Having home renovations done can be an exciting experience. It’s fun to see a dream project come together. Despite the excitement of a project, it’s important to keep track of records and agreements amongst homeowners, contractors, and sub-contractors. As seen in a recent case before the Provincial Court of Alberta, failing to do so could lead to a messy and costly experience.

The original scope balloons

The plaintiff is an electrical company that was hired by a contractor to do work on the defendant’s house. The plaintiffs provided the defendants with a quote for $16,750 plus tax, which was accepted. The defendants paid installments on the work as it was done. However, as is often the case with construction and renovations, the work being done changed in scope over the course of the product. When all was said and done, a final bill was sent to the defendants on May 10, 2016. The final bill was over $27,000. At the time the bill was sent, $23,000 had been paid. The plaintiff was seeking an additional $4,906.43, which was mostly in relation to a line item on the bill for “extras” in the amount of $3,945.05 plus tax.

Unwanted extras?

There were a number of items that fell under the “extras” category that the defendants claimed were either unwanted or should have been part of the original quote. The final bill was broken down as follows:

• $16,750.00      Original quote
• $  3,750.00      Basement
• $  1,885.00      29 extra pot lights
• $     297.50      7 extra surface lights
• $  3,945.05      Extras
• $  1,328.88      GST

In order to determine which of the “extra” costs were valid, the court looked at whether they should have been included in the “original quote”, and failing that, if they were requested by the defendants. Some of the notable charges were:

Well power: This was specifically excluded from the original quote. Since it was requested, the plaintiff was awarded $240 for labour and $36.18 for materials.

Deck barbecue: The court was not convinced that the defendants wanted this extra work done. Money for this part of the project was not awarded.

Deck fan and hot tub wiring: The defendants submitted that the plaintiff knew this work needed to be done and should have been included in the original quote. However, the court noted that the quote specifically calls out which areas had been included for electrical installation, with the deck and hot tub being omitted. As a result, the plaintiff was awarded $360 for labour and $284.64 for materials.

Water treatment system: Despite receiving a bill for this item, the defendants’ claimed it was already in place before the work was done. As a result, payment for it was not provided to the plaintiffs.

Outside pot light trim: Like the deck barbecue, there was no evidence that this was requested.

Master bedroom fireplace control: This fireplace was taken off of the plan, leaving the court to determine that the defendants should not be charged for it.

Media room projector power and cabling: The court found that this item should have been included in the original basement quote.

Deck television: The original quote included the supply and installation of “T.V. outlets.” The court concluded that this should have been covered by the original bill.

After taking all of this into account, the court revised the bill, taking over $3,000 off.

Defendants argue against paying

Despite the reduced bill, the defendants argued they should be precluded from paying. They relied on Section 6(2) of the province’s Fair Trading Act, which states:

6(2) It is an unfair practice for a supplier, in a consumer transaction or a proposed consumer transaction, …

1. d)    to charge a price for goods or services that grossly exceeds the price at which similar goods or services are readily available without informing the consumer of the difference in price and the reason for the difference;
2. e)    to charge a price for goods or services that is more than 10%, to a maximum of $100, higher than the estimate given for those goods or services unless
3. the consumer has expressly consented to the higher price before the goods or services are supplied, or
4.  if the consumer requires additional or different goods and services, the consumer and the supplier agree to amend the estimate in a consumer agreement;

The court found that despite some of the items being improperly grouped under “extras,” it was not done in a way that violated the Fair Trading Act.

Contract disputes in construction can be bad for all parties involved, leading to lengthy and possibly expensive litigation. At HMC Lawyers we believe that many disputes that arise over the course of a project can be avoided through proactive legal advice. We work to carefully negotiate and draft contracts to identify potential areas of conflict and clarify outstanding issues before they become difficult problems. Our skilled lawyers identify the best potential outcomes for our clients and work diligently to resolve matters quickly and with certainty. If you are involved in a construction contract or delay claim, call us at 1-800-480-3534 or reach us online to talk today.