Legal Question in Construction Law in California

If you have a "not to exceed" price structure, you can legally insist that all the work be done within the ceiling price, subject to possible extra charges if you approve any change orders. As to organizations that will assist you in auditing a contractor's bill, I think about the closest you will come is the Contractors State License Board, which allows filing complaints on-line or by mail. Try www.cslb.ca.gov and click on the consumers tab. Nevertheless, I suggest you try negotiating (pleasantly) with the contractor before making a complaint; there may be a simple solution.

Mr. Whipple is correct, the way a not to exceed clause is enforced is simply not to pay any more than the agreed amount, unless there is an agreement to add work and if that is the case you should agree on a new NTE price. If you don't, however, the burden is on the contractor to prove you had an implied agreement that the change in the work would increase the NTE price.

As for the billing irregularities, it is illegal for the contractor to bill for anything not actually done. Sometimes that is just sloppy record keeping or lazy billing by contractors who use a generalized schedule billing rather than confirm work in place. In too many cases, however, the contractor is billing Peter to build for Paul, meaning he has already hit his not to exceed on another job, and so he is billing out ahead on your job to get money to finish the other one. This is all to common, where the contractor keeps counting on the next job to provide the money to finish the one that is underway. In either case, Mr. Whipple's advice is sound. First pleasently seek a correction of the billing.