Q. We want to terminate a contract with a general contractor (GC). We have experienced payment issues with the GC since day one of a project. Every single pay application we send in, they manipulate without discussing with us, submit the lower number to owners on our behalf, and then come back and say, “Here is what you are getting paid.” As a lark, the GC’s project accountant moved a comma over and we got paid $4,200 instead of the $42,000 billed. They never mentioned it, and we never knew about the manipulation of our pay app until the lien release came at the lower number.
What makes matters worse is that it’s a prevailing wage job and they disregard our certified payrolls. These games go on every billing, and we are done dealing with them. We want out. Any ideas on how to terminate a contract with a GC would be appreciated.
—Trying to Break Free
A. “The first line of inquiry,” says attorney Norman Zlotnick of the Northfield-based firm Hyberg, White & Mann, “is to examine the contract between the GC and the reader. It may provide for mandatory mediation and/or arbitration in the event of a dispute. If so, its provisions must be followed. If there are no such provisions, the reader can advise the GC it is withdrawing from the job because of the GC’s blatant breach of contract, while at the same time filing suit for what the reader can prove it is owed. Unfortunately, this is the kind of case that usually ends up in litigation in court, unless, as I said above, the contract contains mandatory arbitration provisions. In any event, it usually ends up in litigation.”