It is not uncommon that a project initially expected to be a “small” job becomes more complicated as work proceeds. This can often become a point of contention with clients, regardless of whether you have a written or oral contract. In the recent Provincial Court case of Portnoy and Khait v. Pacific West Mechanical, a plumbing service took a small financial hit, when a “small” job became more complex than originally planned.
THE FACTS
This case involved a couple (the “Homeowners”) that owned a condo unit in Vancouver. The Defendant was a plumbing contractor retained to perform plumbing kitchen repairs at the Homeowners’ condo unit. The Defendant estimated one-hour to complete these repairs.
However, the repairs took longer than expected because the Homeowners had recently replaced their kitchen sink, which resulted in debris contamination in the plumbing lines. This fact was not known to either party when the time estimate for the plumbing work was originally provided. The additional work took an extra 2 to 3 hours to complete and the Defendant charged the Homeowners accordingly.
The Homeowners initially paid the Defendant for the extra work but then sued to recover the amount paid over and above the original fixed-price contract.
DECISION
The adjudicator hearing the case accepted the Homeowners’ evidence that the contract was originally meant to be a fixed-price one. However, he also found there was “more to the story than the contractual arrangement”. Because the Defendant did not know about the debris in the plumbing lines when the contract was made, the adjudicator found it could not be held strictly to the fixed-price contract in those circumstances. In the result, the Defendant was entitled to some, not all, of its invoice and had to refund the Homeowners for part of the extra payment.
LESSONS LEARNED
Even if it initially appears that a job will be small, the possibility exists that the scope can expand due to unforeseen site conditions. Make sure your contract (especially a fixed-price contract) clearly stipulates whose responsibility it is to pay for additional costs resulting from unforeseen complications on site. Also, if unforeseen conditions arise, ensure you obtain signed authorization from your client in advance to show that extra payments for any additional work have been agreed to.