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Changing method of construction without owners knowledge

ArizonaChange OrdersConstruction ContractDesign Professional

I entered into a strange relationship with a general contractor who from my perspective was trying to give his construction business design-build capability. It started as create some construction documents and we will see how it goes. No contract, no hard figures as far as payment goes except for $1 per Sq ft (excluding the non-livable space). As time passes and projects were completed I kept getting wiffs of something and it started feeling like something was off. I was in the process of making some changes to some documents when I received a request for a cheaper alternative method of construction (specifically changing from a stem wall with spread footing to a slab on grade monolithic style foundation) my immediate reaction was HELL NO. I didn't respond immediately, the request was on a Friday evening. The next day I asked 1 of the 3 home owners had signed their contract yet. They had, on Friday morning. From my perspective, he is trying to save money by cutting corners without the owners knowledge. They believe that they are paying for one type of foundation, yet would more than likely receive the cheaper alternative were I to supply it. I adjusted my invoice and send a formal letter stating that due to my elevated exposure to risk my invoice would reflect that. Am I correct that his actions were unethical and my response appropriate?

3 replies

Oct 1, 2020
I think you have correctly described it as a "wiff." You won't know for sure unless you talk to the customers. I am assuming you are a subcontractor, so I doubt you have much in the way of exposure without a direct relationship with any potential victims of what may be fraud. But if you are truly concerned there is nothing wrong with checking with the customers and even asking them for a copy of their plans and specifications to see if they match with what is actually being done.
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Oct 1, 2020
I am the designer of the house. I spoke to one of the clients who had no knowledge an alternate and cheaper foundation had been requested. The hypothetical is, had I provided him with the means to perpetrate the scheme would I be at risk or as culpable?
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Oct 1, 2020
Legally you are probably fine. There is no duty to prevent the breach of a contract to which you are not a party. As long as you delivered the design you were supposed to, you are not responsible for someone else putting in the wrong foundation. That said, it would probably be better for everyone if this issue (and it may not even be an issue) is sorted out now rather than later. Moreover, just because you are not responsible does not mean you will not get sued if the owners get angry enough. Paying $100,000 in attorneys' fees to prove you didn't do anything wrong is a hollow victory to say the least.
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