Remodeling is by its very nature a contentious process. But there is no magic bullet to protect against run-ins with customers or, worse, with their lawyers. The best protection, many remodelers agree, is as simple as establishing the rules and then making sure everyone follows them.
“It's when systems and procedures are not adhered to that problems occur,” says Randy Ruzanski, owner of Distinctive Design-Build, Remodel in Roselle, Ill. “It becomes a bargaining chip for the client at the end of the project.”
Dett Otterbeck of Otterbeck Builders in Castleton, N.Y., agrees. “We're not huge, but the fact that we have things like networked computers separates us from the little guy,” he says. “It helps protect us because we are better at tracking and systems.”
Client satisfaction and liability protection are intimately related, says Terry Wardell of Wardell Builders. He believes that “as long as you deliver a good product with integrity, you've just created 90% of your protection.” To that end, Wardell says that it's important to educate clients and to point out features of particular materials ahead of time.
When issues arise, it is better to immediately communicate with the client and state a course of action. “Some clients react badly, but a majority react better than if you had ignored their feelings of frustration,” Wardell says.
Before he implements new systems, Wardell asks two questions. First, does it relieve the staff's stress? “If the staff is happy, they are more likely to follow procedure and keep clients happy,” he says. Second, does it enhance the client experience? Wardell has learned that if the client is part of the process, they are more amenable to finding a fair solution. “That is as important as signed change orders, making sure subs have liability insurance, or a lawyer looking over the contract,” Wardell says.
Lawyer Judith Ittig of Washington, D.C., firm Ittig & Ittig, which specializes in construction law, says that there are two main junctures where problems occur. One is at the end of the design phase, where clients are not clear about the final product or the final budget ( see “Design”). The second juncture is at the time of project completion, when clients bring up small items they did not address during the remodeling process. “They surface in a cumulative way at the end of the job,” she says, “and contractors have a hard time closing and collecting payment.” Ittig says that clients are often clueless about the extras they received during the remodeling process and do not factor that into their relationship with the contractor. She says that remodelers should communicate these extras to clients, and “make sure they know the value of that extra work” even if you're not charging them for it.
Protection at Each Phase Sales
Many remodelers try to prevent future problems by vetting new clients. If Wardell notices “danger signals,” he will turn down work. “You can spend every dime of profit on a bad client relationship,” he warns.
Paul Sullivan says that he should have trusted his instincts when it came to one of the worst clients he ever worked with in his career. “I saw it at the first meeting. He was only giving me a limited amount of time. He was callous and rude to his wife,” recalls the owner of The Sullivan Co., in Newton Highlands, Mass. The remodeler is also careful about what he tells homeowners during a sales pitch. “Don't promise perfection. Don't promise something cheap or fast,” he warns. Set expectations when it comes to things like dust. “Tell them you do not promise a perfectly clean jobsite. Tell them you'll do your best to contain dust and then tell them how.”
Contracts “The longer and more legal language you use, the more people shy away from a contract,” says Mike Gervais of Burlington, Vt.-based Prime Construction. “People do not read them. We keep ours at 6 to 7 pages. Using basic language helps customers feel you are not pulling one over on them.”
