I think he deserves to be compensated for his time. For this paycheck, I think he should turn over to you all of his notes and information he has collected. I think it would not just be taking advantage of him, but robbing him, if you didn't pay him. Additionally, let's say that in the future you are able to do it (pretend you won some money from the lottery or something). Wouldn't it be nice to have not burned this bridge?

I think $50 per hour is a reasonable rate assuming he did in fact spend 100 hours.

Fifty dollars an hour seems like a deal for a GC, but 100 hours of time seems ridiculous to me. I have a hard time believing he spent that much time on this project without actually doing anything. I also find it hard to believe that he would allow it to get to that point knowing that cost was a determining factor on whether you do it without some kind of agreement spelled out with you in advance.

I guess I'd ask for an invoice specifying how much time was spent on various things and then perhaps you can come to some sort of middle ground with him.

I agree with wi-sailorgirl about 100 hours being ridiculous. I mean, 100? Not 98 or 87? I also think you should expect a detailed invoice. However, I do not believe in meeting in the middle ground. If you did work for someone, wouldn't you want to be paid for all your time? It isn't fair to expect him to give you freebies, especially when you aren't going forward on the job. But it does look like he purposefully inflated his time in anticipation of you doing just that, and then he can come back and say, "Well, I spent 73.5 hours on this job", and so it wouldn't be as painful for you to pay him (because you originally expected to pay for 100 hours). Perhaps he is the type who thinks that if he pads the number in the beginning, he can actually get the correct amount in the end. Do you know what I'm saying? I hope that makes sense.

It is surprising that the GC didn't speak up sooner about the time he was investing. That in itself is a problem, and I'd question his experience on the basis of that issue. But if you've been at this for several months, let's figure that's 7 months, and call it 30 weeks. If he spent just 2-3 hours a week on your project, it would be pretty easy to get up to 100 hours. "Several months" is a long time and those hours sure do add up.

I've been on the other end of this equation with a client who cancelled a project after several months of large- and small-group meetings and extensive preliminary documents. The client was shocked that I had spent so much time on the project before they pulled the plug, but everything I did had been requested by the client. I was resentful as he11 when they asked for an accounting--but all the time was easily accounted for. It was a bitter experience for everyone.

I know you asked about protocol but all I can think of is - and I hate to sound like a lawyer, but did you have an agreement? Probably not. Was there an understanding that he would be compensated for his time whether the project went forward or not? Did you discuss this? Probably not. Did he tell you what is hourly rate was, and did he give you updates of many hours he had put in? I doubt it. He really has an obligation to as a professional to disclose this, and not just ask for compensation after the fact.

A few years ago we had an aborted project (I got laid off). But the GC clearly told me what is hourly rate was for consultative pre-contract work.

There is always a certain amount of work to develop a bid and larger jobs such as yours would naturally require more work. I do not think that he should be paid for that, including sourcing of materials such as adobe. But I do think it would be reasonable to pay him for is hourly work clearing property setbacks with the county, and the meetings with the architect. Can't imagine that would be exactly 100 hours, however, or even close. You could easily calculate what this amount is, I would guess.

I agree with 10kDiamond. We're in the process of choosing a GC for a major remodel, and the contractors have all put in a lot of work to create and revise their bids. This is not something we pay for, rather the winning bid gets a contract from that point on. It's the nature of the job (and many other jobs, btw) that one can put in many hours of work and wind up "uncompensated," unless you win the project.

However, if you had a different understanding with this contractor, or if he went above and beyond with your consent, then I think he should be compensated.

The 100 hours of work is ridiculous, given that there was no signed agreement. Even if you were able to continue with your project, I'd suggest better communication at the very least, if not a different contractor.

As 10kDiamond said, contractors expect to put in time on a bid and perhaps lose. However, it sounds like this contractor went above and beyond by working with the architect and the city on property setbacks.

There should have been better communication, but I do think the right thing to do now is to pay him for his time. If you think the amount of time or the hourly wage should be negotiated that's up to you.

I wanted to say that it doesn't sound like the contractor was actually part of a "bidding" process.

A contractor doesn't visit the county/city or go to multiple meetings with an architect in order to send in a bid. it sounds like this was the GC she was actually working with on her job.

The reasonable-ness "test"

In the end, they opted not to follow through with the addition because the cost estimates were coming in at 250,000 dollars. I think that number needs to be taken into account as we look at his 5,000 dollar/100 hours estimate. First, the 5,000 dollars is only 2% of the job. To put it in perspective, someone who was considering a 20,000 dollar remodel would only be looking at a 400 dollar charge.

As for the 100 hours a job of that scope is going to involve many hours of work in the design phase even if the contractor isn't doing the primary work on the design. Scoping and pricing materials is a time consuming process all on it's own but especially on that scope of work. Add in multiple meetings and working with local government and I think it's a very reasonable number.

Now, normally, once you and a GC are on the same page you've alread gone through most of those processes with your architect and designer so they haven't got the time outlay into this situation. Or if so, there is an arrangement thats been discussed.

If your GC hadn't been speccing materials and taking the meetings with the city would you have been paying your architect and such to do it in his stead? Someone would have had to do it right? Would those people, designers and architects have charged more than 50 an hour?

It's an awkward situation but I feel like the numbers are reasonable. Kudos to you for not trying to get his work for free!

Based on the information you've provided so far, I assume that you did not have a written contract with the GC or provide other direction to the GC that would have implied a contract.

Most of the things you listed are customary and expected from a GC trying to win a bid. A GC needs to determine whether the materials are available and the pricing in order to bid so none of that is reimbursable. Setback questions can be answered with a simple phone call so that is not an issue.

The remaining issue is all the meeting time with the architect. It is unusual for a GC to spend that much time in meetings. But if the architect requested he attend the meetings without your specific direction then that's the architect's issue.

Unless you provided specific direction with a compensation agreement then everything he did was at risk. Winning business requires time and most GC's don't win most of the projects they go after. Contractors don't get compensated for preparing a proposal unless specifically stated in a written contract which seldom occurs.

It was up to him to decide how much time and effort to put into winning your business. You are under no obligation to pay anything or to even answer that request.

I think you are being fair, and I'm a big believer in karma.

I'd ask him, in a nice way, to document his out of pocket expenses and the time spent ( eg, attend zoning meeting, 2 hrs). I'd compensate him all actual expenses, and work at the rate of $25/hr. Why half? He had no contract and you had no idea the meter was ticking.

Zero is bad karma, but 100% is bad business.

$50/hour is a very reasonable rate for a GC. I really dislike the suggestion of cutting his rate in half. If the OP wants to have the time documented, or wants to negotiate to pay only half the GC's time, that seems more reasonable than telling a guy who has put a lot of good work into the project that his time is worth half of what he thinks it is.

Frankly I think it's insulting and unfair. Definitely NOT good karma.

Agree. Don't ever argue with someone's hourly rate after the fact (says someone who charges an hourly rate). You can dispute hours, or even dispute any obligation to pay at all, but don't argue the rate is too high. It isn't, anyway.

Thanks, everyone, for all your input. It's really helped us decide what to do. This wasn't really a run-of-the-mill project because the original house was built with adobe from the property in 1940 or so. CA doesn't allow adobe construction anymore, but a new addition can't be tacked on and not match what's already there. The solution is an adobe facade on a really thick wall and windows made to match the existing, but a GC really needs to have worked with adobe in the past to get it right. And this really adds to the cost! This GC has done lots of adobe over the years - did I mention he just celebrated his 83rd birthday? That's why this has all been a little on the different side.

I did ask him about payment early on and he kept saying "not yet," it comes with the job. We've never thought we would just take advantage of him and we did have high hopes that the project would come in at a price that would work. We also feel that his specs were quite accurate and his profit margin very fair.

With your help, we've decided to pay him his asking price, but half now and half soon - we didn't, after all, take out the loan we anticipated. In return we'll get back architect's plans and whatever other paper work he has. We have no bad feelings and I don't think he does either. It was just a bummer that it didn't work out. Thanks again for your input, it really helps to think things through.

Suzannesl,

I think that's a really great decision! I'm sorry that the cost sort of snuck up on you but am glad you opted to go that route.

Sometimes it can seem to me that doing the legal or required thing is often not the reasonable or fair thing. Don't even get me started on the fairness of our current legal system ;)

Your house sounds great! I bet it's spectacular and I can totally understand why you'd be looking to put all that work into it in order to continue the look. Feel free to post some pics!

M.