Do I Have to Pay a Contractor That Exceeds Their Estimate?
Contractors and homeowners have been going at each other for decades, if not centuries, over project estimates. When a contractor offers an estimate, he or she is making an educated guess based on figures and calculations determined by said contractor. Sometimes, though, there may be communication problems between the contractor and the homeowner that may hinder the final bid estimate, or the contractor may be incompetent, altogether. If you are working with a contractor and receiving an estimate, it is important that you understand both sides of the argument before proceeding.
Whether you must pay a contractor if they exceed their original estimate will depend on the existence of a written or verbal agreement. Many contractors will put in writing or explicitly say that their estimates are guesses of job costs based upon indefinite factors, such as weather, amendments to the original agreement or any other unforeseen occurrence. However, there will always be a gray area when it comes to determining the definition of each change in the original contract. Sometimes a contractor may tear out a wall or floor and find that there is more damage that what was determined earlier--something that could not have been known. In this case, you should work with the contractor to come up with a fair solution. On the other hand, if a contractor comes to you and tries to change a price on an original promise that has had no additional surprises, then you might consider nonpayment of the additional terms. For example, if a contractor tells you that he will pour your driveway for two thousand dollars, listing everything that he will do for that money, and then comes back to you asking for an additional one thousand dollars to hire an extra helper or pay an unexpected price increase in concrete, then you should not pay. This might suggest an incompetent contractor who did not do his homework before estimating your project. Although many contractors miss the mark when they are estimating a job, many of them will add an additional five percent to the estimate to cover any unforeseen costs or losses.
In the end, always get a written estimate that details everything that the contractor agrees to do. Look over the estimate and do some research on whether the promised work is enough to satisfy your requirements. You may even consider talking to other contractors about their approaches to the same job. Have several contractors give you an estimate, and talk to each about their promise.
And finally, remember that many contractors are honest and make honest mistakes. Use common sense when negotiating over a missed estimate. Try to be fair but smart.
- "Consultant & Independent Contractor Agreements;" Stephen Fishman; 2008