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#209698 - 04/18/13 07:53 PM Lighting package ordering error
wewire2 Offline
Member

Registered: 11/14/02
Posts: 246
Loc: California
Scenario: A job is bid by an EC based on the lighting fixture schedule. The material supplier gets an exact copy of the fixture specifications including count and bids the package to the EC. prior to the bid. It's a package so the individual fixture prices aren't broken out. Upon receipt of the fixture package the EC finds that some of the fixtures are not as specified. The supplier says they made a mistake and will be losing $1000. but agreed to honor the quote. My question is, what do you think is the best way to handle this? Split the loss 50-50, take the loss or let the supplier honor the quote?

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Business, Office, Estimating, Legal:
#209702 - 04/18/13 08:21 PM Re: Lighting package ordering error [Re: wewire2]
Tesla Offline
Member

Registered: 06/16/04
Posts: 1280
Loc: Sacramento, CA
All of my experience has been with firms that would hold the supplier to the quote.

It's what happens when a C-10 blows his estimate. No GC says, awe shucks... here's an extra $22,000... I'm glad to help you pay for your mistake.


Edited by Tesla (04/18/13 08:22 PM)
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#209705 - 04/18/13 10:48 PM Re: Lighting package ordering error [Re: wewire2]
twh Offline
Member

Registered: 03/11/04
Posts: 892
Loc: Regina, Sask.
I agree with Tesla. Those who share in losses must also share in profits. No supplier splits excess profits so no contractor shares in their losses.

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#209712 - 04/19/13 07:30 PM Re: Lighting package ordering error [Re: wewire2]
electure Offline

Member

Registered: 12/24/00
Posts: 4225
Loc: Fullerton, CA USA
Here's a scenario where it pays to have submittals with attached cut sheets for any fixture specified.

The EC checks over the submittals, and sends them to the Architect or PE for approval and signing.

Then and only then is the fixture package released.

The supplier should eat the loss.



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#209713 - 04/19/13 09:44 PM Re: Lighting package ordering error [Re: wewire2]
wewire2 Offline
Member

Registered: 11/14/02
Posts: 246
Loc: California
So let's throw a twist in the scenario. The supplier originally received the correct fixture information but provided the quote to the EC specifying the wrong fixture
model numbers by leaving out the "EL14" designation for emergency fixtures. The EC did not catch the mistake. Should that make the EC part responsible? Now where do you stand on this?

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#209724 - 04/20/13 09:34 PM Re: Lighting package ordering error [Re: wewire2]
Tesla Offline
Member

Registered: 06/16/04
Posts: 1280
Loc: Sacramento, CA
By law the supplier is providing a 'counter-quotation' -- that is -- is renegotiating the transaction into a new deal.

Most PO have clauses for such issues -- things like mandatory arbitration.

If the EC ACCEPTS the counter-proposal -- then it constitutes a new contract, a new deal, and the EC is deemed accepting the substitution.

The issue would then be fodder for the opposing attorneys who, I can assure you, would love to debate the finer points -- on your dime.

Where we stand wouldn't be worth two bits in such a court case. It would turn on particulars that you have not included in your hypothetical.

BTW, the typical PO issued by the firms I've worked for does NOT allow for the supplier to even re-mark the document as to the type of fixture.

It only has lines for $$$$ and signatures and delivery dates.

That's because this type of omission has happened before.

That's a little tip for you budding ECs out there. You craft your own PO -- and the only document that constitutes acceptance is that same form counter-signed with ultimate acceptance turning upon your final authorization.

That way you stay out of court -- particularly bankruptcy court.


Edited by Tesla (04/20/13 09:36 PM)
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#209732 - 04/21/13 08:47 PM Re: Lighting package ordering error [Re: wewire2]
wewire2 Offline
Member

Registered: 11/14/02
Posts: 246
Loc: California
Great points Tesla.

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