Builder “forgot” to add Vat before contract signed!!

[Topsy]

Hi,

Having never gone as far as having a house extension built before, I tried to research the subject carefully. After successfully obtaining planning permission I then picked my building contractor with care, utilising one which specialises in traditional building methods. A neighbour also recommended them and I saw evidence of a high-spec build.

 

However, a few days after we had signed a JCT contract (I had a budget which the builder knew he had to keep below), the builder very casually mentioned to me that he had “forgotten” to add the VAT to the fixed price quote!!!!!

 

As you can imagine I hit the roof ......WTF???!! Quickly realising that he was already in breach of contract but knowing that I wanted to go ahead with the build I immediately sought to compromise and offered to meet him halfway. He declined, stating he was barely breaking even. To say that I feel completely cheated is an understatement.

 

Is  there any advice as to what to do now please? I felt that I had to forge ahead with this builder, especially during this very awkward year we’re all experiencing. I now realise that he is experiencing traumatic personal issues which I empathise with but it is clearly affecting his professionalism. On another matter I had very adamantly pointed out exceptionally bad drainage issues at my property, fully expecting him to have taken this into consideration at the costings stage. Alas, no and I have now just been hit with a further £4000 to cover this!!!!!!

 

i am now faced with taking out a mortgage simply to cover his appalling oversights!! Any advice would be welcome, thank you.

[Russell griffiths]

Don’t use him, simple. 

[TonyT]

Ask for a 20% reduction for working with a chancer.

 

forgot to add vat. Yeah right!

[DamonHD]

1 hour ago, Topsy said:

Hi,

Having never gone as far as having a house extension built before, I tried to research the subject carefully. After successfully obtaining planning permission I then picked my building contractor with care, utilising one which specialises in traditional building methods. A neighbour also recommended them and I saw evidence of a high-spec build.

 

However, a few days after we had signed a JCT contract (I had a budget which the builder knew he had to keep below), the builder very casually mentioned to me that he had “forgotten” to add the VAT to the fixed price quote!!!!!

 

I think that it may simply not even be legal to quote you a VAT exclusive price if you are a consumer, or even if as a business not make it clear.

 

Yes, I'd say he is in breach as a civil matter, but also quite possibly guily of fraud and various consumer protection laws also.  But IANAL.

 

Offer to let him cancel if he refunds any costs that you have incurred.  Do not let him start otherwise, as in breach and not from your pov being trustable.

 

Rgds

 

Damon

Edited February 23, 2021 by DamonHD

[Rob99]

1 hour ago, Topsy said:

However, a few days after we had signed a JCT contract (I had a budget which the builder knew he had to keep below), the builder very casually mentioned to me that he had “forgotten” to add the VAT to the fixed price quote!!!!!

 

I completely sympathise with your position if you had a fixed budget and this is now costing more than you expected. It sounds like he had other things on his mind and simply did not mention VAT and it's probably a genuine error.

 

Which JCT contract are you using, as that will determine how VAT is dealt with? If it's the homeowner contract then the stated price includes VAT in which case he will either have to do the work and cover the mistake or withdraw from the work. If it's any other JCT contract then the contract price will be excluding VAT.

 

I would be worried if he said he is losing money when you offered to meet him halfway as that suggests his margin is less than 10% which seems far too low.

 

Bottom line, it's never a good idea to struggle on when there is this type of early dispute. Best to part company and find another builder as you'll never be satisfied and will always be thinking he's just trying to recover his money with extras.

 

 

[Temp]

How did his quote compare with others?

[Mr Punter]

I think you will need to part ways.

 

It is not unusual for decent builders to get pricing wring and try to recoup it by charging extra.  Do you think he underpriced?

 

How far through the build are you?

[PeterW]

Who is your JCT contract administrator ..? Or have you downloaded the form and done it yourself...??

 

If its a homeowner JCT then it does state about VAT, if it’s a minor works then the assumption is ex-VAT but you can’t enter into one of those without a contract admin being appointed from memory.