Having read the Leicestershire Builder for the past year or so (which I find is an excellent read), your column has always caught my eye, and although I am a client as opposed to a contractor or builder, I was hoping that you may be able to give me some guidance on a problem I believe I have.
I purchased a house in 2014 and then set about instigating plans for a major refurb. My lack of expertise on such a project meant that I employed an experienced Architect from the outset, and when I engaged the builder, a JCT Intermediate Form of Contract, 2011 with contractors design was executed. However, I have become increasingly concerned that the Architect is over-valuing the work carried out by the builder. I did seek professional advice from a quantity surveyor who said that the work may be over-valued, although the advice was not specific and lacked detail.
I have poured a lot of money into this project and want to ensure that I get value for money. Any suggestions?
Benje, south Leicestershire
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Hello Benje. You appear to have procured your project correctly, and in theory your Architect should be a pair of safe hands when it comes to administering the Contract. However, where an Architect has issued his interim certificate for payment, you maintain the right under the Contract to pay a lesser amount than certified providing you have issued a valid and effective pay less notice.
If you are going to issue a pay less notice, it is of paramount importance that it is issued on time and is effective. If the payment provisions of the Contract are un-amended (section 4), the builder is required to receive payment within 14 days from the due date unless it is in receipt of a pay less notice no later than 5 days before the final date for payment. If you issue the pay less notice late, even by one minute, no monies can be with-held. In addition, the pay less notice must also include a) the sum that you consider to be due on the date that the notice is served; and b) the basis on which that sum is calculated. It is also imperative that the pay less notice comes from you as the employer named in the Contract or a duly authorised person on behalf of you providing you have notified the builder in advance (see clause 188.8.131.52 of the Contract).
However, if you do issue a pay less notice, there is a risk that the builder will issue a notice of its intention to suspend performance under clause 4.13, followed by a notice to suspend. If the builder does suspend performance, you will need to consider your options under clause 8.4.1 of the Contract, and in particular sub-clause .1, although you must be absolutely certain of your position and the validity / effectiveness of any pay less notice issued prior to invoking clause 8.4 and the sub-clauses. You must also realise that in agreeing to the JCT IFC, the contractor has a right to refer any dispute to adjudication (unless the relevant clause has been omitted).
My suggestion is to have a meeting with your Architect and discuss your concerns. Your Architect is well experienced and should be able to explain how and why the costs have been evaluated. However, it is vital that you do not attempt to interfere or influence the Architect otherwise this could be considered a repudiatory breach of contract, which would allow the builder to accept the breach, bring his employment under the Contract to an end and pursue you for damages.
I wish you good luck with your project.