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Bad Business: Premier Construction (PCMS), Hamilton, ON

February 28th, 2009

When we started this blog we said we were not going to name the individuals or companies we were working with, so we would have the freedom to be critical without getting into a war with someone over the specific details of any given situation.

While that policy generally stands, we’ve decided to change that policy for any contractor who, say, does thousands of dollars of damages to our and neighbouring properties, then takes off without completing the job but keeping all the money that’s been paid to them.

It’s our opinion that Premier Construction and Maintenance Services Inc. / PCMS (of 107 Gertrude Street in Hamilton, Ontario) is such a company and we don’t think anyone should be doing business with them. We think Premier Construction is a bad company, with bad business policies.

Maybe they have a side to this that we haven’t considered. All I’ve really heard from head office is that they think they did a good job and met the requirements of the contract. (They don’t say they completed the work they promised, only that they aren’t legally obliged to do more than they’ve done.)

I should add that all the employees I dealt with on site were always polite and reasonably easy to get along with, even when we disagreed. My major problem with this company is that I don’t think they completed the work they were legally obliged to complete, and I know they didn’t complete the work we asked to be completed from the beginning.

The history:

The first quote we received from Brad Mackenzie of Premier Construction and Maintenance Services for the demolition and excavation of our house required us to pay $6,500 before work even began (this on a $16,000 contract). We explained that since their industry was fraught with charlatans, we could not pay for anything before the work was completed.

This seemed very reasonable to us (as we explained to them as well) because we obviously have he financial resources to pay them if we’re at the start of a whole construction project, and if we choose not to pay them then the lien system is entirely working in their favour. They know where we keep our biggest asset. We, on the other hand, have very little recourse if they were to just take off with the money.

They agreed, and a contract was struck for the work. The payments would be broken down in stages so we could always see the work that had been completed before paying. One of the nice things about having a contract written out is that it is clear what all parties have agreed to as being ‘fair.’ Or so we thought.

Here is page 1 of the original contract with Premier Construction (page 2 seems to be boilerplate). The relevant  “Scope of work” described on page 1 is as follows:

Stage 1: Set up Safety Fence & secure property. Removal of first floor. (Payment $7,600)

Stage 2: Removal of Basement Floor & Walls to bear <sic> ground. Removal of front walkway & debris. (Payment $6,640)

Satge <sic> 3: Excavate lot & removal of earth as required by other party or contractor. Clean up and removal of safety fencing & equipment from site. (Payment $2,021.85)

The whole project was to take 17 days, “weather permitting” but they said they thought it might go even faster. As mentioned in my previous post they turned out to be generally unreliable in delivering what they said they would. But I should add some more detail here about the “constant renegotiation of the contract” I mentioned.

On January 3, when the house was at still standing Brad Mackenzie showed up at our house (the one we’re renting during construction) without warning and demanded payment: (loose quote) “Head office is telling me I have to get a payment now before we take the roof off. The whole ground floor will be gone in a day or two at most after that anyway, so we need a payment now.”

Think about this: Why on Earth would they need a payment given that the scope of work for Stage 1 is removal of the first floor? Unfortunately we interpreted this action as more “strange” than “shady” behaviour at the time. This excuse of blaming head office was one that Brad would return to repeatedly to demand early payment for one reason or another.

On January 6th, they demanded payment again when the ground floor was ‘down’ and there was a 10′ high pile of debris in the back yard. Their excuse this time was that “removal” doesn’t mean that the debris is actually removed. To them (and only them, I would think) removal just means “not in the same position on the property.” We were told if we didn’t give them a payment at this point (even though the contract couldn’t be clearer) “head office” would pull out of the job. Not wanting to have to try to find a new demolition company on short notice, and as a show of our good faith, we agreed to pay half, and would pay the other half when all the debris had been hauled away.

By January 11th (over a week since they said payment was due) the debris was finally cleared and we paid the second half of the Stage 1 fee.

As you’ll see in the pictures in the gallery, not a lot happened from that point through January 27th (over two weeks). In one picture you can see part of the ground floor is still present at the back of the house. Progress continued to be slow.

The next demand for payment came February 4th. Once again, a lot of debris was still on site. They argued that the contract’s phrase “Removal of front walkway & debris.” meant only the debris from the walkway would be removed. We disagreed and once again settled on paying half the fee they were demanding and asked that the rest of the debris be removed.

Since we were coming up on the excavation phase, there were email exchanges during this time about the depths and outline for the excavation. Brad Mackenzie met with our builder to discuss these details. No issues were raised with the planned excavation. (e.g., issues you might raise if you didn’t actually think you had committed to do the described excavation.)

On February 17th Brad got around to asking for the second half of the Stage 2 fee, there was still a considerable amount of debris on the site, but he argued that they had actually already started on excavation (phase 3 – Excavation) and therefore there was enough ‘value’ in the work that had been done that we should have no problem paying the second half of the fee at this stage.

Brad Mackenzie assured me most solemnly that I had absolutely no worries, that even though the company had run up far more expenses than they had intended on our job they were a company that always saw the job through. I decided to pay them.

This was the wrong thing to do for several reasons. The most important is that I had forgotten the reasons for my position on payment structure: They have very little exposure for non-payment of invoices. We have enormous exposure for over payment of invoices.  I should have simply stated that I was uncomfortable paying more until the debris was removed. That would have been perfectly reasonable.

Not much of anything was done after they got that last payment. And on February 19th, the Ministry of Labour arrived to shut the site down. It seems this company never filed a “Notice of project” with the ministry, as they are required to do (so the ministry can make sure the site is being run properly).

Not surprisingly, it was not being run properly. It seems all those assurances I received to my repeated safety concerns were… ‘inaccurate.’ The flimsy orange fencing they had leaned here and there was not actually sufficient protection for a 6′ deep hole. (When I look back at the photos now, I’m appalled I let the site get as out of control as it was. I should have called in a city inspector when I first had concerns about the safety of the site.)

By *wild* coincidence, shortly after the ministry shut the site down, the company had a meeting and concluded that the job was actually finished. (Something they apparently didn’t know before they went into the meeting.)

Here’s an email from Premier Construction (with original formatting) I received from someone who would only identify themselves as “director” (even after I asked for their name). I encourage you to:

  1. look at the photos of the condition of the site which, to us, looks like it was excavated with all the precision of long range artillery. Square and level? Ready for footings? No.
  2. look at the instructions of the contract indicating excavation was to be to our specification.
  3. look at the letter from “Director”

and let me know which of us has it wrong. The director is right that no excavation dimensions are given — it just says they’ll excavate whatever we require.

As a little parting gift to us, they abandoned the disposal bin in our neighbour’s driveway. When we called to have it removed we found out just how bad a job they had done, and possibly discovered one of the reasons their meeting concluded that the work was ‘complete.’

The bin disposal company informed us that this bin didn’t contain clean fill (disposal cost: ~$300/bin), but soil mixed with construction debris which has to be disposed of as garbage (disposal cost: ~$2500/bin). If you look a the photos, you’ll see that the property is filled with about 4 bin-loads of clean-fill that they had churned with construction debris.

Their sloppy technique of excavating and demolishing at the same time created enormous mounds of garbage debris all over our property out of what should have been clean-fill debris. What could have been disposed of quite affordably was now going to cost a small fortune.

(Good thing the small-claims court limit was increased from $10,000 to $25,000 on January 1!)

Oh, and to explain the “washing machine” photo: one of the demolition guys offered to buy our washer and dryer from us on the first day they showed up. But he never paid for them, didn’t pick them up, but instead buried them in the hole under those mounds of debris they left behind.

I expect we’ll need to ask an independent third party (i.e., a judge) to tell us who is right in this matter. I’d be stunned (once again) if it turned out we were the ones being unreasonable.

Believe it or not: this is the short version of the story.

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