Fall Real Estate 2005

Publication Date: Wednesday, October 12, 2005

Get it in writing
Avoid construction nightmares by establishing expectations up front

by Molly Tanenbaum

Everyone knows someone who has lived through a "construction nightmare."

"Things do go wrong. I call construction 'organized chaos,'" Redwood City contractor Erik Sundquist said.

Erik Sunquist, a Redwood City contractor, inspects construction on a Portola Valley house.

"There are always things that don't go the way you planned. The goal isn't to avoid all of that. It's how to handle it when those things do come up," he added.

When Kathy and Tom Six set out to remodel the family room of their Mountain View home early last year, they were new to the construction world. After months of delays, disputes and e-mail battles with a difficult contractor, they learned these important lessons the hard way.

"In hindsight, I should have gotten everything in writing, down to the last screw and nail," Kathy Six said.

While problems such as what the Sixes experienced may not be completely preventable, there are key ways to minimize or ameliorate problems, according to Peter Daly, founder of Constructive Resolution Associates, a Sebastopol-based company that provides mediation and legal advocacy to both sides of remodeling disputes in the Bay Area.

Contractor Erik Sunquist inspects the tiling job Frank Solorio (left) and Mario Reyes are working on in the master bathroom of a Portola Valley home.

Daly, who has worked in construction for more than 20 years and also served a term as president of the San Francisco chapter of the National Association of the Remodeling Industry (NARI), decided to apply his much-needed mediation skills to the business. He has been involved in countless cases in the Bay Area, from Marin to San Jose, and argues that almost all remodeling disputes come down to the issue of quality even though they may be masked by other problems.

"I think what happens is [disputes] get expressed as disputes about money," Daly said.

"In general, as long as the contractors don't maintain the quality of the work, that's it. There's no recovery from the dispute. If the quality is good but the disputes are about time or money, they can usually be resolved."

Unfortunately for the Sixes, their construction problems had to do with quality, time and money. The worst example of this, according to Six, was the installation of wood flooring.

"We were assured they had someone who was familiar with our wood floor to install but instead used the carpenters they had on the job," she said.

The carpenters had to redo the job two times, according to Six. First, there were quarter-inch ridges in the flooring and the second time, they used visibly damaged floorboards from the failed first attempt.

"When the floor was finally finished, I looked it over with the company employee noting all the scratches and gouges. I said I did not want it pulled up again, and they varnished the damage," she said.

While the occasional mishap may be par for the course in a home remodel, the communication difficulties the Sixes experienced with their contractor made the process stressful and emotionally draining.

"[The contractor] and I went through e-mails for about six weeks because she just refused to come out until we agreed to her demands," Six said.

But according to friends, Sixes' situation could have been worse.

"When I discuss our problems with people, their only response is that we are lucky the contractor returns our e-mails," Six said.

Both to prevent problems and to confront those that do arise, it is vital to the project to establish solid lines of communication early on.

Sundquist, owner of Sundquist Associates, also authored the booklet, "105 Essential Tips for Maximizing a Home Remodel" (available for $5 from www.remodelingtips.net), in which he provides advice on topics from selecting the right contractor to sticking to a budget.

He points to good communication on both sides as the best way that homeowners and contractors can prevent a situation from going sour.

"Establishing an honest, straightforward kind of communication with your clients is number one because that supercedes any contract," Sundquist said.

In Daly's mediation experience, he has observed situations where communication broke down for various reasons. He tells homeowners that part of communicating well is providing as much information as possible to the contractors in advance. This usually means paying an architect or design professional to draw up detailed plans at the beginning.

"I think a lot of homeowners are reluctant to pay for that up front. That is part of the construction process and they either pay for it up front or they can pay for it piecemeal along the way by addressing these decisions by a sort of fire alarm process."

Sundquist takes this one step further. He recommends design-build and getting the contractor on board early in the planning process.

"If an architect has drawn plans, plans never work 100 percent the way they're drawn," he said.

"And you also have one point of contact -- here is the contractor who is responsible for everything so there's no finger pointing," he added.

Whether homeowners choose to go with an architect or design-build through a contractor, it is crucial that they provide as much information to the contractor early in the process, Daly said.

"I think a lot of disputes arise because the homeowners don't give the contractors all the information they need," he said.

If disputes do begin to arise, it is important that homeowners write down the details of their communications with their contractor -- a lesson that the Sixes learned the hard way.

"If it gets beyond that, where they're really starting to feel worried or the responses aren't satisfactory, they should start addressing things in writing. If I had informal discussions with the contractor, I'd write right away," Daly said.

There are several benefits to keeping things in writing, according to Daly.

"I think that brings the whole issues into a little more focus for both parties and it forces the homeowner to be more specific about what their concerns are," he said.

And in a worst-case scenario, the more a homeowner has in writing the better, if the dispute grows to the point of requiring arbitration or other legal action, Daly added.

In the Sixes' case, first she brought her husband in to communicate with the contractor, who then requested that Six be taken out of the picture completely.

"She asked that I not talk to her subs, but they told me they can't do their job unless I talk with them. She then demanded that I not even be home when they come over," Six said.

The Sixes were at their wits' end and finally took their complaints to the Better Business Bureau and to the Contractor's State License Board. Their case became, "the longest open case our CSLB rep ever had," Six said.

When approached by a person inquiring about their contractor from the sign in their yard, Six imparted her recently acquired wisdom.

"We told them if they do decide to use her company, make sure they get everything in writing. As our job progressed, her employee promised us things that she refused to honor since I did not get it in writing. I'm the kind of person that honors a handshake; obviously she is not," Six said.

"We want others to learn from our mistakes, our very expensive mistakes. I know we have. Our next job [the kitchen] will run much differently," she added.

How to hire a good, professional contractor

Knowing what to look for in a contractor can help get a project off on the right foot and avoid ugly situations down the road.

A good place to start is to contact the National Association of the Remodeling Industry (NARI). This organization is an opt-in network of remodeling professionals. Headquartered in Illinois, NARI has two local chapters -- one in San Francisco and one in San Jose.

NARI provides information and referrals to people interested in remodeling their homes. The organization also provides professional development classes for its members.

"NARI is out to raise the level of professionalism across the industry. The people in NARI are working at a higher level," said Peter Daly, former president of the San Francisco chapter.

Contractor Erik Sundquist has been a NARI member for eight years and joined because he believes they help to bring more professionalism to the industry.

He advises homeowners to hire a contractor who is someone they would like to work with, a good listener and has a professional business. He does not recommend simply going by who is the least expensive.

"Construction has gotten away with [a lack of professionalism] for a long time. But these [remodeling jobs] are huge investments. You're trusting a lot of money with a contractor and you should expect a professional outfit, not just shop for a low price or who you could get the best deal from," Sundquist said.

"I'd look for if a contractor is involved in outside organizations in the community at large. I'd avoid the dog-in-the-back-of-the-pickup-truck type of contractor," he added.

Sundquist tells homeowners that it's a good idea to get a contractor on board early, whether or not an architect or designer is drawing up the plans before they are handed over to the contractor.

"You get reality checks on the cost, the contractor will help value-engineer it, and there's less scrambling for your contractor of choice when it comes down to producing the project because they're too busy," Sundquist said.

And of course, talking to people who have hired that contractor to see what their experience was like is a must. If they would not hire the contractor for another job in the future, if communication was poor, or if the project was delayed or of a lesser quality, those are all reasons to look elsewhere.

-- Molly Tanenbaum