MDCI were called in by a foreign client who undertaking a luxury villa development in Spain. He was building his own villa in one of Marbella’s most prestigious urbanisations and was concerned that they had already paid a big downpayment and costs were spiralling. This client had already contracted a constructor who had been recommended to him by his estate agent. He had agreed to work with this constructor, without putting the project out to tender, therefore was not able to compare their terms and conditions with any other valid candidates.
The builder requested a 20% downpayment on the total costs quoted for, which the client paid to start the project. However, the client neglected to ask the builder to repay in tranches during the period of the contract by deducting from the monthly bill, nor to provide a Bank guarantee. You can imagine that the builder could not believe his good fortune! This issue was compounded when the client decided to upgrade the specifications of his project and request a revised quotation. The builder, sensing an opportunity, provided a revised quote for the whole remaining works, rather than just the requested change. This was in contravention of the terms of the contract and it was this unexpected price increase, across the whole project, that led the client to call in the project management experts at MDCI for help.
When coming into a project rescue situation such as this, we start by taking stock of the situation and reviewing all the contracts and documentation. We quickly identified certain defects in the Project documentation prepared by the architect, which enabled the builder to present higher than necessary quotes. We requested that the architect corrects these issues and that the builder requote. However, he refused to do so, or to return the 20% advanced payments, which he claimed he had “spent”.
At this point we recommended that the Constructor be ejected and his contract be rescinded and this was duly done. We also advised the client to start a legal claim against the construction company for the non-return of the money and the non-compliance with the terms of the signed contract.
To get the project back on track, we needed to get back to basics and start from solid ground. We corrected the technical documentation and circulated these to three alternative constructors for quotation. The specification document was sent together with our secret weapon, a copy of our tried and tested construction contract which we have used since our Marriott Resort times and offers unbeatable protection and peace of mind. Once the quotes were submitted, we helped our client to make the decision on the new constructor and ensure that the contracts are signed and the payment terms were correct. We were then able to leave our temporary project monitoring assignment, knowing the client is in safe and capable hands.