Florida building boom and fallout

[Traci Lovelace]

It is a wild world down here.  We are putting an addition on our house.  We pulled the permit and will be doing a lot of the work ourselves to hold down the costs, but hired a shell contractor to build the shell.  Because my background is in renovations, I was not familiar with that term and had many questions about what was and was not included.   After several months of back and forth we finally got a quote, very generic, on a piece of paper labeled "Estimate".  When I questioned this I was told that they didn't do contracts and that was their binding agreement to do the job.  Because this contractor has business relationships with our architect, and a large builder in the area, we went forward.  A check for 50% of the job was provided a month ago to "purchase materials".  That order was not placed until last week.  Additional expenses are popping up.    Site prep, surveyor, we even had to purchase our own doc box.  While in retrospect I can understand these things, they were not listed as additional expenses during the many many times I asked about the division of responsibility.  The contractor stated that they always told people to allow an additional 5%.  They did not mention this to us before taking our down payment and telling us their number was a binding agreement.  Now the contractor says that materials have gone up in costs and we are responsible for the delta.  This was not covered in the "estimate"/"Binding agreement".  Additionally, materials are not available and there will be more delays.   I have read that builders are including clauses in their contracts that allow them to pass on additional material costs, but we did not have this agreement.  Also, after receiving the deposit, the contractor has stated they are going to have a contract drawn up.  We are puzzled as to the timing of this and have told them that the contract should be materially the same as the information provided before payment of the down payment. 

There are so many buildings going up that it was difficult to find a shell contractor willing to take the job to begin with.  What would you do?