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Unsuccessful bidder wants to be paid for bidding


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Mancong's Forum Posts: 31
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By Mancong in Seattle, WA on 7/5/2007


We are going to building a small vacation house.  Due to limited budget and our schedule, we are going to hire a contractor for site work and building shell.  We'll do the finish work.

We got two contractors interested in this project and they gave us prices.  We selected one of them.  After the unsuccessful bidder was notified, he sent us an invoice for "consulting, planning and estimating fee" $500.

Since the beginning, we made it very clear that we invited 2-3 contractors to bid on this project (only got two) and we would select one from between them.  They were both aware of each other's existence. We have email correspondence with the unsuccessful bidder to prove it.  We never entered into any contract with him and he never mentioned the "consulting fee" before he sent the invoice.

Here are our questions:

1. In residential construction, is it common for the owner to pay for bidding?
2. If we write back and tell him that he doesn't have legal grounds to charge this non-existent "consulting fee" and we will not pay anything, what options does he have if he is determined?  What are we facing?
3. If we write back and tell him that he doesn't have the right to charge the "consulting fee", but as a good gesture, we will reimburse part of his time, will this even work?  Or, will it make the matter worse?  I'm afraid that it will encourage him to come after us, or by doing so, we legally admit that we are in a contract which never existed.

We would like to hear from other O-Bs.  Your thoughts, ideas, or even more important, your experience will be greatly appreciated.

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By Terry in Phoenix / Oracle, AZ on 7/5/2007


In my experience, both in this industry and others,  vendors that want to charge such fees generally, if not always, tell you up front and often in writing not "Oh, by the way...."

If this contractor did not notify you either up front or in his written bid of such a fee he really does not have much to stand on.  I suppose he might try to take you to small claims court or such, but he certainly has no legal standing for a mechanic's lien against you as he has done no actual service or work.

Check all of the paperwork and correspondence between this contractor and yourself carefully to see if there is mention of such a fee anywhere in any of it prior to or upon submission of his bid.  If there is no such written statement the guy has little legal recourse.


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By Mancong in Seattle, WA on 7/5/2007


Terry,

Thanks for your reply.  We now feel much better.  Our biggest concern is liens.  I still don't quite understand how the lien law works, but from what I've heard it can be messy.

We met this contractor twice and most correspondence was via phone and email.  I checked again - there was no mention of fee anywhere.

We plan to write back to him and tell him that we think he doesn't have legal standing in this case.

I'm glad we didn't chose this contractor.  He bid was lower but with too many holes.  We didn't feel comfortable. 

Thanks again!

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