Published in the ECHO Journal, April 2011
Lessons from the Field
Occasionally, the simplest undertaking can turn into an exasperating experience, especially when clear communication between parties involved has not been established. The dynamics of miscommunication often occurs during the maintenance and repair of a complex, and it is usually not recognized until a job begins to go wrong. Problems can develop when requests for work are not properly defined, communicated, and supervised. Yet many associations and managers forget to take simple precautions to ensure repairs are properly defined and carried out.
As with any job, it is important to make certain the services to be provided are necessary, that they are done in a workmanlike manner and resolve the issue at hand. Ultimately, the responsibility for this oversight falls on the association through its board of directors. This article will illustrate the need for associations and managers to understand why the work needs to be clearly defined and understood.
In my work with associations I have seen numerous examples of requests for repairs turn into frustrating experiences coupled with unnecessary work, time delays and escalating costs. The reasons jobs get out of control can always be traced back to assumptions being made by both the association and the vendor and the lack of proper review and oversight of the work being requested by the association.
Recently, an association decided to replace the failing address lights located on the unit garages. The job was simple enough; it basically involved the removal and replacement of the address light fixtures and connection to the low voltage wiring. In fact, the job was assumed to be so simple that the bidding contractors never looked inside the garages to verify how the address lights were connected to the electrical system.
In this complex, like most, the address lights are low voltage, meaning the wiring for the lights is connected to a 12 volt transformer (wired to a 110 volt circuit) and always on. These transformers supply power to two devices, the address lights and the front door bell.
The management company obtained bids from several contractors without a detailed description of the work to be done, and the bid was awarded to a general contracting firm. The general contractor proudly asserted to the association that the new address lights would be an upgrade to the existing fixtures because they were larger and illuminated with four bulbs instead of the existing two bulb fixtures. The bid for replacing 96 address lights was approximately $8,500.00.
The job was scheduled and went smoothly until half of the units were completed. Surprisingly, complaints were reported to the association that the new address lights were flickering, dimming and burning out. The contractor was contacted and asked to investigate and correct the problem. At first the contractor thought the address lights were defective and consulted with the manufacturer. He quickly found out the light fixtures were not defective; but they were being powered by an undersized transformer.
The manufacturer’s installation instructions clearly required the fixture to be connected to a 16 volt transformer, not to a 12 volt transformer as existed. Since the contractor did not perform a site investigation prior to bidding the job and did not review the installation instructions, he was now faced with wiring a new junction box and a new 16 volt transformer in each garage. However, not knowing how to deal with this, the association allowed the contractor to take advantage of the situation.
The contractor argued that installing a transformer was not in his original contract and, that in order to do so, would require a change order. He justified the cost of the change order by stating purchasing new transformers and gaining access to the electrical panels to turn off the power would greatly increase his costs in performing the job. The change order was for approximately $8,000.00, almost as much as the original estimate.
The contractor would not continue the job until a change order was signed and full payment was made for the light fixtures. With the work only partially done, the association felt pressured to complete the job. Not wanting to change contractors, the association agreed to the change order but did not agree to reimburse additional monies before further work was performed by the contractor. At this point the job stopped, and the contractor refused to continue.
Frustrated, the association requested that I review the installation with the contractor, work out a solution, and negotiate payment owed to have the work continue. Since the old transformers were still powering the front door bells, new 16 volt transformers needed to be installed. This could easily be accomplished by tapping off the existing 110 volt circuit supplying the 12 volt transformer. The contractor agreed to perform the work in this manner, and we negotiated that he would receive partial payment once all the new transformers were ordered and delivered to the job.
As it turned out, the contractor never intended to install an additional electrical outlet for the 16 volt transformer. Instead, he decided to install a “plug in” transformer. The manufacturer offers a “plug in” 16 volt transformer as an option for home owners who do not want to hire an electrician to wire the transformer to an electrical circuit. By using the plug in type of transformer, the contractor reasoned he could minimize his losses by not having to access to the electrical panels and not having to tap into the electrical system.
Unfortunately, he never communicated the change in job scope to the association. It wasn’t until the new transformers were being installed that owners began making numerous complaints that the address lights were still not working. I was asked to come back and check the new installation and discovered unit owners were either unplugging the new transformers to get access to the garage outlet, or because the transformers were falling out or being dislodged from the electrical outlet.
When the association confronted the contractor about deviating from the agreed-upon scope of work, the contractor took the position that using a plug in transformer was appropriate, and it was not his fault that the transformers were being unplugged or dislodged. Yet, in reality it was his fault. Industry standards require essential devices such as address lights to be continuously on in order to assist emergency responders.
So how did this job eventually work out? Initially, the address light replacement was scheduled to take one to two weeks, but it ended up taking four months to complete. Instead of accessing each unit one time, it was necessary for the contractor to schedule access to all units three times over the course of the replacement. This created a logistical nightmare. The final cost to the association was almost twice the original bid, and the association was forced to deal with the delays and inconvenience of working with this contractor and numerous complaints from the unit owners.
Now let’s look at what the association should have done to make this work.
First
The association did not have a clear understanding of what was involved in the replacement of the address lights, nor did they prepare a clear description of the work they were requesting. The association manager merely asked the contractors for a price to “replace the existing address lights.” It was assumed that the persons bidding the work would know what to do and that the job would be done correctly. Had the association understood what was involved in changing the address lights or had the description of work included language such as, “work to match existing installation” or “according to industry standards or manufacturer’s installation instructions,” they would have limited liability.
Secondly
Someone should have checked the licenses of the contractors bidding work. Doing so is as simple as making a phone call to the Contractors State License Board or going to their website. In this case, the contract was awarded to a general contractor who was technically not licensed to perform just electrical work (installing the address lights). Contractor License Law states that a general contractor can only do work involving more than two trades. Technically, this job should have been performed by a licensed electrical contractor and not a general contractor. An electrical contractor would have known to check what type of power supply was needed for the new address lights before even bidding the job.
Thirdly
The work was not walked or reviewed with the contractor prior to the start of the job. Reviewing the work to be performed on a site walk with the contractor and representative for the association is a good opportunity to generate a clear understanding of what needs to be done, and how work will be performed. A site walk should be performed on every job request—large or small.
Associations and managers can best protect themselves from unwanted surprises by consulting with a construction specialist, project manager or architect to review the work to be done on a complex and to create an appropriate description of the work along with general expectations of the association. This is often done in the form of a request for proposal (RFP). Spending a few hours with a construction professional prior to starting any job has the potential of substantial cost savings and reduction in avoidable delays during the repairs or maintenance to a complex.
Associations and management companies should be developing relationships with construction specialists, tax advisors, and attorneys when any work is being planned or funds are to be spent. These professionals can answer questions, review documents, anticipate problems and provide advice and assistance necessary to make sure you are getting what you want and need.
As simple as these steps sound, they work and can limit liability exposure for boards and associations. Whether the job is big or small, make sure you and the vendor understand what is to be done and what it will cost. It’s always easier to resolve questions and uncertainties before work begins.
John R Schneider is a licensed general building contractor and certified code specialist. Since 1985, he has been president of All About Homes, Inc., an East Bay consulting company that specializes in the investigation of construction related deficiencies, the management of projects, and the facilitation of disputes between owners, associations, and vendors. Mr. Schneider is a member of the ECHO Maintenance Panel. Questions can be directed to Mr. Schneider at jrschneider@allabouthomes.com.