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January 31, 2000

Apparently my colleagues and coworkers use their weekends to polish up their problems, to make them presentable enough to dump in my lap on Monday morning. I know this has to be true because it happens every single week.

I really do like my job, but I hate the business. The construction industry has to be one of the most cutthroat enterprises there is. I don't believe that everyone is out for whatever he can get at someone else's expense. Just the people who deal with us. And I think I know the reason for that.

There are two main ways to get work. One is by networking, using contacts, finding investors to back your project or getting hired to build theirs. This is rewarding for the good guys, because the right people trust them. And sometimes it works for the bad guys, because they're willing to do whatever it takes to make it succeed. Whatever it takes.

The other way to get work is through open bidding. This is how we get most of our new jobs. It's an arduous process involving estimating, guesswork, timing and luck.

The bidding process guarantees that price alone determines who gets a job. Ethics and trust and a history of working together have no place in the deal. So the incentive is to bid at the lowest possible price, then start trying to cut corners. While you're trying to pay less, you're also trying to make someone else pay more. If a mistake is made, it's never your fault. And you're always looking over your shoulder, because someone is trying to get away with something. They want what's yours. They also want what's not yours, but so do you.

Half of my day today was taken up by a guy who's trying to screw us. At least, that's the Boss's interpretation. This other company, let's call them Deadbeat Construction, professes the opposite point of view. On this particular project, they are the prime contractor and we are a subcontractor, so we're at their mercy. They're the ones who collect the money from the Owner, and then they pay us. Except when they don't.

What the Boss is worried about is not getting paid for work we've already done. Deadbeat claims we're responsible if the Owner assesses damages because the job is late. The Boss tells me (and I get paid to believe him) that we are not responsible. We delivered our part of the work on time, and not only did Deadbeat not get their own work done, but they were not aggressive in pursuing the Owner for legitimate time extensions. This means that damages are likely to be levied, and the argument is over who should pay.

I honestly don't know who's right in this dispute. The Boss can be very convincing, and very charming when he tries. On the other hand, his thinking is often convoluted, to the point where he builds his case out of straw, then dares the wolf to blow it down. Whoever blinks first is the bigger loser, but no one wins when the atmosphere is sullied with distrust.

Even if it's all about money, the long range costs can be higher than the short term gain. If your reputation is that of a cheap-shot artist, more and more legitimate operators are going to steer clear of working with you, and you find that the only jobs you can get are with other people just as paranoid and disingenuous as you are.

There are legal remedies in California for a contractor who isn't being paid, but they all have their own costs. If we file a Stop Notice, the money is tied up until an agreement is made or a judge decides how it should be disbursed. This could take months. In this business, where you pay for labor and materials long before you can collect on a contract, waiting that long to get paid could be devastating. The alternative is filing an action against Deadbeat's payment bond, which pits us against his bonding company and their array of attorneys. It also brings in the state insurance department, along with the contractors' licensing board.

The terms are confusing to a layman. A notice is filed, action is taken on a notice, an affidavit is sworn, followed by a counter-affidavit. There are Notices to Proceed, Notices of Completion, Notices of Acceptance. There are different rules for public works projects (which this one is) and private jobs. You have to know when to serve a notice, whom to serve it to, where to serve it and how to serve it. There are 30-day periods and 90-day periods during which certain actions have to be taken. Some run consecutively, some concurrently.

Here's a revelation from an unrepentant idealist: None of this would be necessary if people acted in good faith. And good faith would be more likely if people had to look each other in the eye when making a commitment. I've worked with people who'd never think of going back on their word, even if nothing more than a handshake was involved. That kind of person seems to be dying out, facing extinction at the hands of predators like Deadbeat and the Boss.

I spent most of the afternoon on the phone with the Boss, reading over pages of construction law with him and hashing out our alternatives. He wants to proceed without an attorney, and I'm not sure that's going to be either possible or effective. I find myself looking for arguments that will convince him to hold off, see if maybe things will go our way, and wait to take these actions until it's certain that they're necessary. We don't have to give up any rights or miss any deadlines, but we do have to be willing to show some patience.

He thinks I'm just trying to get out of filling out forms and going to court. And you know what? He's right.

Now before you lose all respect for me, I should say that we do excellent work and have very few problems on most of our jobs. And it's only when the Boss is boxed into a corner that his unpleasant side comes out. Moreover, when put to the test, it usually turns out that he's right. We've won in arbitration and in small claims court. It's just that my idea of a successful contractor is one who does the job, collects the money, and doesn't end up in protracted disputes once or twice a year. The constant state of crisis can be very draining.

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