Running the Business · Part 3
Case: the change order that was never written
A whole-house repipe at $16,400 grows by $2,350 over nine working days: a relocated washer box, a second hose bibb, a rerouted line around a beam nobody knew was there, and an upgraded shutoff the customer asked for while standing in the garage. Every addition was requested, every addition was agreed to, and every addition was verbal. At the final, the customer pays the contract price and disputes the rest, holding a signed notice that says an unwritten change order is not enforceable against her. This case follows the four changes to the final invoice, the small claims hearing, the CSLB complaint that came out of it, and the nine days as they would have gone with a change-order pad in the truck.
What the full lesson covers
- Four verbal changes worth $2,350 became four unenforceable claims the moment the customer chose to dispute them, because the contract she signed said so (7159(e)(3)).
- The "unjust enrichment" sentence got the contractor a small claims hearing and $1,100 of the $2,350, less a day of lost work, after a judge heard both sides guess at the value.
- The complaint to CSLB was not about the money; the investigator cited the missing change orders under 7159(a)(5) because the missing paper was a violation whether or not the customer paid.
- The final release the customer demanded carried a blank for "disputed claims for extras"; the contractor left it blank and released the extras he was still fighting over.
- Three minutes per change, on the pad, before the work, would have produced four signed documents and a final invoice with nothing to dispute.
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More lessons in Contracts and Getting Paid
- 1The home improvement contract (B&P 7159): every required element, the exact notices, and the three-day right to cancel
- 2The deposit cap: $1,000 or 10 percent, whichever is less, and progress payments that cannot exceed the work. CSLB's most common citation
- 3Service and repair contracts (B&P 7159.10): when the short form applies, what it must say, and how a service call falls out of it
- 4Subcontracts with GCs: the twelve clauses to read, what to strike, and what to negotiate
- 5Change orders: written, signed, before the work. Every time. Why verbal ones end in CSLB complaints
- 6Mechanics liens I: the 20-day preliminary notice. Miss it, lose your rights
- 7Mechanics liens II: recording deadlines, the 90-day foreclosure clock, the four statutory release forms, stop payment notices, and payment bonds on public work
- 8Collections: demand letter, lien, small claims, attorney. When each is worth it, and the one thing that makes all of them impossible
- 9Taking payment: cards, ACH, checks, cash, financing partners, and getting every dollar into the right account
- 10Case: the job that went unpaid. Where the contractor lost lien rights and how to have kept them
- 11Case: the deposit that became a citation
- 12Case: the change order that was never writtenYou are here
- 13Template: the home improvement contract, with every B&P 7159 notice verbatim
- 14Template: the service and repair contract (B&P 7159.10), one page, with the notices verbatim
- 15Template: the change order, one page, signed before the work
- 16Template: the 20-day preliminary notice, with the proof-of-notice declaration
- 17Template: the four statutory lien waiver and release forms (Civil Code 8132 to 8138), verbatim
- 18Template: the demand letter, homeowner version and general contractor version
- 19Template: the subcontract review checklist. Twelve clauses, three boxes each