Three Little Pigs Construction Email, Episode 1, The Phantom Change Orders:
In 2/2004, I requested that the carport be converted to living space. Here is the reply from Dave Exline.
" I guess what I am saying is...don't get to carried away with expectations...I plan on building a beautiful home, but I
have to pass on any new price adjustments..
ie...adding on 138 sq ft of living space vs. the carport...this requires that we add one interior door, and one exterior
door or window...we also had to put straw, and paint and plaster..and additional sheet rock, plaster, paint..trim,
base...etc..etc...now...I can absorb a few of the changes...but....lets not get carried away... the current price I am
quoting for new homes is $162 a sq ft...that means the conversion of the carport should cost you $22,356....I am only
going to charge you for the doors ($"s depend on what you pick out)...and lumber/labor for the other walls, (about
$500)...
Dave says ".I am only going to charge you for the doors ($"s depend on what you pick out)...and lumber/labor for the other
walls, (about $500)..." Seems clear right? Not to Dave, 6 months later, Dave is trying to get me to pay $7500 for the carport
conversion. How does that work? Must be the 'new math' because I was never able to understand his rationale.
What is also interesting is that Dave Exline is explaining his decisions on installing heating in only 1/2 the house. Imagine if
you will, making sure the Laundry Room has heat, but not the Master bedroom. Make sense? To Dave Exline it did.
I can assure you that the unit he had installed, while over sized, does not heat the Master bedroom. Also, the County Inspector
'required' me to install a unit for the Bedrooms and Bath as documented here in the Official Inspection Card.
Note: if you and your contractor are quoting the contract, it is time for a new contractor.
This is uncensored and uncut Dave Exline...
_________________________________________________________________________________________
----- Original Message -----
From: dave @threelilpigs.com
To: Leslie Miley
Sent: Monday, October 25, 2004 5:08 PM
Subject: Re: Re:change orders
Hello...,
Well, another fly in the ointment I guess....I received the signed change orders just fine...need to discuss the
following...
I have not included change order 08404 for reasons which we have discussed previously. If you would like to review, please
call.
It has now been two months since this issue came up, and it is long past time to resolve it..
If you want a break down on the cost of the conversion, it will be in the neighbor hood of
$12,000. My hard cost to date are over $9500
and there is plaster and drywall, and insulation
to add into it...I am offering you the out at $7500,
I need to know just exactly what you will pay for the addition so that I know where to stop my work
efforts., or execute the change order as per the contract as a verbal change order with the appropriate cost and provisions
for profit and overhead....
6. Change orders shall be in writing and signed both by Owner and Contractor and shall be incorporated in and become part
of the contract. All changes shall add an additional 15% profit and overhead factor beyond labor and material cost. Where a
Verbal change order is executed, contractor will provide a written expense or credit memo at next billing cycle, and it shall be
incorporated and become a part of the contract.
For the record I would like to point out that change order 10504 is the result of:
a) The large center beam that was not in the original design and that owner was not notified of that change until after order
and placement of beam.the original beam was a 3.5"x 14" microllam, and I increased the size of the beam to a 6"x24"..to
permit more
space for insulation and dead air space. The owner was not notified of the change, as the contractor took it upon himself as a
matter of
structural significance and not aesthetics..the owner was not charged for the increased cost of over $1200 for the change.
b) The necessity of the change order 10504 is a direct result the center beam preventing appropriate HVAC from being
installed and subsequently not being able to run heating or cooling to the master bedroom and bath, guest bedroom and bath,
and theater room without addition of secondary unit.this is incorrect, as designed from the beginning, this would not have
been possible, and the Contractor provided the Owner with several heating options other than the secondary system charged
in change order 10504. The Contractor still believes that the house would have maintained the minimum requirements of both
County and State Title 24
requirements as the system installed is oversized from that required.
c) That owner was not notified of the contractors decision of not having heating or cooling in the above mentioned rooms
prior to work being started. The contractor did not consult with the owners in this regard, as the heating and cooling unit
being installed satisfied all the minimum requirements of County and State Title 24. The owner had previously expressed the
desire to reduce the cost of the project as much as possible, and the contractor felt that adding the additional funds required
for the change order would not be forthcoming from the owner, therefore it was not suggested. The contractor did advise
the owner that he felt that the house would operate well without the addition, and offered additional options of heating for the
northern section of the house, which the owners rejected in place of the change order.
We can have a discussion of whether or not heating/cooling is necessary in those rooms but the opinion of Dick from Left
Air was that at a minimum, heating should be installed due to the floor acting as a cold sink. As an owner concerned with his
investement, it would be irresponsible for me to not follow that advice.
It was Dicks educated guess that this would be required, but Dick does not really know the performance associated with
Straw Bale homes, and was suggesting one alternative. The Contractor suggested other heating options that were
substantially cheaper than the change order that was generated.
Let me know if you have any questions
P.S.
Please advise Janice that payment for the above change orders will be funded once rough framing inspection has been
completed.
I will let this slide for now..but our policy is that change orders are funded at execution of the change order...
Dick will want his money up front for the new system, so you need to look at that ASAP...as it is required prior to rough
framing inspection..
hope this helps to clarify both of our positions..
dave
_________________________________________________________________________________________
From: Leslie Miley <lesliehm@****.net>
To: dave @threelilpigs.com <dave@threelilpigs.com>, <lesliehm@***l.com>
Date: Oct 25 2004 - 6:27pm
Dave,
If we are to understand Article 5, Section 6 of the contract between Three Little Pigs and Leslie Miley, then we must accept
that the conversation we had in February of this year (documented in email dated 2/22/04) constituted a verbal change order.
"the current price I am quoting for new homes is $162 a sq ft...that means the conversion of the carport should cost you
$22,356....I am only going to charge you for the doors ($"s depend on what you pick out)...and lumber/labor for the other
walls, (about $500)..."
This states the work and the approximate price. I can provide you the full email if you need it.
Also Article 5, Section 2 states "Contractor agrees to coordinate with owners on aspects of decision making that regard the
overall aspect of the project, but contractor retains the right of final execution on project. In the two examples cited in my
previous email, owners were not informed of decision making aspects of the projects prior to execution.
Article 5, Section 2 was not followed in regards to the HVAC issue. Per my discussion with Dick from Left Air, he indicated
that he had originally quoted the house with 2 separate air/heating systems(and you acknowledged this in our conversation on
10/19). Three Little Pigs then instructed the HVAC sub contractor to install a system that did not have heating or cooling in
the master bedroom/bath, theater room, and Guest bedroom/bath, without notifying the owners. In fact, owner became
aware by visiting the site and speaking with the HVAC contractor.
Article 5, Section 2 was not followed in regards to the center beam. Owner was not notified of a significant change to the
roof, roof line, and interior ceiling until visiting the site and seeing the beam in place.
After reviewing the contract, and the circumstances described above, we as the owners believe:
1) The verbal discussion we had regarding the carport conversion and the subsequent quote you emailed on 2/22/04
constitutes a change order that we accepted. Subsequent change orders for $7500 have not been accepted or signed by the
owners.
2) Cost differentials are not the responsibility of the owners when Article 5, Section 2 is not followed. As evidenced by the
$1200 charge you did not pass on by changing the beam from 3.5"x 14" microllam to 6"x24".
As outlined in Article 6, Section 1, perhaps a cooling off period is in order as these issues need to be resolved.
Let me know what steps you would like to take.
Leslie