contractor overcharge

You m

You may be able to buy he AC equipment for 3K, but there are installation costs that include both labor and extra materials required. Ask a plumber to replace a faucet on your sink and the actual bill will come to several times the cost of the faucet.

the total bill for ac system was 200k

material overcharge 300-400%, subcontractor charge was 25k , bill to the owner was 118k etc

What can you do ?

Who besides the owner was reviewing this stuff and authorizing change orders or payments? Architects? Attorney? Other professionals? Surely before spending seven figures it was not just the contractor plus an owner inexperienced in major renovations?

At this point, there are specialist construction auditing firms that work on contingency (a healthy % of recoveries) and might be interested if you can give them an initial demonstration of the scale of overcharge.

And what about a mechanism for recovery -- is the contractor holding all this cash now, or does the owner still have a sizable chunk they 'owe'?

I have seen estimates with stick on smoke alarms for $500. Most contractors are legit and have a conscience, but some will see how rich you are and how much attention you pay to detail and charge accordingly.

It was architect , who received 10 % of the total contract $ and who is overseeing it now as well, and contractor/manager co.
BTW , contractor was recommended by architect.
Also we are talking about $$$$$ mln contract, $$ paid already. 40-50 % work completed.
what can we do now? any chance to recover those money?
Strongly suspecting fraud here

NYC2015Question,

To answer your question, it depends on the situation. Did the contractor submit a change order for these items? Did the client ok this items? If the owner approved these items there is not much you can do. If the contractor purchased and installed this changes and then billed the owner thats a different story. What kind of contract was it? If it is (I doubt) time and material then there should be some recourse.I the architect was in charge of budget there should be some recourse as well

Beat the crap out of your architect. it looks like you may be paying your architect more than $200k. Most architects are not very good commercially except when charging you fees. Once architects, contractors, and designers smell money, they will bilk you. Do not blame them. What is in the contract?

BTW, what is the total estimated project cost?

6 m

In that case, if the the architect is making 600k, certainly beat the crap out the architect as long as the architect has contract administration responsibility. Please do keep in mind that change orders are how the contractors make money but in this case, it seems to be a bit much. If nothing else, you will get some peace of mind by understanding the charges. As an individual, contractors and architects do try to bilk you as you are unlikely to do a reno again anytime soon.

There are specialist construction auditing firms that work on contingency (a healthy % of recoveries) and might be interested if you can give them an initial demonstration of the scale of overcharge.

300 Mercer,
"As an individual, contractors and architects do try to bilk you as you are unlikely to do a reno again anytime soon." Try to bilk you? How did you come to this conclusion? As a contractor I would like nothing more than having no change orders on my project. I find that I usually charge too little with change orders and as each change his made the projects timeline increases. I recently finished a project that was 800k and we had one change order as my client added an additional piece of millwork for 7k. Were there other changes? of course but they were minor and we didnt charge anything for them. As far as bilking client because they will not be doing a project soon, that is another idiotic statement. Our business is all about referrals and word of mouth. I think most good contractors feel the same way so we do the best we can so the client is happy and would be happy to refer us to a friend

Go for the architect, he's feeding the beast. To be fair, in his head/way of doing things, obscene mark up may be the norm. When you have high end projects, the contractors and architects operate at a diff level. The "Ive worked with this contractor before..." line can be a source of comfort, but also concern. Your 50% in, good your catching on now, wold be even more difficult after you finish. It will be messy but draw some lines and demand some satisfaction. If he is legit, you will make headway as both contractor and architect dont need bad word of mouth slapping their rep around.

Primer, Sorry, did not mean to offend you. Contractors do care about referrals. I should have said try to make as much as possible once they know that you have deep pockets rather than bilking. In my experience, the charges for the contractors do vary depending on how deep your pockets are as they think you may not notice. It is no different from Drug Stores offering coupons. Hence, the person with deep pockets needs to watch more.

300 Mercer,

I am not offended from your opinions. making as much as possible once they know that you have deep pockets rather than bilking is bilking, no? The contractors I know including myself do not work that way. We have set price guidelines we use when we price out projects as well as change orders. The only difference in prices between a person with " deep pockets" and one that doesn't might occur if they live in a very hi end property were the rules of the building causes our costs to go up other than that if the scope of work is the same the price would be the same. I think the business I am in is the same as any other. An attorney could charge a person that he thinks has a lot of money more than someone else same as just about any other service business.

Just an example,In our case, cost for subcontractor if we go directly the same job was quoted 25k, but contractor itemized it and charged us 118k. So we are talking about 400% not 30%.

Is there a contractor "black list" out there?