Negotiation competition - session 1 (questions to ask (what happened with…
Negotiation competition - session 1
questions to ask
what happened with the subcontractor, details on the invoices
what are the updates on resolving disputes with subcontractors individually?
how to avoid this happening in the future?
what happened to the framing of one of the back corner walls of the hotel - Bill Patterson detected - how Willco plans to correct it?
what is the overalll updates on the 2 hotels? last time checked, 40% completed
for future performance
construction surety bond - performance bonds, which is 1% or 3% of the project value , that the work will be done in one year
Willco to issue a General contractor's waiver on lien at each time of payment, we also suggest Willco to do so with its subcontractors.
and require its sub-contractors to issue performance bonds
guarantee that no future liens will be filed against the properties due to the fault of Willco, if there is any liens filed, Willco shall escrow the amount and make sure the title transfer/refinancing will not be a problem.
penalties if subcontractor failed delivery the hotels 0.1% of the total value per day.
Willco shall submit monthly accounting report
for the current situation
for the damages to Brownville property
Willco to explain what happened
Willco fix the problem before the completion of 50% work
for the liens
Willco agreeds to postpone the second payment till the liens are resolved. Because 1) Patternsons do not have other cash flow, the money came from the bank; 2) it is bank's policy that they will not lend any more funds untill the liens are resolved.
shifting the 2 liens on Spring property to Brownville, so the 2 M USD can be paid on time to it, and the work can continue.
Willco to file a quite tile action agains 4 liens (2 for dirt work, 2 for gravel work), because Patterson cannot afford the reputation damages, since it is hotel business, and cares more about its public image.
Willco then have an escrow for 97,260 USD (total amount of 3 liens except) - if Willco can not afford all, the both party share the cost
if Willco can not afford at all, then Pattersons will pay first, but expense will be compensated by Willco, , Willco need to compesente, or Pattersons is entitled to deduct from the payment due.
one thing to let the other party know is that : the money is reserved only for additional expense, but need to be proved with sufficient materials for our internal auditing purpose.
Willco to resolve the disputes and remove the lien before the completion of 50% work
some general solutions
if Willco has problems with money
use future vouchers, or future discount on service
the liens will be resolved before the completion of 50% work
Gurantee that Willco can complete both hotels by the one-year deadline
gurantee in any contractual form that there will be no more liens filled agains the property
perceive the relationship
the damages to Brownville to be fixed
achieve all the above goals with as less cost as possible
100,000 USD for additional
2 months extension for 1-year deadline
4 weeks grace period, then compensation for breach of contract