Legal Question in Construction Law in Georgia

How to terminate residental construction contract

We have a general contractor building a home for us who has clearly

breached our cost plus contract. He missed the completion date in the

contract by almost 90 days (and three verbal ''extensions'' of that date) with

no definite completion date in sight. He has failed to secure the property

against loss - even though we have lighting and appliances installed, the

house still doesn't have a locking front door. He is 16% over budget (almost

$50K) and is refusing to let see any of the invoices that would document why

we are over budget. He says that we are holding up the process becuase we

won't pay him the money that he needs to keep the project going, but we

have approved every draw request made within 24 hours (including a $34K

emergency increase in our loan and $17K in cash that he needed to

meet budget overages). We have made NO change orders at all - the house is

being built exactly as drawn by our architect and according to the detailed

scope of work prepared by our architect to aid in budgeting the job. We are

now going to miss a final deadline that will cause us to lose our favorable

financing and leave us homeless as our rental is no longer available. How do

I cut this loser loose?


Asked on 3/06/06, 4:04 pm

2 Answers from Attorneys
Jon Gottlieb Flynn & Gottlieb, P.A.

Re: How to terminate residental construction contract

Unfortunately, this is not an atypical problem. The method for terminating your relationship with your contractor should be spelled out in your contract. However, without first reviewing your contract I cannot accurately identify your rights. I suggest you let a construction attorney review your contract.

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Answered on 3/06/06, 4:09 pm
Glenn M. Lyon, Esq. MacGREGOR LYON, LLC, Business Attorneys

Re: How to terminate residental construction contract

Look to the terms of your contract. If the contractor breached the agreement, you will usually have the right to terminate the contract. However, there often cure clauses in contracts where the breaching party has a certain amount of time to cure the default.

If you would like to discuss any issues further, please feel free to contact my office. My contact information is below. Thank you.

The foregoing is general information only, not specific legal advice. No attorney/client relation has been created or should be implied.

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Answered on 3/06/06, 4:17 pm


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