A Vancouver woman says she is being held to ransom, after a renovations firm initially refused to even partly refund her deposit— unless she agreed not to write a negative online review of the company.
Marla Burnham demanded a full refund of her $5,000 deposit after Level One Construction doubled their initial $18,000 estimate for work on home renovations, her shed roof and a new sauna.
The firm said the contract she signed with them contained a cancellation penalty, but later said it would offer her a partial refund of her original deposit - if she promised not to post a negative review on the internet.
Burnham says she's particularly shocked because she chose the company in the first place using the home renovation review website Homestars.com, where the firm has received almost entirely positive reviews, and the Better Business Bureau.
"I did some research, looked for companies that had a good reputation — good online reviews — through some websites that I thought were there for that purpose," she said.
In future, Burnham says, she won't be relying on websites and online rating systems anymore.
"I think that they are quite meaningless now. Because if you don't see any [bad reviews], it might be because everyone who has had a bad experience has signed off and said, 'You know, I want my money back, so I'm not going to say anything bad about this company.'"
$18K estimate almost doubled
Burnham got estimates for the work from two companies, and decided on Level One Construction, after a project manager with the firm quoted her $18,000.
She duly signed a contract for the work and handed over a $5,000 deposit. A short time later, a different project manager from the company came out to see the job.
Burnham went on vacation for a week, thinking it was a straightforward job that would be done quickly, but returned to find a new costing of $35,536.31 — almost double the original estimate.
"So they got me to sign based on one price and changed it, which just seems super-dishonest to me," said Burnham.
At first, the second project manager seemed apologetic, writing in an email to Burnham.
"I have no idea how [the first manager] came up with [his] number," and "You do have the option of…requesting your monies back," said the manager in the email.
But then Level One president Randy Kautzman stepped in, pointing out the contract contained a 15 per cent cancellation penalty, so she should not be receiving any money back.
However, he said, if she promised not to post a negative review on the internet, he'd settle for a less and only keep $1,000 of her deposit.
"It's definitely not my error....My error was having faith in that company, " said Burnham. "Thinking that they were straightforward and up front. And I can't be held responsible for the mistakes they make in their estimates."
Breach of contract questioned
Litigation lawyer Mathew Good says someone in Burnham's position would be due a full refund, because if a contractor dramatically changes the price, he's breached the contract.
"Look you've got a problem here, You've agreed to do it, you've promised to do it for a certain price, so legally you could be held to that," said Good.
When first contacted by CBC News, Kautzman said he'd reconsidered and would give Burnham a full refund. But after talking to his lawyer, he'd changed his mind.
Burnham will be fighting him and has filed a statement of claim in small claims court.
"It would be one thing if they had gone on the job and found there was a pipe going through the property that had to be removed or something, but no one so much as lifted a hammer in this situation."
Two days ago, Kautzman filed his own statement of defence in response, agreeing to refund $2750 of the deposit, but claims that Burnham changed the scope of work before cancelling, and therefore the company is entitled to keep the rest.
On Thursday Kautzman sent a statement to CBC News saying:
"Level One Construction entered into a signed contract which included a provision for costs associated with cancellation. She is being charged the cancellation fee.
"When we enter into our contracts we have to go through the process of putting together the bids and confirm estimates, commit our workers to schedules which precludes us from other jobs.
"Ms. Burnham cancelled the job and then was subject to the cancellation fee."
None of the allegations have been proven in court.
- Contract signed between Marla Burnham and Level One Construction
- Marla Burnham's statement of claim with the small claims court
- Randy Kautzman's statement of defence