March 31, 2019
By Bob Incollingo
When an ordinarily calm contractor and homeowner disagree during a project, either one or both may find himself shaking with anger and frustration. In my experience, homeowners and contractors routinely talk past one another, with neither one giving the other the understanding they feel they are due. We could call it “the invisible nail pop syndrome,” an otherwise humorless situation where values are seriously out of skew. When problems on the project don’t rise to the level of major breach by the contractor, but are still short of the owner’s expectations, I may advise the homeowner to hire an owner’s representative to oversee continued construction.
Although a homeowner will most often be reluctant to take on additional expense in the absence of a problem, it is my opinion that for a project of significant size, the budget will bear the cost of an owner’s rep. Rarely is a homeowner knowledgeable in construction practice. More rarely still does a homeowner have the time to cope with problems and keep a project on schedule. A separate contract between owner and the owner’s rep meets the real need for oversight, and may spare everyone a mountain of aggravation.
Also, the additional expense will be a lot cheaper than litigation in the aftermath of breach. An owner’s rep does not need to be on the project full time, but should be on call, and on site as often as required, in his discretion, to monitor workmanship and to see the project delivered on time and according to plan. Here is a clause to provide for an owner’s representative in the home improvement contract:
8. Owner’s Representative. Owner may appoint a third party representative to act on her behalf in monitoring the progress of the Work, and in communicating with the Contractor and third parties with respect to Owner’s interest for the timely and sufficient performance of the Work under these contract documents. Owner will designate her representative in writing and provide contact information for her owner’s representative to Contractor promptly upon appointment. Contractor shall communicate openly and promptly with Owner’s representative for all purposes relevant to the Project, and the representative shall have free and unlimited access to the Project and to all contract documents and project-relevant records of the Contractor upon demand during the pendency of the Work. If upon request of the Owner’s representative the Contractor fails to correct Work which is not in accordance with the Contract Documents, at Contractor’s sole expense, Owner or Owner’s representative may direct the Contractor in writing to stop the work until the correction is made. If the Contractor fails within a seven day period after receipt of written notice from the Owner or Owner’s representative to correct such default or neglect with diligence and promptness, the Owner may without prejudice to other remedies, correct such deficiencies. In such case, the Contract Price shall be adjusted to deduct the cost of correction and related charges by the Owner’s representative in overseeing such correction, from payments due to the Contractor.
FAIR WARNING: Pay your owner’s representative. Under New Jersey Lien Law, a construction manager who is designated as an owner’s agent can be considered a “contractor” with lien rights against the project. N.J.S.A. 2A:44A-2.
South Jersey construction lawyer Robert J. Incollingo is a Director of the Camden Business Association, and practices construction law, business law, and real estate law in Gloucester County, Burlington County, and Camden County, New Jersey from his office in Cherry Hill. More articles like this appear on RJILAW.com.