We ended up having to bring a lawsuit to Ian Paine Construction. I think it speaks volumes that we won the lawsuit in our favour with the Judge ordering a settlement payout.
The reason why we had to sue IPC is because they tried holding back our deposit monies from a build contract we cancelled with them. They tried invoicing us for services and fees which were outside of the contract and even before the contract was signed/dated.
Krista, Ian's daughter, now runs the company even though she is not an officer or director of IPC. Although Ian himself may have 40 years of experience building homes, Krista does not. IPC has a very unconventional billing/fee structure. You pay 10% cost plus on all labour and materials but you also have to pay hourly labour fees in addition to the 10%. There is a conflict of interest here because the more they charge hourly, the more they make. In our case, these extra labour fees added up to $80k which really meant we were paying 18-20% cost plus, instead of 10%. Also, IPC had ample time and was fully involved in the bank draw process to give us notice that the design was impossible to build at the agreed budget estimate given by IPC and agreed to in the contract.
IPC is very different than the industry norm because with other builders, the construction manager is also the foreman, which means there are no hourly staff fees. With IPC you have to pay for IPC staff, including the foreman, assistant, project coordinator and any meetings you have throughout the build process plus 10% on top of all these charges. I would not recommend this type of fee structure as you have no control over the accumulation of these hourly fees. Be wary, vigilant and do your due diligence when choosing a builder. Get actual quotes from all trades and suppliers and not just estimates, because IPC’s estimates were off by 2-5 times.
IPC is an award winning builder because they design beautiful homes. But they do not know how to budget or estimate a project effectively without going into massive cost over runs, in our experience. Make sure your build contract is iron clad to protect you and be careful of any mention of hourly fees with your builder.
Moving forward I hope IPC can take this experience seriously and change for the better so other clients do not end up so disappointed and disheartened with the whole building process. Going to court was very stressful for both parties and was completely unnecessary if IPC had resolved the issue privately by being true to the contract.
Fortunately, the Judge sided with us and we got our money back!