Progressive Payment And Variation Order

[almonds 1]

Guys - can i seek your opinion on this please.

Based on contract, we're supposed to pay our ID progressively 20-40-30-10 (final 10% after rectifications)

So far we have paid the first 60%. Due to changes in our quotation, our original quote of say, $50k, has dropped to around $47k maybe. Is it reasonable for us to request for a variation order before making the next 30% payment? Because if we were to pay 30% based on original quotation, my supposed remaining 10% hostage will effectively drop from $5k to $2k, which I'm afraid the ID would view as negligible hence take his own sweet time to complete rectifications.

Any advice pls?

Thanks!

[Lauer 15]

Guys - can i seek your opinion on this please.

Based on contract, we're supposed to pay our ID progressively 20-40-30-10 (final 10% after rectifications)

So far we have paid the first 60%. Due to changes in our quotation, our original quote of say, $50k, has dropped to around $47k maybe. Is it reasonable for us to request for a variation order before making the next 30% payment? Because if we were to pay 30% based on original quotation, my supposed remaining 10% hostage will effectively drop from $5k to $2k, which I'm afraid the ID would view as negligible hence take his own sweet time to complete rectifications.

Any advice pls?

Thanks!

The contract allows a retention of 10% until successful handover, so you could retain the $4.7K.

In other words, the next payment should be $(47K - 30K - 4.7K) = $12.3K, where $50K x 60% gives you the $30K.

Cheers!

[almonds 1]

Thanks for your reply Lauer!

Problem is, not sure if the final cost is $47k. Could be more/less, hence wondering if its reasonable to insist the ID on providing a variation order to see final cost before paying the 30%

[Lauer 15]

Thanks for your reply Lauer!

Problem is, not sure if the final cost is $47k. Could be more/less, hence wondering if its reasonable to insist the ID on providing a variation order to see final cost before paying the 30%

Nothing reasonable or unreasonable about asking for the VO details.

Don't think too much.

Cheers!

Edited November 20, 2011 by Lauer