Question: Close-out documentation A general contractor has successfully completed building a shipping and receiving facility. This project was initially procured as a competitive lump sum bid
Close-out documentation A general contractor has successfully completed building a shipping and receiving facility. This project was initially procured as a competitive lump sum bid project. This was a fairly simple $10 million, 100,000 square foot tilt-up concrete facility. Total construction time was seven months. The owner, contractor, and architect have all worked well together throughout the project. All payment requests have been approved and paid on time. All change orders have been negotiated and incorporated into the contract. This owner apparently will have other similar projects coming up throughout the country and is interested in hiring the general contractor on a negotiated basis to provide all of their construction needs. The contractor has combined the last-progress payment request for $100,000 with a request for retention release of $250,000 for a total $350,000 final payment request. The general contractor moved their project manager off the project during the last month of the schedule and has turned over the close-out of the project to a new project engineer (PE) fresh out of college. The project engineer has had a difficult time getting the close-out documents together, especially the operation and maintenance manuals. The subcontractors are not responding with all of the required information. The architect has twice rejected the O&Ms. Two months have now passed since completing the punch list work and receiving the C of O from the city. The owner is now refusing the requested payment for $350,000. The architect has suggested that the general contractor separate out the last month's $100,000 that is due and request that under a separate payment invoice. The project engineer is being stubborn and is refusing. What mistakes has the general contractor made? What can they do now to remedy the situation? Can the owner contractually hold the full $350,000, and if so for how long? When will the general contractor's (and the subcontractors') lien rights expire? Is there any chance these parties can (or should) enter into a long-term national agreement? Close-out documentation A general contractor has successfully completed building a shipping and receiving facility. This project was initially procured as a competitive lump sum bid project. This was a fairly simple $10 million, 100,000 square foot tilt-up concrete facility. Total construction time was seven months. The owner, contractor, and architect have all worked well together throughout the project. All payment requests have been approved and paid on time. All change orders have been negotiated and incorporated into the contract. This owner apparently will have other similar projects coming up throughout the country and is interested in hiring the general contractor on a negotiated basis to provide all of their construction needs. The contractor has combined the last-progress payment request for $100,000 with a request for retention release of $250,000 for a total $350,000 final payment request. The general contractor moved their project manager off the project during the last month of the schedule and has turned over the close-out of the project to a new project engineer (PE) fresh out of college. The project engineer has had a difficult time getting the close-out documents together, especially the operation and maintenance manuals. The subcontractors are not responding with all of the required information. The architect has twice rejected the O&Ms. Two months have now passed since completing the punch list work and receiving the C of O from the city. The owner is now refusing the requested payment for $350,000. The architect has suggested that the general contractor separate out the last month's $100,000 that is due and request that under a separate payment invoice. The project engineer is being stubborn and is refusing. What mistakes has the general contractor made? What can they do now to remedy the situation? Can the owner contractually hold the full $350,000, and if so for how long? When will the general contractor's (and the subcontractors') lien rights expire? Is there any chance these parties can (or should) enter into a long-term national agreement