Eugene’s List Blog

According to the City of Tucson Development Services website:

It is the homeowner/propertyowner’s responsibility to provide plans and obtain a permit

* All new residential buildings
* Electrical reconnections, service increases, panel replacement or repair
* Gas lines pressure tests (new or replacement lines)
* Water heater install or replacement
* Furnaces, Heat Pumps, Air Conditioners, Evaporative Coolers (new or replacement)
* All residential walls or fences over 30 inches high must have a site plan review at DSD. Additionally, walls and fences over 6 feet tall require a building permit with an engineering design.
* One Story detached accessory structure over 120 square feet (ie: Storage Sheds).
* Porches, additions or garages
* Remodeling of existing structure

Now obviously many homeowners do not bother with obtaining permits for the smaller home improvement projects listed above because they either are unaware that a permit is required or do not want to pay the extra cost and go through the extra bother.

Here are some guidelines on deciding whether to obtain a permit or not:

• When adding square footage to your house, always obtain a permit. This includes garage conversions and covered porch conversions. The reason is simple, when selling a house only the additions that have been permitted count as part of the house square footage. Obviously, this will have a big impact on the sale price and the saleability of the house.
• Obtain a permit when you need an independent expert to verify the quality of the work. Once a permit has been issued, a city inspector will come to the construction site several times to verify that the construction is according to code. Many city inspectors are former construction workers and foremen with good expertise on the proper construction methods.
• If a contractor is trying to talk you out of a permit, be suspicious and get a second opinion or estimate.

Having said this, there are also disadvantages to obtaining a permit. These include extra permit costs, extra time cost to draw up plans, and usually the contractor will quote a higher price if you decide to go ahead with the permit.

The contents of this blog post are not, nor are intended to be legal advise. You should consult an attorney for individual advice regarding your own situation.

Here’s a recent experience from a Tucson, Arizona homeowner. The homeowner added a new 600 sq. ft. kitchen to his property through a general contractor. During the project a subcontractor poured the concrete foundation for the addition and failed to pay the cement company for the concrete and the cement truck delivery. The cement company then filed a preliminary 20 day lien notice on the homeowner’s property. The concrete subcontractor eventually paid the cement company and the lien notice expired with no further action. The event ended well for the homeowner.

Had a few more things gone wrong, the story may not have had a happy ending. This includes the subcontractor not paying the cement company or a financial dispute between the contractor and the homeowner. If Mechanics lien is recorded in Arizona, the owner cannot sell the property, banks will not lend against the property, and the lien holder may pursue legal action to foreclose on the property.

So could the cement company filed for foreclosure on the homeowners property because a subcontractor did not pay? Most likely not. Arizona law has protection for the homeowner in this case. But in a worst case scenario, the homeowner would have a lot of inconvenience and perhaps additional legal fees as a result. A good article on the subject is on the Lynch Law Firm website. So when faced with a home improvement project that uses a contractor, the homeowner has some remedies at his/her disposal to minimize lien risk, especially in this down economy.

• For a major remodeling project, consult with a lawyer. Having a lawyer on your side will minimize risk and put the contractor on notice not to try any “funny stuff”.
• Have a schedule of payment for work milestones. Pay on time. After each payment is released have the contractor sign a conditional waiver and release for the work done to date. To find the form, do a web search for “Arizona conditional waiver and release”.
• After the project is completed and the final payment is made, have the contractor sign and unconditional waiver and release. To find the form, do a web search for “Arizona unconditional waiver and release”.
• Check the contractors credit. If the contractor is behind in his payments to subcontractors, this could meant trouble for you.
• In the story above, the cement company would not be able to obtain a mechanics lien against the owners property because of the “Owner Occupied Dwelling” protection of Arizona law. According to Arizona law: “subcontractors or material suppliers who enter a contract with another contractor, but not the homeowner, cannot place a Mechanic’s Lien upon this property.” (referenced from the Lynch Law Firm) This however did not stop the cement company from filing a 20 day notice causing anguish for the homeowner and several hours worth of extra phone calls.

Being prepared and knowing your leagal rights and remedies can go a long way towards reducing your risk of lien filing during a remodeling project in Arizona.

The story goes like this:

You have a home improvement project. The contractor comes over, impresses you with his skill and experience, and you give him the job. Now here’s the catch, many times this will be the last time you will see the contractor. What frequently happens next is that an 18 year old comes over, maybe a few months out of high school and does the work. The contractor sends you a bill or comes to collect and thats it.

The 18 year old may be perfectly competent and may have done a good job, and then again, maybe not. So, what can you do to protect yourself? There are several things you can do:

• When agreeing on a project with a contractor, ask point blank who’s going to do the work. If its an employee, make sure there is a thorough inspection included by a foreman or the business owner. The contractor may say something like “He’s a real good guy, I trust his work”. Don’t fall for it, insist on an inspection.
• Never pay 100% upfront. For smaller projects pay 50% upfront and 50% at the end when everything is done to your satisfaction. For larger projects break up payments so that they coincide with milestones. Again don’t release the last payment until an inspection by a foreman or the business owner.
• Get a permit and have a city inspector inspect the work. This will cost more and take more time and the contractor may resist it, but if you do not feel comfortable with your judgement of the quality of the work, this is the best way to go.

By insisting on a quality job up-front, you increase your chances of a successful project.

Payment issues with contractors rank near the top of homeowner contractor disputes. Homeowners have to trust the contractor enough to sign large checks, and contractors need the money to pay the workers and buy materials. Following a few simple rules will help reduce the friction and increase the chances of a successful project:

• Agree on a payment schedule ahead of time. In the contract or quote, or agreement, specify a payment schedule. The homeowner and the contractor should both sign off. Definitely have the payment schedule in writing.
• Pay on time after each milestone. Even if the contractor does not remind you, pay when each milestone is completed. This will add trust to the relationship.
• Never pay in full before the project starts. Horror stories abound about crooks posing as contractors and walking off with the payment. If the contractor insists on full payment up-front, its better to walk away.
• Space out payments according to milestones. For a large projects it may be passing certain inspections. For smaller project it may be in thirds or half up front and half upon completion. As a rule, the bigger the project is, the more payment milestones.
• Always document your payments and ask for detailed receipts. In case of a dispute down the road, documentation is on your side.
• Insist on pricing for change orders ahead of time. Some contractors make most of their profit in change orders. During a project, they may ask if you want this upgrade or this extra work without clearly specifying the price. You may think its free or inexpensive and then stuck with a large bill after the work is done. Make it clear to the contractor (3 times!), that any extras outside of the contract must be agreed upon if the contractor wants to get paid. Have it in writing.