Did you know that your local power company is the worst offender of homeowner’s trees? In the sense that these tree men hired by the electric and phone companies will cut the tree so severely around telephone and powers lines than the tree becomes uneven. It other words, it is half a tree, branches on one side and no branches on the street side. More about this horror later, but before I go we need to stop this practice immediately.
Posted in My Landscaper Nightmares, Surreal News | Tagged bad tree pruning, electric company easements, over cutting trees, tree damages, trees | 2 Comments »
Lesson #1: Never, never, never place any trust in contractors, designers, landscapers, or anyone else in the home repair/renovation/building profession. In addition, do not trust web sites that promote their so called “screened” network of professionals. In my experience these anti-consumer web sites make their money charging monthly fees to contractors and subcontractors.
Lesson #2: Let them know you don’t trust them and treat them as though you are their bank, finance company and employer. The more money they want from you, the more information you need from them.
You need in your hand, not in their hands this kind of paperwork:
Licenses, Insurance, Bonds, Homeowner lien waivers, Worker compensation insurance, warranties, permits, etc.
The more money they want the more info you want from them. Make it a requirement to request their Personal Information such as home address, business address, home and business phone numbers, social security number, driver’s license number or copy of driver license.
Most likely they have all types of personal information on the homeowner, so they can easily come back and file a law suit against your assets. However without reliable and accurate information, it is almost impossible to file a law suit on the contractor and expect to recover their assets.
Lesson #3: Use a Private Investigator and/or background check search with criminal records search. Why trust ten thousand dollars or more to someone who you don’t know from Adam’s house cat? Many homeowners discover after the fact, that Mr. Crappy has a record of lawsuits and complaints. In the self made home renovation business, crime does pay. Don’t trust your home to anyone without investigating their business and criminal history.
Lesson #4: Prepare a project diary, with a camcorder, tape recorder, camera and/or journal of the project from start to finish. Purchase an inexpensive daily planner specially for the home project journal, and note every telephone call, missed appointment, face to face communication, etc in this planner. Always assume something will go wrong, and this journal record will be your best source of information if the project goes downs the toilet. Please kept receipts of every nail, brick, plank, etc that the contractor purchased. Don’t trust contractors to place the best quality materials in your home, because most likely they won’t and they depend on your ignorance and gullibility.
Lesson #5: Teach yourself first. Read and print the State building codes requirements. Learn the difference between cheap and superior building materials. Request proof of purchase receipts for everything. Specify in the contract that type of supplies and materials used in the project. Also specify that any changes or alterations must be homeowner approved first if not, then the contractor has defaulted on the agreement.
Lesson #6: Verbal agreements must become written and signed/dated agreements. If you decide to change the paint color, get that in writing. If you decide to plant ferns instead of dogwoods, get that in writing. Always remember what if I need to sue Mr. Crappy, without written proof it becomes my word against Mr. or Ms. Crappy’s words.
Lesson #7: Make sure the contractor complies with State or County building permit regulations. It is important to get these building permits filed with the city’s building office. The contract must specify that the contractor comes out of their pocket pay to repair any work that failed to meet State or County building codes.
Lesson #8: Never, Never, NEVER pay more than 20% upfront. Pay the balance only when the work is totally finished and approved, (if needed by the city building inspector). On thousand dollar or more projects, the contractors who require 50% upfront or want payment in full immediately after finishing are usually crooks. Stay away, far away from these Crappies.
I highly and strongly suggest opening a line of credit rather than using the contractor’s finance company. Financing the project always means the contractor gets everything upfront because the loan is linked to the work. Now suppose this, midway through the project something goes wrong, or your don’t approve of the way your contractor does their work. However you have already signed for the loan offered by the contractor’s finance company. To make a long story short, you got hooked big time. In contrast, with a line of credit you fully control when the money gets dispersed. If something goes wrong before the projects completes, then the contractors has to make it right to get paid by you. Also, if the contractor starts to bullying or decides to skip and miss appointments, then you have the power to fire Mr/Ms Crappy and keep your money.
Lesson #9: Reference letters and certifications don’t mean anything as far as a contractor reliability and integrity. Don’t be fooled by length of service or years of experience either. He or she may have 20 years experience cheating customers. Reference letters are easily faked, written by relatives, friends, spouses, ex-cell mates, whomever. Certifications represent participation in a series of professional/career courses. So what? I experienced some of the worst mistakes by certified Carrier HVAC technician and certified toxic mold re-mediators. Will the company or contractor provide a lifetime warranty on their work? Will they make right what they did wrong, at no cost to you? Can the homeowner file a claim against the contractor’s insurance? Never look over these seemingly minor details, because if something does go wrong, it will be you paying for the repairs.
Lesson #10: Don’t give into being bullied or charmed. Someone is trying to steal from you and they have no feelings about harming your family, health, pets, home, land and assets. Don’t sign anything based on their time-table. Take what ever time you need to make a decision and don’t get pulled into those limited time special discount prices or promotional offers.
Posted in Common Sense Wisdom, Homeowner and Consumer Information | Tagged advice, avoiding contractor scams, hiring contractors, homeowner protections | 5 Comments »
I can’t stress enough that honest contractors rarely exist and the dishonest ones that I present on these pages represent most of the crooks who front as contractors and skilled trade-workers.
It takes long time to get over the anger of getting cheated by home contractors because everyday you live with the mess they left. The Town Carpenter incident changed my health for the worst: my blood pressure increased so much that I had to undergo extensive and expensive cardiac examinations. The stress of everyday trying to cook meals in the mess left by Andy Luke caused another rage every day. In addition, his wife would call me, to say how sorry she felt and that she really needed some help finding a place to live. This family represents crappy-ness in abundance.
Once I finished paying another kitchen contractor, who repaired Andy’s crappy work, I filed a civil law suit with the Dekalb County clerks office on both parties: The Town Carpenter and Mr. Andy Luke. The Atlanta Better Business Bureau does not have any power to mediate complaints between customers and businesses. If they did, then our State legislator would enact stronger laws with criminal penalties for contractor scams. The BBB receives a very short complaint, the Business has 30 days to write a response. The BBB sends the business response to complainant and then for then on it become an email debate, between customer and business. I would guess that the BBB receives at least 300,000 complaints against contractors each year.
Every time I write a BBB complaint, I also mail a complaint to the Secretary of State’s office. Homeowners across America please use grass roots efforts to pressure our elected official to legislate criminal laws for contractor negligence and fraud. Let’s put these Crappies in Jail where they belong!!!
I seriously believe contractor dishonesty and negligence must become a State and Federal crime with at least five years in jail plus thousands of dollars in damages. I advocate for criminal prosecution because now, homeowners are defenseless against these crappy contractors. Our homes are ruined as well as our health, we must bear the costs of getting bad work corrected which often doubles the original cost, we may even suffer the loss of our homes, belongings and pets. In addition we pay a lot of money to attorney’s who basically seek big retainer fees plus one-third of the recovery costs. Insurance companies will fight against the homeowners for years in order to pressure you to sign nickel and dime out of court settlements that favor their interests only. Now tell me why should this type of homeowner hell not be considered a crime?
Magistrate Court of Dekalb County, Georgia, Civil Action #08M51368.
Defendants Gary P. Luke, dba The Town Carpenter and Andrew (Andy) W. Luke.
Statement of Claim: Breach of Contract, contractor fraud, misrepresentation and negligence. Failure to comply with terms of contract of May 3, 2008. Misrepresentation, intentional and negligent regarding ability to renovate, design, fabricate and install custom kitchen cabinets. Contractor fraud-contractor refused to complete kitchen project and to repair the numerous mistakes and damages after being paid in full.
Claim amount’ $6,500.00 plus filing fee.
I expected to see Mr. and Mrs. Gary Luke in court, but it surprised me to see Andy show. Dekalb County gives both parties the right to conduct their own private mediation meeting before seeing the Judge. It probably would have been better for Gary Luke to turn down the mediation and go before the Judge, because the Plaintiff, me bears the burden to prove to the Court the statement of the claim. Andy (Mr. Crappy) wanted to take full responsibility for everything. However he insisted that he did wonderful work for pennies on the dollar. So we settled for $5,171.25 including Court cost with future interest of 8% waived unless defaults. The settlement included a payment plan of $200 per month beginning in 30 days, payable to me on the 9th of each month. The Town Carpenter is dismissed with prejudiced.
A year later, I returned again to Magistrate Court to file a Writ of Fieri Facias, a Lien on Mr. Crappy, who defaulted on his payments less than year later. Mr. Crappy even conned his mother into making a few payments. The Court places an 8% interest on the Principal amount, so Mr. Crappy gets to pay more money as time goes by. Liens do not go away, unless I fail to renew them after seven years, but this Lien, for sure without any hesitation will get renewed forever. Legally, the Lien changed my status from homeowner to pseudo bounty hunter and now I can pursue legal remedies to seize salaries, bank accounts and other assets belonging to Mr. Crappy as well as pursue Mr. Crappy himself.
Posted in Crappy Contractor Woes | Tagged attorney, court, crime, law suits, liens, punishment | Leave a Comment »
The Town Carpenter’s Son
The Town Carpenter
5241-B New Peachtree Road
Chamblee, GA 30341
Office: 404-379-8317
E-mail: info@thetowncarpenter.com
http://www.thetowncarpenter.com/index.html
http://www.thetowncarpenter.com/gallery.html#
The title of this lesson in contractor swindles, is Never Trust Beautiful Business Web Sites. I would love to believe that a small owner business do better work than large companies, but the reality is with contractors it is six in one hand and half a dozen in the other when it comes to professional integrity.
We looked for months, seeking kitchen remodeling contractors. Contractors would draw up estimates and give us plans, but the conversational process would break down as soon as we requesting specific products. The owner of Paragon Construction, lost the kitchen contract when his subcontractors broke our bedroom ceiling by placing bags of insulation on the attic floor.
We visited Home Depot Expo and Lowe’s many times, and even had a kitchen plans with estimates prepared. Never hired Home Depot or Lowe’s but I heard that they use outside subcontractors and their cabinets are overpriced. A professional kitchen designer needs a retainer to work from, and these retainers may be $5,000 or $10,000.
Our kitchen is small, apartment size kitchen in home, with no room for kitchen table. So, it did not seem reasonable to spend $30,000 on cabinets alone. I wanted a floating island cabinet next to the range or cabinets that sat on legs so that I could clean the floor of crumbs and food particles.
IKEA, had the type of cabinets that I wanted, except they did not fit our kitchen. I tried unsuccessfully for four months to get the IKEA cabinets to fit the room. A co-worker suggested that we try a custom cabinet-maker to build the cabinets to fit in the room instead of buying pre-cut cabinets.
Great idea with the wrong cabinet-maker. Sometime in November 2006, I saw the Town Carpenter’s web page, contact them via emails and set up an in home visit.
The Town Carpenter owner is Mr. Gary Luke
Gary P. Luke – President/General Manager/Sales As founder of The Town Carpenter and its predecessor, Strictly Custom Interiors, Gary brings more than 15 years of business ownership and management experience to the firm. Earning his Journeyman Carpentry Certification in 1979, Gary also brings to the table over 25 years of carpentry and woodworking experience. Driving his company’s success on exceptional quality at a reasonable price, Gary Luke personally guarantees his customers’ satisfaction and stands behind each and every product. Gary lives in Atlanta with his wife and children.
Mr. Andy Luke, answered the phone and made an appointment to prepare a project estimate. Mr. Andy Luke, the Town Carpenter’s Son, in my opinion is a swindler and thief of the lowest rank. Andy represented himself as an authorized employee of the Town Carpenter with a lot of experience in cabinet design and fabrication. Andy does not have his own shop and claimed that he worked with his dad, i.e., father and son enterprise.
Before going further, I did not jump head first into doing business with this company. I got estimates from three other kitchen design centers. Also we needed a laundry pedestal for the new front loading laundry pair. Each pedestal, if purchase from the manufacturer would cost $230 each. We decided to get the pedestals made to save money. We hired The Town Carpenter to make two laundry pedestals for our front loading washer and dryer. Mr. Andy Luke made the pedestals, in the Town Carpenter’s shop and delivered them on time, $250.00 the total price for both pedestals.
The estimate Andy gave me, come in higher than the kitchen cabinet budget. So, I decided to use another company recommended by Paragon Construction, owner Mr. Bill James. This local company had a good selection of pre-made cabinets, however they did not have a rolling island and it would have voided the warranty to modify the cabinets.
Because we did not experience any problems with the laundry pedestal job, we figured to go ahead with the Town Carpenter design and installation. I called the Town Carpenter the third time in March or April 2007. Andy and I discussed at length all the things I wanted, he listened and told me all the things he could do for me, in addition he would add other things at no cost, such as counter height table for the microwave. He prepared a project sheet and explained that he needed half up front and half when the project was finished and that it would take him from start to finish 30 days and the installation would take him only 1 day.
This is the project sheet Andy wrote up:
Kitchen Contract and Project Sheet
Many contractors and skilled trades use these type of forms as contracts, project proposals and estimates, etc. One of the best plumbers, who has done work for my family and myself for more than 20 years used a project sheet as a contract for all his jobs. I accepted the proposal and agreed to the 50% deposit, which is a big, big mistake. Never agree to give any contractors more than 15% down-payment on any project. In addition, never agree to give any money without getting more information from the contractors, such as, his business license, complete home address and business address, liability insurance and a bond against defective work. I believe anytime a project cost more than $800, a homeowner should get a criminal records check of the contractor. Don’t rely on the absence of BBB complaints against the contractor, because swindlers change their business names and location, faster than they change their underwear.
Here is where everything falls through the rabbit hole, Mr. Gary Luke, owner of the Town Carpenter understood that his son worked on my kitchen cabinets. In fact, according the Gary, he gave Andy permission to do the project.
In March 2009 Andy approached me about doing a small kitchen telling me it was for the mother of his supervisor at Yellow Freight. Andy was planning to marry in early May and said he needed extra money for his wedding and honeymoon. He asked to use my production facility after normal business hours for what he claimed was a few kitchen cabinets. Though his request was against company policy, I said would consider it and later gave him permission to use the facility one time only. I would learn in July 2007 that the project was in fact for _______ _________, who has no ties to Yellow Freight or anyone there and was for an entire kitchen renovation, written by Mr. Gary Luke to the BBB on 5/12/2008, Case #27049141.
We paid Andy $2,637.50 March 2007. In May, he showed up with half the work finished. I had the entire kitchen, walls and floors removed and replaced, so that he could get the kitchen completed in one day. I pushed other subcontractors to get the room finished, so that Andy could install the cabinets on May 4, 2007. By May 3rd, Andy brings part of cabinets explaining that he needed more time, cause he worked another job, and that if I gave him more time, then he would discount the cost of project by 10% and build and design the kitchen cabinets with a rolling island and the microwave cabinet. Andy also wanted the rest of the money paid to him that day. In fact, he begged me for the money, with the plea he really needed it for personal reasons. Note of wisdom, be very careful when contractors asks for favors in the form of money and never pay for work before it is totally finished.
I decided to draw up another contract, that Andy signed and dated. Note of wisdom, swindlers don’t care about contracts, they will sign anything to get your money in their pockets.
Homeowner's Contract for Kitchen
June 2007, we still did not have a completed kitchen. Andy installed the cabinets and the trim but he left a 40% of the project incomplete. He kept asking for more time with the project, but he make and broke appointments every week. July 2007, we still not see any progress made on completing the kitchen or correcting problems with the installation, so I telephoned The Town Carpenter business line and spoke to the owner Mr. Gary Luke.
Mr. Gary Luke and I wrote several emails and he also visited my home along with his wife and another time with his production manager. I later learned from the court records, while Mr. Luke and I discussed the kitchen cabinets, that she used the opportunity to spy about our home and taking notes about the appearance of our office/den.
We basically wanted to get our kitchen finished and all the problems Andy’s caused corrected. We took the position that Mr. Gary Luke, gave permission to Mr. Andy Luke to work as an independent subcontractor from The Town Carpenter, that Mr. Gary Luke knew that Mr. Andy Luke answered the business line for the purpose of stealing clients and that Mr. Gary Luke knew about our kitchen project. Nonetheless, Mr. Gary Luke failed to protect his customer and clients and therefore he holds total responsibility to correct all problems without any cost to us.
Mr. Gary Luke wanted us to pay him $867.06 to complete the project and correct problems. From July 2007 to April 2008 we still did not have kitchen finished. We had other kitchen cabinet makers look at Andy’s work and discovered that Gary had missed telling us about certain problems with the cabinets. Andy had made the range hood cabinet the wrong size, which caused the range hood to sit too low about the range, as a result the burner flames had started to melt the hood lights. We also spoke to several attorneys, who advised us to give Town Carpenters an opportunity to correct the problems at no cost to us and if they did not then file a lawsuit against the company owners and Mr. Andy Luke.
June 9, 2008, I filed a complaint with the Dekalb County, Magistrate Court, Case # 08M051368. Statement of Claim
Breach of contract, contractor fraud, misrepresentation and negligence. Failure to comply with terms of contract of May 3, 2007. Misrepresentation, intentional and neglient regarding ability to renovate, design, fabricate and install custom kitchen cabinets. Contractor fraud, contractor refused to complete kitchen project and to repair the numerous mistakes and damages, after being paid in full.
We hired another kitchen remodeling company to finish the work.
Cost More to Repair Bad Work
To be continued the story is not finished.
Posted in Crappy Contractor Woes | Leave a Comment »
Renovating In A Recession: Why It Could Cost You More If You Don’t Protect Yourself With These 7 Key Clauses In Your Contract
With demand for residential construction still in a slump and contractors holding on for the tides to turn, folks are being told that this a great time to strike up a deal on that home renovation project. After all, materials costs are down and contractors are willing to pass on those savings and even perhaps cut back on their own profit to compete for your business. But at what cost to the consumer is that great deal really costing? And is it safe to assume that the contractor will actually cut back on his own earnings just for the work?
In a nutshell – no it’s not and here’s why. Times like these are prime breeding ground for less than ethical contractors to take advantage of unassuming homeowners looking for that great deal who will only look at the bottom line, give a quick once-over to what’s in the contract and “trust” that they are getting that great deal – what with the economy giving them this great opportunity to take advantage of – when in fact it’s THEM that’s getting taken advantage of!
Here’s what a less than ethical contractor hopes the homeowner DOESN’T know:
—> 1.) His bid doesn’t include everything your specifications sheet calls for, but rather makes vague references to specific items. The homeowner doesn’t know how critical it is to cover in detail every single item expected to be included and performed in the spec sheet and “trusts” that what he said he’d do, he’ll do.
Result: The homeowner gets hit with “extra work” invoices for items they thought were in the contract.
Lesson: Get educated on creating thorough spec sheets, reading bids carefully by line items and expect change orders but on your terms. Which brings us to:
—> 2.) Change Orders: Write into the contract that any “extra work” must be approved in the form of written Change Orders, which are agreed to and signed by both the homeowner and contractor before work is performed and added to the total contract price if the contractor expects to be paid for it.
—> 3.) Lien Release Waivers: You pay the contractor who in turn pays his subs and suppliers, but at the end of the project the homeowner discovers the contractor didn’t pay one or more subs or suppliers
Result: The homeowner gets slapped with Mechanics Liens where they will end up paying twice for work they thought had been paid for by the contractor. It’s either pay up or hire an attorney to try and reason with the contractor – or sue.
Lesson: Write into the contract that Lien Release Waivers are required upon each payment made to the contractor, and must include releases from the subs and suppliers as well.
—> 4.) The contractor agrees to pull the permits and takes payments that cover those costs. A couple of months later problems start to crop up, communication with the contractor becomes strained and in an attempt to get to the truth the homeowner contacts the city only to find out he never pulled the permits!
Result: The homeowner ends up paying fines to the city, has to pull and pay for the necessary permits, may have to tear out work for inspections that should have been performed and will never get the money back from the contractor for the initial permits paid for, but never pulled. The homeowner ASSUMED the contractor would pull the permits but never saw the permits or thought to ask for them.
Lesson: Have it written into the contract that the contractor is to obtain all necessary permits, provide you with the permit documents to post and provide you with the receipts paid to the city for your records.
—> 5.) The contractor’s work is substandard but you can’t get him to correct much less acknowledge that there are problems.
Result: You’re stuck with poor workmanship, and an unpleasant even contentious relationship with the contractor. At your wits end you fire him but then get sued for breach of contract.
Lesson: Have a Cancellation or Termination Clause written into the contract that allows the homeowner to fire for substandard work, deviation from the contract and scope of work or illegal activity.
—> 6.) The contractor asks for a large upfront payment with 2 more payments at specific milestones.
Unbeknownst to the homeowner, the contractor is getting more money than work is being performed, right from the start. Eventually over time, he and his crew stops coming regularly or not at all. You suspect – and rightly so –that your money is being used on someone else’s project.
Result: When the homeowner realizes he/she has paid for work that has not been performed and when finally tracking down the contractor, he/she makes excuses or asks for more money. Very often the contractor has moved on to another project with your money in hand. The homeowner gets put off by the contractor and is forced to hire an attorney.
Lesson: Put together a more frequent payment schedule that requires invoices that details work that has been performed, supplies and materials used with costs to date and showing those cost deducted from the total contract price. Research your State’s law regarding down payment limits or consult with a construction law attorney to verify a reasonable down payment.
—> 7.) During demolition, the contractor discovers an unforeseen problem, i.e., termite damage on existing wood members and immediately recommends a solution, which is costly, but needs to be done immediately in order to move forward. (Or, goes ahead and makes the fix then presents you with the reason and the bill after the fact.)
Result: The homeowner has no idea that there may be a more cost effective solution but this is an opportunity for a contractor to legitimately add extra costs that are more profitable for him.
Lesson: Include an Unforeseeable Work Clause in the contract that states that the owner must be given prior notice before any “unforeseen” work is performed. Include the right to obtain other bids for the work to ensure you are not paying a higher than normal cost.
Consumers can learn more about protecting themselves by visiting the ContractorsFromHell.com and enrolling in the Home Remodeling Bootcamp For Homeowners. The Home Remodeling Boot Camp, an online membership site created by Jody Costello, founder of ContractorsFromhell.com, is designed to teach consumers to be their own best advocate and in control of their project. Engaging homeowners to do the necessary homework, giving them the tools and information to help them choose their contractor wisely, will help mitigate the most common problems encountered when hiring and working with contractors
Posted in Homeowner and Consumer Information | Leave a Comment »
The Importance of Surety Bonds in Construction
Historical Perspective
Surety bonds have been a valuable tool for centuries. The first known record of contract suretyship was an etched clay tablet from the Mesopotamian region around 2750 BC. According to the contract, a farmer drafted into the service of the king was unable to tend his fields. The farmer contracted with another farmer to tend them under the condition they split the proceeds equally. A local merchant served as the surety and guaranteed the second farmer’s compliance.
Suretyship was addressed in the first known written legal code, the Code of Hammurabi, around 1792–1750 BC. A Babylonian contract of financial guarantee from 670 BC is the oldest surviving written surety contract. The Roman Empire developed laws of surety around 150 AD that exist in the principles of suretyship today.
While suretyship has a long history, it wasn’t until the 19th century that corporate surety bonds were used. Recognizing the need to protect taxpayers from contractor failure, Congress passed the Heard Act in 1894, which required surety bonds on all federally funded projects. The Miller Act of 1935 (40 U.S.C. Section 270a et. seq.) was the last major change in public sector surety, and is the current federal law mandating surety bonds on federal public works. It requires performance bonds for public work contracts in excess of $100,000 and payment protection, with payment bonds the preferred method, for contracts in excess of $25,000. Almost all 50 states, the District of Columbia, Puerto Rico, and most local jurisdictions have enacted similar legislation requiring surety bonds on public works. These generally are referred to as “Little Miller Acts.”
Risky Business
How one evaluates and manages risk on construction projects and makes fiscally responsible decisions to ensure timely project completion is key to success. To gamble on a contractor whose level of commitment or qualification is uncertain or who could become bankrupt halfway through the job can be a costly decision. How can a public agency using the low-bid system in awarding public works contracts be sure the lowest bidder is dependable? How can private sector construction project owners manage the risk of contractor failure?
Surety bonds provide financial security and construction assurance by assuring project owners that contractors will perform the work and pay specified subcontractors, laborers, and material suppliers. A surety bond is a risk transfer mechanism where the surety company assures the project owner (obligee) that the contractor (principal) will perform a contract in accordance with the contract documents.
Types of Bonds
There are three basic types of contract surety bonds:
The bid bond assures that the bid has been submitted in good faith and that the contractor will enter into the contract at the price bid and provide the required performance and payment bonds.
The performance bond protects the owner from financial loss should the contractor fail to perform the contract in accordance with its terms and conditions.
The payment bond assures that the contractor will pay specified subcontractors, laborers, and material suppliers on the project.
Financial Security & Construction Assurance
Although surety bonds are mandated by law on public works projects, the use of surety bonds on privately owned construction projects is at the owner’s discretion. Alternative forms of financial security, such as letters of credit and self-insurance, do not provide the 100% performance protection and 100% payment protection of surety bonds nor do they assure a competent contractor. With surety bonds, the risks of project completion are shifted from the owner to the surety company. For that reason, many private owners require surety bonds from their contractors to protect their company and shareholders from the enormous cost of contractor failure. To bond a project, the owner specifies the bonding requirements in the contract documents. Obtaining bonds and delivering them to the owner is the responsibility of the contractor, who will consult with a surety bond producer. Subcontractors may also be required to obtain surety bonds to help the prime contractor manage risk, particularly when the subcontractor is a significant part of the job or a specialized contractor that is difficult to replace.
Most surety companies are subsidiaries or divisions of insurance companies, and both surety bonds and traditional insurance policies are risk transfer mechanisms regulated by state insurance departments. However, traditional insurance is designed to compensate the insured against unforeseen adverse events. The policy premium is actuarially determined based on aggregate premiums earned versus expected losses. Surety companies operate on a different business model. Surety is designed to prevent loss. The surety prequalifies the contractor based on financial strength and construction expertise. The bond is underwritten with little expectation of loss.
Prequalification of the Contractor
Sureties are able to accept the risk of contractor failure based on the results of a thorough, rigorous, and professional process in which sureties prequalify the contractor. This prequalification process is an in-depth look at the contractor’s business operations. Before issuing a bond the surety company must be fully satisfied that the contractor has, among other criteria:
Good references and reputation;
The ability to meet current and future obligations;
The experience matching the contract requirements;
The necessary equipment to do the work or the ability to obtain it;
The financial strength to support the desired work program;
An excellent credit history; and
An established bank relationship and line of credit.
The surety company must be satisfied that the contractor runs a well-managed, profitable enterprise, keeps promises, deals fairly, and performs obligations in a timely manner. Surety bonds have played an important role in the construction industry’s success, allowing the industry to sustain its position as one of the largest contributors to the nation’s economic stability and growth.
Contractor Failure
Construction is a risk-filled enterprise, and even capable and well-established contractors can ultimately fail. According to BizMiner, of the 1,155,245 general contractors and operative builders, heavy construction contractors, and special trade contractors operating in 2006, only 919,848 were still in business in 2008—a 20.37% failure rate. Despite the surety’s rigorous prequalification process and best judgment about the qualifications of the contractor, sometimes contractor default is unavoidable. However, when a contractor fails on a bonded project, it is the surety company that remedies the default—not the project owner and not at taxpayers’ expense.
In the unfortunate event that a bonded contractor does default, the surety has legal obligations to the project owner and the contractor. First, the owner must formally declare the contractor in default. Then the surety company conducts an impartial investigation before settling any claim. This protects the contractor’s ability to pursue legal recourse in the event that the owner improperly declares the contractor in default. When there is a proper default, the surety’s options often are spelled out in the bond. These options may include the right to re-bid the job for completion, bring in a replacement contractor, provide financial and/or technical assistance to the existing contractor, or pay the penal sum of the bond.
Bond Rates
Surety bond premiums vary from one surety to another, but can range from 0.5% to 2% of the contract amount, depending on the size, type, and duration of the project and the contractor. Typically, there is no direct charge for a bid bond. In many cases, a performance bond incorporates the payment bond and a maintenance period.
The contractor includes the bond premium amount in the bid and the premium generally is payable upon execution of the bond. If the contract amount changes, the premium may be adjusted for the change in contract price. Contract surety bonds are a wise investment— protecting public owners, private owners, lenders, and prime contractors from the potentially devastating expense of contractor and subcontractor failure.
Benefits of Bonds
After analyzing the risks involved with a construction project, consider how surety bonds protect against those risks. Owners, lenders, taxpayers, contractors, and subcontractors are protected because:
The contractor has undergone a rigorous prequalification process and is judged capable of fulfilling the obligations of the contract;
Contractors are more likely to complete bonded projects than non-bonded projects since the surety company may require personal or corporate indemnity from the contractor;
Subcontractors have no need to file mechanic’s liens on a private project when a payment bond is in place, and because mechanics’ liens cannot be placed against public property, the payment bond may be the only protection these claimants have if they are not paid for the goods and services they provide;
Bonding capacity can increase a contractor’s or subcontractor’s project opportunities;
The surety bond producer and underwriter may be able to offer technical, financial, or management assistance to a contractor; and
The surety company fulfills the contract in the event of contractor default.
Any contractor—whether in business for one year or 100, large or small, experienced or novice—can experience serious problems. Through the years surety bonds have held fast as a comprehensive and reliable instrument for minimizing the risks in construction.
10 THINGS YOU SHOULD KNOW ABOUT SURETY BONDING
Making the right choice to mitigate and manage risk on construction projects and selecting the most fiscally responsible option to ensure timely project completion are imperative to a successful project – and a sound business. Gambling on a contractor or subcontractor whose level of commitment is uncertain or who could become bankrupt halfway through the job can be an economically devastating decision. Surety bonds offer the optimal solution: providing financial security and construction assurance by assuring project owners that contractors are capable, in the surety’s opinion, of performing a construction contract and paying specified subcontractors, laborers, and material suppliers.
A surety bond is a three-party agreement where the surety company assures the obligee (owner) that the principal (contractor) will perform a contract. Surety bonds used in construction are called contract surety bonds.
There are three primary types of contract surety bonds. The bid bond assures that the bid has been submitted in good faith, that the contractor intends to enter the contract at the price bid and provide the required performance and payment bonds. The performance bond protects the owner from financial loss in the event that the contractor fails to perform the contract in accordance with its terms and conditions. The payment bond assures that the contractor will pay certain workers, subcontractors, and materials suppliers.
Most surety companies are subsidiaries or divisions of insurance companies, and both surety bonds and insurance policies are risk transfer mechanisms regulated by state insurance departments. However, insurance is designed to compensate the insured against unforeseen adverse events. The policy premium is actuarially determined based on aggregate premiums earned versus expected losses. Surety companies operate on a different business model. Surety is designed to prevent loss. The surety prequalifies the contractor based on financial strength and construction expertise. The bond is underwritten with little expectation of loss.
In 1984 Congress passed the Heard Act to protect federal projects from contractor default and protect subcontractors from nonpayment by contractors. The Heard Act was supplanted by the Miller Act in 1935, which basically requires performance and payment bonds in excess of $100,000 and payment protection for contracts between $30,000 and $100,000. A corporate surety company issuing these bonds must be listed as a qualified surety on the Treasury List. Also, almost all 50 states, the District of Columbia, Puerto Rico, and most local jurisdictions have enacted similar legislation requiring surety bonds on public works. These generally are referred to as “Little Miller Acts.” Owners of private construction also manage risk by requiring surety bonds.
Construction is a risky business. Of 1,155,245 contractors in business in 2006 only 919,848 were still in business in 2008 – a 20.4% failure rate. Surety bonds offer assurance that the contractor is capable of completing the contract on time, within budget, and according to specifications. Specifying bonds not only reduces the likelihood of default, but with a surety bond, the owner has the peace of mind that a sound risk transfer mechanism is in place. The burden of construction risk is shifted from the owner to the surety company.
Surety bond premiums vary from one surety to another, but can range from 0.5% to 2% of the contract amount, depending on the size, type, and duration of the project and the contractor. Typically, there is no charge for a bid bond if performance and payment bonds are required on the project. In many cases, performance bonds incorporate payment bonds and maintenance bonds.
The surety company’s rigorous prequalification of the contractor protects the project owner and offers assurance to the lender, architect, and everyone else involved with the project that the contractor is able to translate the project’s plans into a finished project. Surety companies and surety bond producers have been evaluating contractor and subcontractor performance for more than a century. Their expertise, experience, and objectivity in prequalifying contractors is one of a bond’s most valuable attributes. Before issuing a bond, the surety company must be fully satisfied that the contractor has, among other criteria:
- good references and reputation;
- the ability to meet current and future obligations;
- experience matching the contract requirements;
- the necessary equipment to do the work or the ability to obtain it;
- the financial strength to support the desired work program;
- an excellent credit history; and
- an established bank relationship and line of credit.
Contractor default is an unfortunate, and sometimes unavoidable, circumstance. In the event of contractor failure, the owner must formally declare the contractor in default. The surety conducts an impartial investigation prior to settling any claim. This protects the contractor’s legal recourse in the event that the owner improperly declares the contractor in default. When there is a proper default, the surety’s options often are spelled out in the bond. These options may include the right to re-bid the job for completion, bring in a replacement contractor, provide financial and/or technical assistance to the existing contractor, or pay the penal sum of the bond. That owners have been shielded from risk is evidenced by the fact that surety companies have paid more than $10.5 billion due to contractor default since 1994, according to The Surety & Fidelity Association of America, Washington, DC. In 2008, the surety industry paid more than $13 million in losses on private construction and more than $1.5 billion since 1995.
When bonds are specified in the contract documents, it is the contractor’s responsibility to obtain them. The contractor generally includes the bond premium amount in the bid and the premium generally is payable upon execution of the bond. If the contract amount changes, the premium will be adjusted for the change in contract price. Contract surety bonds are a wise investment – providing qualified contractors and protecting public owners, private owners, and prime contractors from the potentially devastating expense of contractor and subcontractor default.
After analyzing the risks involved with a construction project, consider how surety bonds protect against those risks. Owners, lenders, taxpayers, contractors, and subcontractors are protected because:
- The contractor has undergone a rigorous prequalification process and is judged capable of fulfilling the obligations of the contract;
- Contractors are more likely to complete bonded projects than non-bonded projects since the surety company may require personal or corporate indemnity from the contractor;
- Subcontractors have no need to file mechanics’ liens on private projects when a payment bond is in place;
- Bonding capacity can help a contractor or subcontractor grow by increasing project opportunities and providing the benefits of assistance and advice of the surety bond producer and underwriter;
- Surety companies may prevent default by offering technical, financial, or management assistance to a contractor; and
- The surety company fulfills the contract in the event of contractor default.
For more information about surety bonding, please contact the: Surety Information Office www.sio.org | sio@sio.org
The Surety Information Office (SIO) is the information source on contract surety bonds in public and private construction. SIO offers brochures and CDs and can provide speakers, write articles, and answer questions on contract surety bonds. SIO is supported by The Surety & Fidelity Association of America (SFAA) and the National Association of Surety Bond Producers (NASBP). All materials may be accessed at www.sio.org.
Surety Bonds: It’s Not What You Think
When it comes to home remodeling or renovating some part of your home, the first time a homeowner usually becomes familiar with the term “surety bond” is when problems with the contractor have come up.
It’s also a time when the homeowner may find that the general contractor has no liability insurance and now has only the surety bond to look to for help in recovering damages such as shoddy workmanship or abandonment of the project. Unfortunately, the news is not good.
First and for most, a surety bond IS NOT an insurance policy but rather a guarantee whereby the surety guarantees that the contractor (called the principal) will perform the obligation stated in the bond.
There are a number of bond types available but for the purpose of home remodeling and improvements there are three that would apply:
• Contractor Licensing Bonds
• Performance Bonds
• Payment Bonds
Let’s address Payment and Performance bonds first, as they are usually the least utilized by homeowners in their home improvement projects and carry a little more protection for homeowners.
Generally, Performance Bonds guarantee the completion of the project according to the building plans and specifications. If the job is abandoned or the work is unacceptable, the bonding company has the option of hiring another contractor to complete the work or settling for damages.
Payment Bonds assures the owner that no liens for labor or materials will be filed against the property as payment is guaranteed. In both cases the homeowner pays a percentage of the contract price to obtain the surety bond and becomes the obligee of the surety.
There are many complexities to these bonds not covered here that you would want to know if considering either of these bonds. If you’d like more information be sure to follow the links at the end of this article and do your research.
The most common surety bond homeowners get involved with is the Contractor License Bond, typically as a result of the contractor violating some aspect of the Contractors License Laws.
In California, contractors are required to post some form of security deposit with the Contractors State License Board and surety bonds are typically used for this purpose although cash or certificate of deposits may also be posted.
In this scenario, a surety bond is a contract in which the surety company promises the State of California that the contractor will comply with the provisions of the Contractors State License Law (CSLL) – Chapter 9 of Division 3, starting with section 7000 of the Business and Professions Code. The contractor’s “obligation” in this case is to NOT commit any violations of the CSLB that are grounds for disciplinary action against the license. The law sets forth specific violations, which the bond will cover.
If the contractor does not comply with the conditions of the bond, a consumer and/or employee may file a claim against the bond. (B&P Code Section 7071.5) The amount of the surety bond for general contractors in California is $12,500. (Other states vary in the required amounts.)
That’s $12,500 for ALL the jobs the contractor has going, not per project. So imagine if there are several individuals who for various reasons file a claim against that one bond. Very often damages per project exceed the entire dollar amount of the bond, let alone becoming available to the multitudes.
It’s just not going to happen, which is why homeowners need to be sure their contractor of choice carries liability insurance. So once that bond is depleted the contractor must renew the bond as well as pay back the money lost to the surety in order to keep his or her license. If a complaint has also been filed with the Contractors’ State License Board (which typically is the case) an independent investigation will be conducted by the Board or regulatory agency in addition to the surety company to determine if any violations occurred.
The contractor may be cited or even loose his/her license depending on the violations. It’s not a speedy process by any means and can be frustrating to the harmed homeowners not familiar with the process but needing to get on with repairs.
The important point that homeowners need to understand is that even if the contractors license board determines violations have occurred and the contractor is cited or even revoked, that doesn’t necessarily mean that the Surety will follow suit. Their terms of determining whether a pay out is justified is not dependent on what the Board deems is a clear violation of the CSLL.In other words, the surety company will determine if it will pay the claim and the Contractors Board will decide if disciplinary action or other resolution of the complaint is appropriate.
“Now this is where it gets sticky and very often consumers get slapped in the face by the surety company with a “no pay out” based on their own investigation of the facts even though their contractor was found to be in violation of the Contractors License Laws by the board. And that’s because the surety has an obligation to their principal – the contractor – to ensure that his/her license (and money!) is protected and not suspended. Their risk is very real and can quickly be consumed if not fervently protected, which is why their jurisdiction of what is “reasonably clear” is often at odds with what the CSLB determines.”
The surety companies will tell you that they serve both the bond claimant and the contractor but that’s just garbage. They serve the contractor, period. You cannot “serve two masters”, as one will always get the short end of the stick and that’s the homeowners.
“Many consumers have shared their frustrations with being denied pay out from surety companies even though clearly the contractor violated the license laws, damages were documented and disciplinary action pursued. It’s a no win fight as the surety companies have their so-called jurisdiction legally worded to protect their own. It’s simply not equitable no matter how much they deny it but then again, aren’t we Americans used to getting (ahem) hosed by now?”
Given that warning and using the California Contractors State License Board explanation on surety bonds, who benefits from the bond and how a homeowner files a claim against a surety bond follows:
Persons who can make a claim against the bond are listed in the CSLL (B&P Code Section 7071.5), and include:
a. Any homeowner contracting for home improvement work on the homeowner’s personal family residence damaged as a result of a violation of the CSLL by the licensee.
b. Any person damaged as a result of a willful and deliberate violation of the CSLL by the licensee, or by the fraud of the licensee in the execution or performance of a construction contract.
c. Any employee of the licensee damaged by the licensee’s failure to pay wages.
d. Any express trust fund damaged as a result of the licensee’s failure to pay fringe benefits for eligible employees.
How would a consumer file a claim against a bond?
In California, a consumer consults the CSLB’s Web site for information about the bonding company that wrote the surety bond covering the dates of the contract and the dates of the construction. Otherwise, contact your states Licensing Board for obtaining surety bond information on the contractor.
The consumer contacts the surety company, providing it with a written narrative describing the problem in detail, and attaching a copy of the contract and all other pertinent documents and information.
If a consumer is not satisfied with the response of the surety company, the consumer may take the contractor and the surety company to Small Claims Court for amounts up to $5000 against the contractor. The court can order the surety to pay up to $4,000. (Code of Civil Procedure Section 116.220(c)). Claims above $5,000 must be filed in Superior Court. (See the CSLB publication, A Consumer Guide to Filing a Small Claims Court Construction Claim.)
Be sure to visit your States regulatory agency, consumer protection division or local building departments for more information on surety bonds. In California, you can go to the CSLB web site and read up on surety bonds as well as more information on contractors and licensing requirements.
Jody Costello is a Consumer Advocate and publisher of ContractorsFromHell.com. As a result of a home remodeling nightmare she created ContractorsFromHell.com to help others avoid the problems her family encountered. Over the last nine years she has helped homeowners deal with problems as well as providing tips and resources. Working with the Contractors State License Board over the years, Costello helped to create greater protection and a voice for consumers and has testified before the State Senate supporting legislation protecting consumers. Go to http://www.contractorsfromhell.com
Source/Links:www.sba.gov/financing/bonds/whatis.html
© 2000-2009 Contractorsfromhell.com LLC
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Deceivers and CON-tractors, always look wonderful in the beginning, because they have big plans for spending your money. The con generally begins with the assurance that they above anyone else will give the best service at a low price. The paperwork looks wondeful, these guys come prepared with professional designed web sites, contracts, professional certifications and memberships, pamphlets, brochures, reference letters, insurance documents, neat uniforms imprinted with their business logo and the Better Business Bureau seal of approval. The package is tight, slick and totally aimed at geting thousands of your dollars into their wallets and purses. Once they get your name on the contract, then real fun and games begin for them, not you. It will be your nightmare for years.
EMER-X
Mr. Dave Michal, owner
Mr. Jeff Jones, manager
450 Satellite Blvd, Suite F
Suwanee, GA 30024
Phone: 770-932-8300
I hired a very large well known National company to install two casement windows in my den. Being very naive, I had no idea that this major corporation would use inexperienced sub-contractors. Their subcontractor’s negligence and ignorance resulted in my home being invaded with water inside the windows and through the sheetrock. The water trapped inside the wall produced a wonderful habitat for mold, the bad and dangerous kind of mold to thrive. Once, I discovered that my insurance company Allstate did not cover claims against a contractor and mold damage, I consulted with an attorney. I could not locate the subcontractor so I filed a claim with the company’s Home Improvement Repair and Services division. After months of inspections and reports, I finally got to the point of hiring a contractor to repair the home. The attorney I consulted recommended EMER-X. I called EMER-X and three other mold and renovation specialist. Based solely on the attorney recommendation in addition to their slick packaging, I hired EMER-X for the renovation project. The following letter explains the rest of the story with these CON-tractors.
November 19, 2004
Ms. Jennifer Warren
Dispute Resolution Manager
BBB Metro Atlanta
503 Oak Place #590
Atlanta, GA 30349
Dear Ms. Warren:
I am responding to your request of November 17, 2004 “to provide additional documentation to substantiate your claim.” My responses refer in part to Mr. Jeff Jones, (alias “Jeff Charles”) letter of November 4, 2004.
Mr. Terry Powell worked with me as the project manager from November 2003 to February 2004. Powell resigned from the staff of Emer-X shortly after my project began. Powell and I had several conversations about the lawn, the inventory, packing, biohazard gear and my car in the driveway. These conversations were in person, on the phone or by e-mail (E-mails enclosed). Jones did not hear these conversations.
I owned a 1989 Buick Regal Limited. My Allstate agent is Mr. Ty Crowe. Allstate recommended that since the car was not being driven to leave the car in the driveway. The car tag and insurance expired in 2004. The car had insurance and a current tag in place when Emer-X began the project in 2003. This was not a wrecked or abandoned junk vehicle because I listed and advertised the car for sale.
Powell and I discussed moving the car to the side of the house. This plan would not work because the yard is sloped and we were concerned that placing the car on a slope would cause problems when I tried to move the car. Therefore both of us agreed to leave the car in place for the time being. His workers would only use a small portion of the yard. The Saint Thomas Moore Catholic charity picked up the vehicle as a good will donation. Therefore the driveway was not blocked during the entire project.
I argue that this project did not require the total destruction of the entire lawn (Photos enclosed). The pictures of November 2003 show that I had a weed free fescue green lawn and room in the driveway for placement of a construction Dumpster. The pictures of August 2004 show that Emer-X never placed a construction Dumpster in the driveway or on the street. Instead their workers for weeks piled all the construction trash on the lawn. This debris remained in the yard for months. In addition paint wastes was dumped around the shrubbery in the front yard.
Emer-X removed all the carpets and rugs from the house. (The wood floors were protected for over 35 years with padded carpet and large area rugs). Their workers walked on the bare hard wood floors before and after cleaning the house of mold. The foot traffic on the floors severely marred the wood grain. The floors received damages far beyond normal wear and tear.
Powell suggested that I address the issue of the lawn and other damages with Dave Michal and Li****y M***al Insurance Company (The insurance company responsible for paying the claim). Li****y M***al’s agent W****ce B******u refused to pay for any damages caused by Emer-X. His position is that Emer-X could have prevented or reduced the amount of damages if they had taken certain protective measures during the project repairs. Dave Michal the owner of Emer-X agrees that his company did many things that negatively impacted my home. However he does not want to pay to repair any damages and does not want me to file a claim with Emer-X’s insurance company. Therefore he is withholding the correct name of Emer-X’s insurance carrier. Emer-X does not have insurance with St. Paul Travelers Insurance.
Although the focus of the BBB complaint does not pertain to project delays, I will address Jones dishonest responses in the following paragraphs. The inventory project began with Terry Powell. Jones did not hear these conversations and was not involved in the work that I did with Powell.
Powell wanted me to enter the house during the inventory and packing to remove all items of value. He did not want the company held responsible for storing valuables (Inventory agreement enclosed). I agreed to do this. Powell told me that I needed to wear biohazard protective gear, i.e., a facemask, gloves and coveralls. I do not work in the industry of cleaning biohazard wastes and this made it very difficult for Powell and me to locate not only the companies that sold to the public but also a physician who gave face mask respiratory tests. I believe it took over one month to set locate the professionals, get the appointments and finalized the mask testing. I caused none of these delays.
It was not necessary for me to work with the crew of Emer-X. Powell and I had a plan whereby he would leave things in the dining room for me to sort. Emer-X’s workers were not needed in the house during this project. In our plan, I would place the things I wanted to keep on a shelf in the dining room and the things I did not want to keep I placed in the living room. Powell suggested that it would be better to sort out in the beginning all the items that I wanted to keep from the items that I did not need to keep. This would have prevented the storage of unnecessary household goods and valuables.
I entered my house wearing biohazard gear, about six times for a total of 12 hours. On my last visit I had about five boxes out of 20 left to sort in the dining room. On the last day that I scheduled to come by and complete the inventory sorting, I surprisingly found that my entire house had been packed up and moved out. When the Emer-X workers moved all the contents to the warehouse, they removed the discard/contaminated contents and the contents that I wanted cleaned and retained. (They neglected removing the mold contaminated cookware from inside the gas range.)
Sorting through the contents before storage would have reduced the number of boxes placed in the warehouse. After two weeks of trying to finish the project inside my house Powell admitted to me that he did not know which boxes workers removed out of the dining room. In February 2004 Powell said that I could finish the project inside the warehouse but I should definitely not attempt to do this until they completed all the home repairs. However, in October 2004, Jones told me that I needed to make arrangements to pick up all my property from the warehouse or he would dump everything on my front yard. Also, he refused to allow me access to the warehouse so that I could complete the sorting of the discard items. I alleged they swindled to get a larger number of boxes in their warehouse for the purposes charging more money for storage and packing fees.
Jones is lying in insisting that I delayed the project. I did not live in my home during the project. I stayed with my mother and sister and slept on a living room lounge chair. I lived out of two suitcases of clothes because all my clothes, furniture, cookware, papers, books, etc were in a warehouse.
I recorded almost every phone call made back and forth to S***s and Li****y M***al from July 2003 to the present. From the beginning, I pushed in every way possible to get the project finished, so that I could get back into my house before Christmas 2003. Nonetheless, once Emer-X began the project Jones and Michal never gave Li****y M***al or me a firm completion date.
In view of the urgency on my part of finish the work as quickly as possible, it is inconceivable that planing a bathroom project stopped workers from installing two windows in the den and finishing the basement electrical repairs. The bathroom, den and basement are separate and distinct rooms.
Other damages Jones failed to address or addressed falsely: In using my toilet without permission, Emer-X workers broke the interior parts of the toilet. The toilet usage and leakage produced a very high water bill (Water bill enclosed). Their workers broke a piece of decorative wood off the dining room table. They did not fix the table but left the broken piece on the floor under the table. Their workers left a large amount mold contaminated and foul smelling cookware inside my range. They also left a lot of hardware off the windows, that Liberty Mutual paid them to install in the den.
I filed a complaint with the BBB because Michal and Jones gave wrong information about Emer-X’s insurance coverage with St. Paul Travelers. The contract was based on their documentation and verbal statements to me that Emer-X maintained insurance coverage against damages (Letter from St. Paul Travelers enclosed). In addition that they would minimize and correct all resultant and incidental damages (Powell’s 12/02/03 e-mail).
Jones, alias Charles, provided a highly dishonest response to the complaint letters. He failed to address the issue about insurance coverage past and present and he failed to address issues related to correcting the damages that I reported.
In all fairness to all homeowners do not list or report Emer-X as a company in good standing with the Better Business Bureau. Any company that misleads its customers about their name of their insurance carrier should not have a BBB seal of approval. Emer-X’s workers are very destructive and careless to a homeowner’s property; and their project managers operate deceitfully and heartless with injured claimants
Sincerely yours,
An educated consumer is the best defensive weapon against fly by night CON-tractors, insurance companies and large corporations. My purpose for placing this information on the Internet is to help someone avoid the same traps. The partial or totally loss of a home represents a major traumatic episode and their are piles of deceptive home remodeling scam artists that wait for the right opportunity to come in and take all they can get. It is not about working hard but working smart.
Be prepared from the start to go all the way to court with liens against their property, bank accounts and salaries. Before any contract is signed, spend the extra $200 to get a full background check, including their social security numbers, driver’s license numbers, bank accounts, properties. Find out whose name actually owns the business. If they provide an insurance document, don’t trust their paperwork. Call the insurance company, ask for the insurance policy numbers and check if their insurance company and your insurance company will allow claims against damages and accidents.
Most likely 30% to 50% of the time we will use the same skilled contractors that came recommended by parents, neighbors, co-workers, friend or others contractors. The majority of the crappy contractors on this Blog came from recommendations. I hired a home remodeling contractor simply based on the word of mouth recommendation of a contractor what has done superior work for me and my family for 25 years. However the guy I hired ended being a total nitwit for working with remodeling homes.
Due to the EMER-X fiasco, I learned to become my own project manager. I now verify all work and materials front and back. If the saw that he started going in the wrong direction on a project, I quickly halted the work and hired another contractor. I paid the money I owed him to the new contractor. Of course he did not like it. Nonetheless, it saved my house from burning down from his inept and improper electrical wiring of my kitchen. That’s all for now-Stay tuned to more posts for the rest of the story.
COMPLAINT ACTIVITY REPORT Case # 20015537
Better Business Bureau, Inc.
Business Info:
Paragon Construction Company
800 Metropolitan Pkwy SW
Atlanta, GA 30310-2802
404 755-2667
For the readers information, this complaint filed with the Better Business Bureau, I deleted my name, address and phone number. Other than minor line formating I did not edit or revised any words from the complaint. Please refer to the BBB Case # to get the full unedited complaint. Paragon Construction Company, at one time, ranked very high on the Service Magic refered list of general contractors and therefore I hired the company to repair a very rotten exterior window sill. Since, their subcontractors did an excellent job with this small project, I thought it would be a good idea to continue to use them. The next three projects, the screened porch, the exterior water line and finally the home renovations became struggles between contractor and homeowner, because I had to continually fight contractor to use specific building materials for each project. The ceiling accident became a blessing in disquise for us, because this incident led to the dismissal of the Paragon and the saving of our home.
I contacted “Service Magicians” several times to get the name, address and phone number of Paragon’s insurance company. I wanted to file a claim for the damages caused by the insulation spillage on our furniture and clothes. I learned after several phone calls to various agents, that Service Magic did not have on file the name of Paragon Construction Company’s insurance carrier. I found this news somewhat strange because Service Magic placed an ad for Paragon on their web site and their contractor directory, along with customer ratings, their insurance coverage amount and the review I submitted regarding the exterior window sill project.
Consumer’s Original Complaint :
I hired Paragon Construction Company to do several remodeling projects. My home was built in 1946 and the pipes were very damaged and leaking heavily. The contract Feb 13, 2006, was to replace the damaged exterior (galvanized) supply water line with a copper pipe from the water meter to house and to install a pressure valve on the interior line. Total cost paid: $875.00. I hired Paragon again December 2006 in another plumbing project to install a laundry room in my basement, to replace the interior galvanized pipes with copper pipes and to place insulation in my attic. In the process of doing this project the Paragon subcontractor discovered that I had a galvanized pipe on the exterior supply line. No copper pipes were seen on the interior supply line up to the house. The copper pipe began five feet from the house. This same subcontractor in the process of cleaning my attic of loose insulation, placed bags of insulation on the attic floor and the insulation dropped through the ceiling onto my bedroom and hallways. When he failed to clean up the insulation and delayed repairing my damaged ceiling, I requested that he not return to my home. I hired another contractor to complete the plumbing project and the attic project. The new contractor reported that very little work had been completed toward replacing the interior galvanized pipes. In addition several things were done incorrectly. I want Paragon to refund the 50% deposit of $1650.00 for the plumbing work and $391.00 for the removal of the insulation. I called and emailed the owner several times about these issues. He does not believe that he did anything wrong and believes that I owe him more money.
SETTLEMENT: Refund
SETTLEMENT EXPLANATION:
I want a refund of the attic cleaning and the basement plumbing repairs. I needed to hire another contractor to repair and correct the work of Paragon Construction. Mr. James never offered to correct or repair the damages and never came to my house to see the problems. I am seeking a refund of $2,041.00.
PRODUCT: plumbing home repairs
Consumer’s Desired Resolution:
BBB Processing
03/23/2007 jc BBB Case Received by BBB
03/26/2007 jc BBB Case Reviewed by BBB
03/26/2007 Otto EMAIL Send Acknowledgement to Consumer
03/26/2007 Otto MAIL Notify Business of Dispute
04/10/2007 WEB BBB RECEIVE BUSINESS RESPONSE : Contact Name and Title: W. L. James, Owner Contact Phone: 404-771-4578 Contact Email: paragon1945@aol.com
Paragon Cnstruction entered into a contract with ———- to replace a leaking galvanized water line from the meter to the house. The term from the meter to the house was used as ameans of designaing which line was to be replaced as opposed to a specific point to point description. When it was mentioned that the line did not go into the foundation wall, I pointed out that the new line must be connected to the existing line at a connection, which was approximately TWO FEET from the foundation wall not FIVE FEET. M——– indicated that —- wanted the existing loose insulation removed before new batts were installed. In the process of removing the loose fill insulation, a hole was somehow made in the ceiling of the bedroom.A special person was engaged to remove all of the bedding and have it laundered and thorughly vacuum the space which appeared to be all that could be reasonably done. M. ——–complained that some insulation had gotten into — closet and — JEWELRY BOX which had not been removed UNBELIEVABLE! — states that the sub “delayed” repairing —ceiling which is not true. The hole was patched promptly but the finishing process requires 3 coats with time for each coat to dry between coats. This was explained to —but — seemed determined to make this a major problem along with anything else that — could come up with. M——- had spent a good deal of time on the internet looking for exotic, unusual items for —house and expected the Subcontractor to go and get these items, somme of which were in a different city. When the Sub stated that he would have to charge — for this service, — became angry which I believe prompted — to dismiss him.We had done work for M—— before which involved re-screening a porch and painting the framework. Upon completion —- was displeased because the 60 year old framework, although it had been scraped before painting, — said it did not look like brand new wood. We therefore sanded. EACH PIECE of the framework, primed and repainted it at no additional cost to — although this would be considered to be restoration as opposed to repair work. I believe that this was a mistake as it led — to believe that any demands that — made would be satisfied without question. We try diligently to make our customers happy and I believe that our references show that we have done a pretty good job over the years (since 1969). M—— indicated to me that —dismissed the Sub because he was not rspectful enough.When I asked —to be specific, —mentiooned the conversation about going to pick up the item that was mentioned previously. Too,— said that she should have been called at work and informed about the mishap with the ceiling. I did not agree with that position.I cannot imagine what could be accomplished by doing so. Finally, I think that M. ——— is just looking for a way to avoid paying and attempting to extort money from Paragon.
04/11/2007 jc EMAIL Forward Business response to Consumer
04/12/2007 WEB BBB CONSUMER REBUTTAL TO BUSINESS RESPONSE : (The consumer indicated he/she DID NOT accept the response from the business.)
The information given by Paragon regarding the exterior plumbing was not given to me until I wrote this complaint. I paid Paragon to replace the entire line from meter to house and to install a pressure value on the the new copper line. I found out from another plumber that no pressure line had been installed and several feet of old plumbing was still in place. Paragon failed to disclosed this information to me after they completed the work. I told Mr. James of Paragon that if he could not do insulation then I would hire an insulation specialist to handle the job. He said that Paragon did insulation. In fact, he said that his company could do everything that we needed done in the house. However, James only wanted us to buy his products. We asked for energy efficient, top quality, environmentally safe, and non toxic building materials. We were willing to pay more money for these products as well as purchasing the products ourselves. I have chronic asthma and allergies and will not place materials in the house that will cause allergic reactions. The insulation was not correctly removed. The worker placed loose fiberglass insulation in plastic construction bags, then he placed these bags on the attic floor and when the ceiling broke, all the insulation fell into my bedroom and hallway. The ceiling break is not a hole, it is a large section, measuring, approx. 6 feet by 5 feet across. Since, the closet doors and dresser drawers were fully opened, the fiberglass dispersed on everything. Instead of stopping the work, they continued and removed the fiberglass insulation by carrying these packed bags through my home. I discovered the accident in the evening after returning from work. The worker who caused the ceiling damages, told me this “You have to break a few eggs to make a cake.” I had to discard the entire bedding set, which was newly purchased. Plus, everything in the bedroom had to be washed twice. The dresser was removed from the room and the jewerly box which was on top of the dresser is ruined. The jewerly inside the jewerly box is full of fiberglass insulation. Days after the accident I continued to find insulation: on the clothes hanging inside the hall closet, the closet floors and on clothes behind the bedroom door. I have pictures of the damages. Very important to note that, Mr. James did not see the damages that he is trying to address, so he does not have any first hand knowledge of the problems. He is getting all his information from the subcontractor who damaged the ceiling. I hired Paragon to renovate my home. Their first project was to set up a basement laundry room, to replace the galvinized interior pipes with copper pipes and to insulate the attic space with Green non toxic building materials.. I dismissed Paragon because they failed to correct the damages caused by the ceiling breakage and they incorrectly and unsafely removed fiberglass insulation from my ceiling. I experienced the subcontractor as very disrespectful and demeaning. Paragon started the laundry room but they stopped when I dismissed the subcontractor. Therefore, I paid them for plumbing work that they did not complete or attempt to complete. The laundry room plumbing was wrongfully done, therefore, I not only had to pay another plumber more money to finish the work but also to correct Paragons mistakes. My current contractor prepared an itemized statement of the work that he corrected on the laundry room. I also have pictures of the insulation damages. The bedroom and hallway ceilings are not repaired. Fiberglass is a serious health problem for the lungs and skin. Therefore extreme care should have been used when removing it from an attic space. Paragon owes me considerable money and they are totally untruthful to suggest that they gave me any honest workmanship. I hold Paragon responsible for hiring unsupervised and bad subcontractors. I am asking for a considerable financial settlement. Please do not list this business on the BBB web pages. They are doing very poor quality work right now.
04/13/2007 jc MAIL Manually Forward Consumer Rebuttal to Business
04/25/2007 OttO BBB No Response from Business re: Consumer Rebuttal
04/27/2007 kh BBB Bureau judged complaint to be closed UNRESOLVED
04/27/2007 Otto EMAIL Inform Consumer – Case Closed UNRESOLVED
04/27/2007 Otto MAIL Inform Business – Case Closed UNRESOLVED
04/27/2007 Otto BBB Case Closed UNRESOLVED
05/05/2007 jw BBB ReOpen the Complaint
05/05/2007 jw BBB RECEIVED BUSINESS’ ADDITIONAL RESPONSE : Paragon Construction Company,800 Metropolitan Parkway S.W., Atlanta, Georgia 30310, Phone 404-755-2667, Fax 404-755-9865
M. —— I have not responded to your communications up to this point because I wanted to be sure that my response was nor influenced by my emotions regarding this entire project. I should have known better than to undertake another project for you after the scenario regarding the wood at he porch, which incidentally was clearly unreasonable. (Your insisting that the wood be sanded down to a completely smooth bare surface.) I should have anticipated other unreasonable expectations and concluded that you are just one of those people that is looking for something about which to complain in order to avoid payment. Let us start with the water line from the meter to the house. In order to connect a copper line to a galvanized line an adapter is used which has to be attached to a threaded connection. The nearest connection to the foundation wall was the one to which it was attached. Where the figure “five feet” came from, I have no idea. It was, in fact, much closer to TWO FEET. This could be easily seen where the hole was dug to make the connection. The reason that the hole was dug was so that Mickens could remove the galvanized and connect the new copper line inside to the to the copper line from the meter. this, in fact, would have been done immediately had you not elected to banish Mickens from the premises. In regard to the insulation incident. Accidents do sometimes happen. (You may have even had one at some point) This is especially true in construction and remodeling. To be walking on ceiling joists while moving around and removing loose fill insulation is difficult and quite tricky. You stated that you thought that we should be accomplished at this task. Why? In my 37 years in this business, this is the first time that we have done this in an occupied house. Contrary to your statement that the Subcontractor did not clean up the insulation that fell from the ceiling, he went to some great lengths to restore you to your original state, including removing and laundering your bedding, completely vacuuming the entire room, etc. He also set about to repair the ceiling where it was damaged. Drywall repair is usually done in three steps, (1) hang and tape, (2) first mud coat (3) finish coat; all with an interval of usually a day between each stage for drying,. So you can see that this is not something that could be done in fifteen or twenty minutes, as you apparently expected. I have no idea why or how insulation fibers could have gotten into your jewelry box or your closet, or what could be done about it. I strongly suspect that some, if not most, of your reaction to the insulation fibers is psychosomatic, as I cannot see how there could still be fibers in the bedding after being laundered and the entire premises being vacuumed. At any rate, I informed you at the time that we would do whatever was reasonable to make you happy. (Remember what we did vis-Ã -vis your porch?) You may remember that you also charged us $150 for additional dry cleaning expense to which we agreed. We considered this to be accord and satisfaction in regard to insulation cleanup. You mentioned that Mr. Mickens had installed some pipes in the wrong location. I cannot comment on that as I did not see them in relation to the laundry room layout. If that was indeed the case, then it would have been his responsibility to simply reroute them to the correct location. No problem. You stated that you dismissed the Subcontractor because he was extremely rude and disrespectful. Having worked with Mr. Mickens for a number of years, I find this hard to believe as this seems to be completely out of character. Since the contract was with me, and not Mr. Mickens, it would appear that the appropriate course of action would have been to bring this matter to my attention, which was not done until after the fact. I would like to have known the specifics of this incident at the time of occurrence from your point of view. According to Mr. Mickens, he believes that you were angry and upset because he would not agree to go out to Stone Mountain to pick up a sink that you wanted unless he was compensated for doing so. As I pointed out to you at the outset, that without knowing what, where and when you might order items found on the Internet, we could not be responsible for the purchase and/or pick-up and delivery of same without a charge on a per item basis. This is what would be, to use your word, “fair”. To your point about “fraud”: I do not believe that any reasonable person who understands the situation would concur with your assessment. We work diligently to satisfy all of our customer to the fullest extent that is reasonably possible. (Again, remember your porch?) Apparently we have done a pretty good job. As testament to that fact, we have a very high customer rating; about 40% of our business is repeat business from previous customers: (That includes YOU); numerous letters of recommendation from individuals, businesses and organizations, and a generally good reputation in the industry. Finally, I firmly believe in doing unto others as I would have them do unto me. In fact, I often try to go above and beyond the call of duty. I am always unhappy when something does not go as I would like. But those things will happen if one lives long enough. You know the adage, “the best laid plans of mice and men often go astray”. In short, had you not taken it upon yourself to summarily terminate the project (without adequate cause, I might add), I have no doubt that it could have been completed to even your satisfaction, unless of course you decided that you simply would not, under any circumstances, be satisfied, for the purpose of attempted extortion, which clearly seems to be the case. I regret that you would not give us the opportunity to please you, as we did with the porch. Willis James
05/05/2007 jw EMAIL Send Business’ Rebuttal Response to Consumer
05/09/2007 WEB BBB CONSUMER SUBSEQUENT RESPONSE : (The consumer indicated he/she DID NOT accept the response from the business.)
I want to state for the record that nothing is made up or contrived so that I may withhold payment. I do not owe Paragon Construction any money on my contract. I hired another plumber contractor after I discharged Mr. Mickens. This man reported to me that several things were incorrectly done in the basement laundry plumbing and that apparently the person who did the work before him did not know what he was doing. In addition the work that Mr. Mickens should have completed had not been done at all. I have a copy of the contract which lists what the plumber had to do to correct Mr. Micken’s faulty work. Mr. Mickens and his sons broke the attic ceiling and spilled old loose pink fiberglass insulation into my home. It would have been very easy to view the insulation fibers on my clothes, in the closets and in the other areas, if Mr. James had visted my home. My house was not completely cleaned of the loose insulation that fell from the ceiling when the attic sheet rock broke. I have photographs of the insulation wastes in my home and I still have the uncleaned jewerly box for him to view. I can not wear the jewerly. I told Mr. Mickens and showed him the areas that were not cleaned of the insulation and he never once voiced any intent to clean these areas. Paragon never offered to complete the repairs to my ceiling or to send other professionals to my home to finish cleaning the insulation from my clothes, floors and other belongings. I did pay another plumber to correct Mr. Mickens mistakes in the laundry room. I will need to pay several other specialists to do the cleaning work and to repair my ceiling. Since a large amount of insulation fell on top of my bedding, I had to replace the bedding set with a new one. I did not feel in any way obligated to continue employing a subcontractor who worked with extreme neglience and disrepectfullness. In my experience, responsible business owners do not argue with homeowners about damages caused by their workers. Mr. James agrees that Mr. Mickens broke the ceiling however, he does not feel in any way responsible to pay to correct the damages. Mr. James neglected to correct his written contract regarding the exterior plumbing. As such he mislead me to believe that I had an entirely new copper line from street to the house and that he placed a water pressure value on the interior of the home. Mr. James argues that I made things up in order to get money out of his company. Due to the fact, that I have paid and will pay other contractors thousands of dollars to complete my home renovation, it is total false the assume that I am attempting to defraud Mr. James. Mr. James has cheated me and I expect him to pay me as soon as possible the full amount that I am seeking in damages. I am also requesting that the BBB remove Paragon Construction from their web site as a BBB company of reference.
05/18/2007 jw MAIL Forward Consumer Rebuttal to Business
06/01/2007 OttO BBB No Response from Business re: Consumer Rebuttal
06/07/2007 jc BBB Bureau Judged Case AJR
06/07/2007 Otto EMAIL Inform Consumer – Case ADMINISTRATIVELY CLOSED
06/07/2007 Otto MAIL Inform Business – Case ADMINISTRATIVELY CLOSED
Posted in Crappy Contractor Woes | Tagged ceiling, contractors, damages, EmerX, insurance, lawn, Paragon, plumbing repairs, service magic | 2 Comments »
Tips on Hiring Home Remodeling and Building Contractors by Judy Costello
A successful home remodeling project is dependent upon finding an ethical, reliable, competent and experienced contractor. This is where your research must be as thorough as possible, including background checks which will help to uncover any “skeletons” now, rather than in the middle of your project should things begin to unravel. Your work is about to begin!
• Hire only licensed contractors.
Check with your State’s regulatory agency which governs the licensing and enforcement of building contractors. If you choose to hire someone without a license you’re on your own.
• Check for a history of complaints with the Contractors Board or regulatory agency.
Verify that your contractor has a good record with your States’ Contractors License Board. Check for any disclosed complaint history and legal actions taken against the contractor. Warning: No record of complaints against a contractor does not necessarily mean no previous or current consumer problems. Problems may exist, but may have not been fully investigated and reported. It can take up to a year before the information is made available to the public. This happened to us. Eight months into our construction nightmare, we discovered the citation notices against our contractor on the CSLB’s web site that were not there when we first checked the contractor’s status when signing on with his company. Sadly, it becomes a “damn if you do and damn if you don’t”, but again, it is your responsibility to check on it.
• You could also check with your local Better Business Bureau but know that they are dependent on the Contractors License Board for any legal complaint history. However consumers who would not bother with the Contractors Board may just file their complaint with the BBB and be done with it. Ask if they have had any complaints about the contractor If so, were those complaints resolved satisfactorily. As for me, if there were complaints that’s a red flag and I’d move on to the next potential contractor.
• Check references and follow up with the homeowners. Ask for both recent (12 months) as well as the last three years. You’ll get a much better picture of the contractor’s current work and long-term standing with his customers. Talk to the homeowners to verify quality of workmanship. Visit on-going jobs and note job-site conditions.
Some questions to ask previous homeowners:
• Were they happy with the contractor?
• Did they complete the job in the time frame they promised?
• How was the quality of work?
• Was the contractor readily accessible and did he respond to problems as they arose in a timely manner?
• Did the contractor willingly make any necessary corrections?
• Did the workers show up regularly and was there supervision?
• Did he keep the project moving?
• Did the project come in at the cost stated on the contract?
• Would you recommend this contractor and would you use him/her again?
• Ask the contractor how long he/she has been in business and have they done projects similar to yours.
Five years in good standing in your community is considered acceptable. Check out those projects that are similar to your. Be sure to ask the homeowners about the contractor. Depending on the job, you should also check references from material suppliers and financial institutions to determine whether the contractor is financially responsible.
• Verify the contractors’ insurance.
Check for workman’s compensation, general liability and surety bond coverage. Call these companies and verify coverage. Ask for a copy of these certificates and verify them by calling the insurance companies.
As a homeowner, if a worker is injured on your property and the contractor does not have insurance you’ll be responsible for picking up the medical bills. Don’t let your homeowners insurance become the contractor’s liability coverage.
• Get at least three bids using the same set of plans so that you’re comparing apples to apples.
• Make sure the plans include everything you want stated in the bid.
Be very specific regarding the quality of materials, name brands, colors, sizes etc., that will be used or installed on your remodeling project. This is where the specifications must contain every detail that you’re expecting to have included or installed. Do not leave this up to the discretion of the contractor who may get greedy using low-quality materials in order to beef-up profit margins.
• Verify that the contractor maintains a permanent mailing address, e-mail address, published personal phone number, fax number, and a cell phone, or voice-messaging system.
You want to be sure that you can reach him quickly in an emergency and that he’s not just working out of his truck.
• Obtain from the contractor a list of building materials, suppliers and subcontractors he uses for his projects.
Ask the contractor for the names of the subs he plans to use on your project and check out their license status. Now this can change from job to job as far as subs go, so he/she may not be able to provide you with the subs UNTIL you’ve agreed to hire that contractor. Then you’re entitled to know who he plans to use on your project.
Just make sure that the contractor uses licensed sub-contractors, obtain their license numbers and check their status with your Contractors State License Board. If you have questions- by all means ask!
• Contact the suppliers to verify his credit standing.
Does he have an account or pays on delivery? Most suppliers are willing to extend credit to financially sound contractors. Contact the sub contractors and ask if the contractor pays them timely and if they have had any problems with nonpayment. These are some simple checks that homeowners can conduct and it bears repeating. It can reveal much about the contractor and save you from a horrible nightmare.
• When interviewing contractors pay attention to how you feel about him/her.
Are you comfortable dealing with them, do you have a good feeling about having them around for a few months or more. It’s just as important to have a good working relationship with the contractor as it is to have a contractor with great credentials.
• Consider doing a more extensive background check on the contractor you’re thinking of hiring.
With tens of thousands of dollars or more of your money on the line, wouldn’t you’d like to know if the contractor has a lien history, litigation history, bad debts or past bankruptcy before signing a contract? Well of course you would. You can begin by conducting a search of court records in your city/county to check for litigation history and you can also check their lien history by doing a search through the County Property Assessor’s office that records these liens. Some of it you may be able to do on line otherwise you’ll have to physically go to these places to conduct your search.
••Check the sub-contractors’ license number and get business cards from all the subs who work on your project and keep track of when they have completed their job on your project. Again, be sure everyone is paid before you cut the check to the contractor. BE SURE TO OBTAIN LIEN RELEASES FROM THE CONTRACTOR WHEN PAYING FOR WORK THAT HAS BEEN DONE.
• Finally, get a written contract but sign nothing until you completely understand the terms.
It is well worth your money and peace of mind to know that you have signed a well-written contract that protects your interests and not just the contractors’. You can read more about construction contracts by reading the section on contracts.
Key point to remember: Never pay more than 10% or $1000-as a down payment- whichever is less (for California) and for other States usually not more than 30%. More on this in the Home Construction Contracts section.
Know that NO ONE ELSE is looking out for you BUT you, so double check your contractor of choice. As I’ve said in the past, when it comes to hiring contractors it’s a crap shoot. But you can increase your odds of success by taking those extra steps because in the end, it will be well worth the trouble. I know this seems like an awful lot of work and it is, but it is absolutely necessary if you want to avoid an encounter with the contractor from hell and reduce your chances of a remodeling project gone bad. Author: Judy Costello, Consumer Advocate and Web Publisher
About ContractorsFromHell.com
Jody Costello is a Consumer Advocate and publisher of ContractorsFromHell.com. As a result of a home remodeling nightmare she created ContractorsFromHell.com to help others avoid the problems her family encountered. Over the last nine years she has helped homeowners deal with problems as well as providing tips and resources. Working with the Contractors State License Board over the years, Costello helped to create greater protection and a voice for consumers and has testified before the State Senate supporting legislation protecting consumers.
Go to http://www.contractorsfromhell.com
MUST READ: Warning Signs You Need to Know Before Hiring A Contractor
© 2000-2009 ContractorsFromHell.com LLC
Posted in Homeowner and Consumer Information | Tagged bids, contractors from hell, credit standing, homeowner's insurance, liability coverage, licensed, subcontractors | Leave a Comment »
JMH Precision Landscape, LLC
Horace E. Augustine, estimator
1096 Rowanshyre Circle
McDonough, GA 30253
Phone: 404-259-7790
JMH Precision Landscape, LLC is one of those companies that in my opinion should disappear as a business in any state. Why? Because they make up excuses as they go along to cover their incompetence.
I placed a listing on the Service Magic web site, another consumer rip off company, for a qualified landscaper for sod installation and general lawn care/clean up. I wanted excellence but instead I got JMH.
They did make their appointment on time; Mr. Augustine came to my home, in professional attire. He listened to what I wanted, photographed the area, measured the lawn and said he would get back to me through emails about the cost of the project.
Mistake #1: I trusted the Service Magic home improvement network recommendations. Common Sense Wisdom-Never use Service Magic’s subcontractors without making sure all your P’s and Q’s are perfect.
The Atlanta Better Business Bureau does not help homeowner’s ripped off by contractors or the subcontractors involved with Service Magic. BBB will gather all your information and send it to the business for a response. Nonetheless, after the first response and rebuttals are filed it then basically becomes an email debate with the BBB serving as the referee. I’ve never, never, never had the BBB negotiate a favorable result in my favor on any complaint, regardless of the money involved or the amount of supporting documents. In fact the BBB will contain the names of horrible contractors, that seriously should not be permitted to continue doing business.
I would love to know if anyone has any experience with getting positive responses from BBB complaints. If so, please let me know the secret of your success.
Another ruse of Service Magic is to show a listing of homeowner’s ratings for their in network contractors. Well, believe it or not, SM highly screens out the low consumer ratings and publishes the high customer ratings and praises. I sent in my ratings for JMH Precision Landscape and Paragon Construction; and they never showed up on the SM web site. However, my high ratings not only showed up on the web site, SM used it for their advertisement booklet for the contractor. Consequently, homeowners never have reliable and trustworthy consumer ratings for anyone in the SM network because only the great ratings show up.
Mistake #2: I trusted the contractor’s words. Joke: “How do know that your contractor is fibbing? Answer: When they begin talking to you.” Common Sense Wisdom-Be extremely wary of contractors that want all their money upfront before the project begins and never pay any down-payment without a contractual agreement on the project costs and the completion date.
Augustine told me that he would put down landscape pavers when he installed the sod and that his men first needed to kill off the old lawn and then the following week they would grade the yard and install the sod. The following week two men from JMH came by seeking money for the sod project. I told them, that I don’t have a signature on the contract and when I got the contract completed, then I would give a 50% deposit and pay the balance after they completed the work. The men said they could not complete the project today because they needed to put down a stronger chemical to kill the lawn. I said okay and warned them again not to kill off the sidewalk plants (Dwarf Mondo grass) and the Hostas surrounding an oak tree. I left them outside to finish the work. Common Sense Wisdom-Always survey what the contractor does and the materials and/or tools he/she uses to complete the project and never leave a new contractor alone with your property unless you love, love surprises.
The next day, I discovered that the men covered my lawn and plants with a chemical that looked like green spray can paint. Needless to say, I was more than slightly upset. So I telephoned JMH and a man, who spoke with a pleasant-sounding voice, said that someone would come by to sign the contract they emailed me and they also would pick up the agreed deposit. He also said he would take care of the problem with the plants being sprayed.
Mistake #3: I permitted work without the company’s signature on a contract. Common Sense Wisdom-Alway ask yourself, How much will the project cost to repair in time, effort and money if this contractor does a bad job? Many self employed handy-men, contractors and subcontractors do not use contracts. For example, a paid a kid who lives next door $20.00 to mow the lawn. He does the work and I give him the money, no problem, this is a word of mouth contract. Yet, it is important to know that this kid’s old, rusty blade lawnmower can destroy a beautiful lawn by ripping the grass or spreading outside weed and grass seeds in my lawns. So that $20 mow job can easily end up costing $300 or more for replacing or repairing damaged grass or sod and/or getting rid of unwanted weeds.
No one ever came by from JMH for their follow-up appointment to sign the contract. When I telephoned again, a man told me that they decided to drop the project. Of course, they dropped the project, they had messed up big time. Their ignored me about not killing the ground cover plants and sprayed everything. They did not want to install my preference for landscape pavers and most importantly they did not want to correct any mistakes.
The end result-Instead of viewing a green lawn, I got to enjoy the sight of bare dirt.
Lawn Before Precision Killed It
After Precision-No Lawn and No Sod Either
Totally Dead and Gone Mondo Grass
Posted in My Landscaper Nightmares | Tagged dead grass, lawn care, plants, sod installation | Leave a Comment »
Every thing about this idea sounds wonderful – Service Magic web site promotes “Get Matched to Screened and Approved Professionals.” The web site has numerous project categories to select from and offers a variety of contractors and subcontractors that are matched to your personal renovation and/or repair needs. Plus Service Magic web site shows the customer references, performance ratings and the insurance amount each contractors carries.
The old slogan of “If it sounds too good to be true, then it is too good to be true.”
The truth is Service Magic contractors and subcontractor are no better than any one found though other sources, such as the yellow pages, Craig’s list, newspapers and word of mouth references. In other words, Service Magic does not reduce any risks of hiring a Crappy Contractors than any other referral sources.
I learned one way to avoid scam, fraud and cheaters is to think ahead of the game. I don’t care if Jimmy or Billie did fabulous work for your family members and friends, it does not mean they will follow through with you. I can find more teeth in a hen’s beak than I can find one consistent and reliable contractor in my State. No joke – The State of Georgia is a Crappy Contractors gold mine.
The one rule to never forget, Don’t Trust-Ever!
Posted in Crappy Contractor Woes | 5 Comments »
Mr. Ricky Henson.
Budget Landscaping
53 Red Top Circle
Emerson, GA 30137
ph: 770-607-5190
alt: 770-877-2921
My experience with Mr. Henson’s company Budget Landscaping began last year, when another big C contractor decided the drop the project to sod my front lawn after first applying lawn killer twice in two weeks. I will get to him later.
First meeting usually is the best for new contractors projects. That is because they want your money in their pockets. Mr. Henson gave a good price to sodding a small front lawn with Empire Zoysia. Since this sod is summer season we decided not to install the grass in the early winter but to wait until the weather warmed up. Now this is when things really began to get ugly, cause Spring 2009, metro Atlanta and most of Georgia state experienced heavy rain storms almost every day.
March 2009, Budget Landscapes arrives at my house and complete the sod project and this is what my yard looked like:
Patches of Dead Empire Sod
Five Weeks after Sod Installed
Lawn Appearance - Majority Dead Sod
Lawn Before Second Installation
Watering Failed to Improve Sod
Lawn 60 Days After Installation and Irrigation
Now it is important to know that I maintain the one of the best looking lawns in my neighborhood. For more than ten years, I planted and reseeded my lawn with Scott’s Fescue seed and used Scott’s Turf Builder. In 2004, another Georgia’s Crappy Contractor, Emer-X, owner and manager D. Michals, completely killed off the fescue lawn by using the lawn to deposit their construction waste coming from my home.
Of course, like most Crappies they did not want any responsibility to repair their damages to the lawn. So, I decided once all the contractors project finished I would being again, but this time professionally install easier to keep up lawn.I got Budget’s name from another contractor I used, Pinnacle Contractor and Pinnacle’s subcontractors did great work, I assumed their landscapers would also do a great job.
Budget Landscapers did a Crappy job on my sod installation project. I suspect, the first installation they placed damaged sod in my lawn and then lied about why the lawn never greened up. Maybe they got a good deal on dead or dried sod and hoped they could cheat a woman easier.
I watered the lawn after the installation every other day for 45 minutes and still after two months most of the Sod failed to green up. They claimed they sent a specialist to view the lawn problems and he reported the lawn died due to lack of irrigation. I seriously doubt that a lawn care specialist came to inspect the lawn in person, most likely these folks showed him the pictures of the lawn I sent through emails.
Three months after the first installation Budget agreed, because I insisted, to remove the all the sod and replace it with fresh, FRESH Empire Zoysia. I followed the same watering plan I used before and this time because fresh sod, meaning green and growing, instead of dead and dying, got installed the lawn stayed green all Summer and Fall.
Nonetheless, homeowners get sod because they want a green lawn right away, not in 2, 3, or 4 months. I am not going to speculate their reasons or logic behind doing crappy work, all I know is that be on guard for these folks.
Posted in My Landscaper Nightmares | 1 Comment »
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