied 9 months ago.
Thanks, ***** ***** on time line for arbitration?
Expert:  Ash replied 9 months ago.
No time limit set.Does that clarify?If I could invite to rate my answer before you go today please, otherwise the site does not credit me for the time spent with you. Thanks in advance. Alex
Expert:  Ash replied 9 months ago.
If this answers your question could I invite you rate my answer 3, 4 or 5 starts before you leave today.I am only paid for my work on this question if you rate my answer, using the star system at the top of the screen. Please do not forget! Thank you.Please bookmark my profile if you wish for future help: http://www.justanswer.co.uk/law/expert-alexwatts/
Ash, Solicitor
Category: Law
Satisfied Customers: 10915
Experience: Solicitor with 5+ years experience
Ash and 3 other Law Specialists are ready to help you
Customer: replied 9 months ago.
Thanks Alex for your help. I haven't logged on in a couple of days. Will rate you now. If we need to contact you again, is it possible? thanks again.FYI, the builder appers to be coming back on track, and has returned to the job, although I expect the he will ask us to share costs of the materials needed to complete the job.
Customer: replied 8 months ago.
Hi Alex, Thanks for helping. quick question pls - if the value of the remaining project is substantial and his company doesn't have assets, can we initiate bankruptcy proceeding against builder / his company? He is slowly continuing work but I'm still asked to pay expenses / materials, but I don'tthink he can complete the job unless I keep paying more money.
Q2. How do we establish ourselves as a creditor formally against him/ his company?
Many thanks.
Customer: replied 8 months ago.
hi, I put in the above question last night on a request me again tab but didn't hear back so have reposed it here. Would appreciate your advice.

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