All Forum Posts by: Jonathan A.

@Jonathan A. let me add this disclaimer *I'm not an attorney*, but curious to know whether there was a decomposed SOW with costs tied to them signed by the partners.  As a certified PM, any rehab on my properties above 50K, I include a decomposed scope with an approximate cost of materials & labor, and disclaimer on the timing of the project.  Work does not begin until each stakeholder has the opportunity to read and SIGN this document.

Let me also add, I've been using the same contractor for 3 projects lol...but I think it's for both our best interests...makes me and him (and team) accountable.

After review of all emails, I was asked by the partners how much could i do the renovation for and I said $275k. There is no where that I said i would do it at cost. I was the manager of the company and had full power to make decisions. They never seen the contract or signed the contract. They only signed the operating agreement that does not mention me doing the remodel at cost. 

@Jonathan A. I've worked with a construction company, that had equity interest in the architectural company that bid out the work. We were able to bid on all the jobs the architects designed, but they didn't just give us the jobs. We still had to have a competitive bid.

If you just decided to use your company then that could be an issue. If you didn't get quotes from other contractors, then you may not have been acting with their interests in mind. What correspondence do you have with your partners on using your construction company? Look through your emails, do you say you're doing the job "at cost" anywhere?

A simple litmus test is if the cost of the project went over $275k, what would your contract and construction company allow you to do? Would your construction company eat the cost? Does your contract talk about change orders? If all you had was a one page quote with line items and a price, then I think it could go either way. If you had a full contract that states the scope of work and what you will and won't do, then you are probably covered.

@Jonathan A. I have carefully read multiple postings in this thread and you better hope your partners or their attorneys don’t get access to your comments.  @Mary M. is correct, the more you post, the more you look guilty of their accusations.  I am not trying to mean but merely being neutral as I read all of these details. It’s sounds your “costs” have built in layers you are justifying or rationalizing. If you have a contract that clearly says bid and not to exceed $275K then that’s on thing, but if it says $275K max and at your COST, then I think they will be looking for a refund.  I would lose the battle and win the war. Tell them the actual truth. Best of luck ! 

No its a CSLB contractor contract that has a description of the work, labor, materials and a price of $275k broken down into sections agreed upon by all investors. NO where on my contract does it say I have to prove the project cost $275k. I allocated my best workers to the project, i went to the city multiple times to deal with inspectors, I used my experience and knowledge to run a smooth job, this was a 6 month process. I put my reputation on the line and these people would never have qualified for a hard money loan without my experience in the industry. Im selling additions at $400 a sqft retail these days, so for them to question me at $100 sqft is ridiculous. My operating agreement is 50 pages long and it does not say I have to show them any numbers.