, if the existing contract is legal and fully notarize and does not mention anything about retention, then your not in any way obligated to provide for a retention fee. most likely, the owner just realize this and wants to add it to your agreement. it's up to you to agree or not but if you do, you need to make an addendum to the contract.

the years of the retention and the amount of the retention must all be clearly spelled out explicitly in the contract. The reason for this is both parties would like to have the opposite side ... e.g. owner prefer a high retention fee and a longer period ... contractor will always like a low retention fee and a shorter period of time. i suggest you talk to your other contractor friends and find out the normal percentage for the retention fee and the period of time.

if the amount of the retention fee is quite big, you should ask for an interest for it during the retention period. think of it as a cost for you because you can't use the money for something else because most likely the owner can use the money for something else while the retention period is in effect. you can use the time-deposit interest as a basis for the interest earned on the retention fee amount that will be given to you at the end of the retention period.
if the owner does not agree to the interest and your still OK to have it, then ensure that the retention fee money can not also be use by the owner for other purposes. you can put it in an escrow account (with interest earned 🙂 he he he) with a bank, this way, both you and the owner cannot touch the money for other purposes except in case there is a defect in the construction during the retention period.

also advice the owner that there can be other cost involve in case of defects of the construction. it's safe to assume that a contractor will not immediately admit that the defect was due to the construction. it could be due to some other factors like natural cause or misuse of the owner. for this, it can only be resolve thru a civil case if both parties cannot resolve it on their own - civil case will involve lawyers and most of the time, a condition is always included in the case that the loser will pay for the legal fees of the other party.

hope this info helps ... cheers

Boo!

Sa construction lagi meron 10% retention fee . Eto yun 10% ng project cost na pwede mo lang masingil sa Owner/client after you completed the project.

Normally we give 1 year warranty against materials and workmanship defect.

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thanks for the info on the local standard related to retention fee ... cheers

Boo!

Don't accept any construction project pag medyo mababa na yun presyo na gusto ng Owner. In the end baka mag-away lang kayo.
Always built have a harmonious relationship with the Client/Owner kahit lugi ka or break-even dahil sila rin minsan ang nagbibigay ng project/referral.

" ilang years po ba ang liability ko dun sa bahay as contractor at kailangan ko bang bayaran yung retention kahit na maliit lang yung project at wala naman siya sa contract?"

As I mention retention fee is 10% of the Project Cost. Pwede mo lang siya ma-bill sa Owner after you completed the project. Gawa ka ng Certificate of project completion pasign mo sa Client/Owner. Stated on the certificate that you give a 6 mos or 1 year warranty against Material and workmanship defect.

There are case na si Client/Owner gusto makasigurado na babalikan ni Contractor yun project for warranty claim. Pwede mo siya bigyan ng "Surety Bond". Meron kse mga Contractor na after matapos yun project hindi na binabalikan yun mga for repair.

" ilang years po ba ang liability ko dun sa bahay as contractor" - If I'm not mistaken 15 years for the structure itself. Always follow the plans. If you construct the house based on plans wala ka magiging problema as long as tama yun nakalagay sa plan. Be sure it is signed and sealed by the respective professionals before you execute it. Always have your materials like concrete and steel tested by a third party. Mura lang naman yun material testing. At least you have a supporting documents that it passed the standard.

a very good advice to contractors on material testing especially on the critical materials like concrete and rebars. owners will feel more secure and it's a plus factor to the contractor's reputation for quality ... cheers

Boo!

maraming salamat po SIr Boo and Sir Bryant, andami ko natututunan sa inyo, sine save ko lahat yang mga sinasabi nyo hehehe, isang tanong pa po sana, ano po ba ang matimbang, ang plano o ang perspective in terms of legal matters, yunh owner kasi pinapabago nya yung part ng facade kase medyo hindi daw kamukha nung sa perspective , yung stones daw na nilagay ko ay hindi kamukha nung sa perspective pero same quality lang naman sila, naubusan na kasi ng supply dun sa gusto nya, at inadjust ko ng kaunti yung shape nung kwarto na base sa plano pero iba sa perspective, yun po kasing 3d designer ko ay may mga input o improvisation minsan na wala sa plano na lumilitaw sa mga drawings nya. pero ang sinundan ko ay yung nasa plano pa rin at hindi yung sa perspective, ill charge this for experience para next time mas maagap nako, salamat po

When it comes sa technical aspect ng construction we follow the plans. When it comes to finishing we present sa Owner yun mga swatches . Eto yun actual paint color, tile or stone sample. Then mag sample ulit kami ng actual sa wall or floor na lalagyan ng finishes. Then yun approved sample pinapa sign namin. In case nakabit na namin yun mga finishes tapos pinabago ng owner we have documents na approved ng owner and we can charge him sa expenses due to changes.

When it comes sa perspective, kung ano yun layout sa plans yun din ang magiging perspective namin. As much as posible yun ilalagay mo na materials sa perspective ay yun mga available sa market. YUn mga client kse hindi nila tinitignan yun plans. Mag base sila sa perspective na ipresent mo. Kaya kung ano yun nasa perspective yun ang hahanapin nila.

, perspective are prepared primarily for persons (most of the time the owners) with no technical background in construction. although technically, a house plan will have a higher weight compared to a perspective, it does not mean that in a legal dispute it (plan) will always take precedent over a perspective. the issue here will be on how big is the difference between the 2 documents and if that difference (intentional or not) constitute an infringement of the contractual rights of one party in a contract. litigation is messy, so try to avoid it as much as possible :-).

to avoid any future dispute with the owner, whatsaid in his reply is the best process to follow - show sample materials to owner, do a mock-up, QA actual work, and have the owner sign at each stage. actually, this is also how it's done in a major construction project between the consultant (owner's QA) and the main contractor (builder).

as for the 3D software that you are using, you need to find out (and correct) the reason why those things are happening - 'input o improvisation minsan na wala sa plano na lumilitaw sa mga drawings nya'. otherwise, you could have the same problem again in your next project ... cheers

Boo!

Last question po sir boo and sir bryant, eh mag ti-3 months na po magmula nung magstart construction at patapos na kami, at 4 months lang talaga habol ko dun sa bahay sa completion at ang linaw na napag usapan na namin yon ng owner, pero nakalagay dun sa contract namin is ""shall satisfactorily complete the work within 6 months
from the date specified in the Notice to Commence Work.""" so nanghihingi na po ako sa kanya ng particular amount para matapos ko within 4 months, then sabi nya dapat daw 6 months ko tapusin yung bahay at 3 gives daw bago nya maibigay yung full payment sa 6 months, which is 2 gives nalang at mas malaki kung ibibigay nya within 4 month completion, hindi ko naman pwedeng pahabain ng 6 months kasi malulugi na po ako sa labor, ang tanong ko sana sir boo and sir bryant, entitled ba ako na mag set ng completion date basta nakapaloob sa 6 months na nakasulat sa kontrata?

, pre, i hate to say this, but i think the reason for all the issues you have right now with your project is because ...

(1) the way i understand your posting, it seems that it's the client who prepared the contract for your project which should not be the case. as the service provider (contractor) it is your responsibility to prepare the contract, this way, you don't get any surprises after it has been signed. if there are any changes (that you have agreed with the client) that needs to be done, you make the changes after consulting with your lawyer. from my experience with contracts and negotiations before, if the company i work for is the client (), then what the contractor will do is take note of all the agreements in all the meetings and consolidate everything in the contract.

(2) worst, it seems that, to get the project, you signed a contract without really giving some time for you to understand the details of the contract, most important of which are the provisions in the contract that are disadvantageous to you as a contractor.

the 2 are like a double whammy to your business. try to avoid this in the future as it's bad for your business noh 🙂 ... as the service provider you should have complete control in the preparation of the contract.

pre, as to your question of an early completion date before the 6 month period. you can do it but it does not mean that the owner is obligated to pay you earlier. that depends on what are the other info stated in the contract. normally it should have a clause for terms of payment relating to early completion or the reverse of it, penalties for delay.

i recommend that you get some legal advice from your lawyer about the contract before sending a notice (early completion) to the owner. it has a lot of implications which a lawyer can really advice you on your legal rights. things like, what if the owner does not accept it, removal of all the temporary structures and equipment from the premises, clean up of the premises, and most important, whether the owner is obligated to pay you immediately or not.

moving forward for your future projects, i highly recommend that you take some time and really sit down with a good lawyer to come up with a standard contract for your clients. you only pay the lawyer once to prepare it and once you have the soft copy, you can just print it with the basic info and your safe provided you don't change any of the terms and conditions written in a legal jargon that i also have a hard time understanding 🙂 he he he ...

i'll try to search for my notes on the last software development contract that i was involved with before and share it with the group on some of the things to take note in dealing with clients as a service provider ... cheers

Boo!

Maraming salamat po sir boo sa mga advice and i must admit na im i'll prepared for this one, eto po kasi yung 2nd undertaking ko as gen contractor, yung nauna ko eh yung bahay na ginawa ko sa pinsan ko which is very informal yung transaction, wala kami contract,walang progress billing and it went well naman, kaya nangangapa ako ngayon dito, anyway ako naman po yng gumawa ng contract, meron po talaga kaming naka set na progress billing dun sa conditons namen na 7 days after ma issue yung progress billing eh obligado na magbayad ang client though hindi ko na sinundan kasi i want to make it as informal as it can be, kung ok lang po sa inyo send ko yung copy nung contract so you can comment more sir boo? and tulad po ng sinabi nyo kukunsulta po ako sa legal expert para malaman ko yung gagawin ko.

, i'll be more than happy to read the contract and give you my comments. but you still need to get a legal advice from a lawyer. send me an SMS on this mobile number +63-947-0511218 and i'll reply with my email address ... cheers

Boo!

hello po ulet, sorry for the delayed response Sir Boo na busy lang hehehe, update ko lang po, so nasa 70% na accomplishment namen in almost mag 3 months pa lang naka pintura na at linalagay na namin yung yero, then yung terms of payment po namin dun sa contract eh as per progress billing at obligadong magbayad yung owner once na issue na ng contractor yung billing within 7 days, kung magbabase po kame dun sa progress bill eh kailangang ibigay na nya lahat yung remaining amount sa contract but ayaw paring magbayad ng owner ayon dun sa progress bill, ang ginawa po nya eh monthly sya nagbabayad ng tig 300k, which is nung first two months pinagbigyan ko pero ngayon 3rd month hindi ko na ma pagbigyan kasi nga nagkanda utang na ako sa mga hardware hindi lang mahinto yung bahay, ano po ang maipapayo nyo ulit saken mga sir, hindi pa po ako nakausap ng attorney.ayaw ko namang makipag usap dun sa client sa isang confrontational na manner ang sabi ko sa kanya naiintindihan ko sya kaya binibigyan ko sya ng option na 50% na muna nung remaining contract amoung ang ibigay nya, pero hindi daw nya kaya talaga ,dinadahilan pa nya is dapat daw 6 months ang usapan, ang sabi ko naman regardless kung 6 months o hinde eh obligado syang magbayad parin ayon dun sa progress bill. pasensya na po kayo sa kulit ko mga sirs.