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Posted: 3/1/2006 3:19:52 AM EDT
I recently signed a contract with a home builder to purchase a newly completed home. The home has a 1000 gallon propane tank buried in the yard that supplies propane to heat the house. The closing is scheduled for this Friday. Yesterday the builder calls and tells me he'll expect me to pay him at closing for whatever propane is in the tank. He said he put 500 gallons in the tank a month ago and hardly any has been used since no one is living in the house. So he requested I just pay the bill for the 500 gallons. The contract doesn't say anything about me paying for whatever propane is in the tank, so I think it's not my responsibility to pay him for the propane. However, the builder has been a pretty good guy to deal with and I'll need to keep the relationship in good standing since he'll be warrantying the house. I'm thinking I'll just offer to split the bill with him. What do you guys think?
Link Posted: 3/1/2006 3:23:11 AM EDT
Unless it was in the contract, he is out of luck.

Dont pay it. Besides, you dont really know if there are 500 gallons in the tank. If you wanted to be totally fair, get the tank filled the day you take posession and pay him the difference from full tank.

Dez
Link Posted: 3/1/2006 3:23:32 AM EDT
I don't see the problem? You'll have to buy propane anyway.
Link Posted: 3/1/2006 3:24:57 AM EDT
Just say, "Where does it say that in the contract, I must have missed it...." and take it from there.
Link Posted: 3/1/2006 3:25:59 AM EDT
I call. You are actually ready to close on a house you had built and you still like your builder? That's a good story.

Seriously though, if you are still happy with the builder at this point I would think twice before doing something that would ruin that relationship as you will need to call on him during the next year. Tell him you will split the cost or something like that. Try to keep both of you happy.
Link Posted: 3/1/2006 3:26:02 AM EDT
[Last Edit: 3/1/2006 3:27:03 AM EDT by mikejohnson]
a last minute concession....what concession will he give you in return? I would threaten to walk away...this kind of negotiation when the deal is supposed to be closed is one reason to (threaten) to walk away from the deal. How much is 500 gallons of propane worth to him? He is risking a huge deal over this? He should have mentioned it first, and if he realized the mistake he should have pointed it out ASAP. I study negotiation tactics and I personally would threaten to walk, but I also know that a fair outcome for both parties is is alright. So if it were truly an honest mistake and not a dirty trick, then I would work a deal somehow. My guess is this experienced builder is using dirty tactics...oh and don't be surprised if he comes to get the propane (it is not in your contract, either way, right?)
Link Posted: 3/1/2006 3:28:27 AM EDT

Originally Posted By Johninaustin:
I don't see the problem? You'll have to buy propane anyway.




Because the contract says I am purchasing "the property with all improvements". "All improvements" includes the propane tank and it's contents.
Link Posted: 3/1/2006 3:31:52 AM EDT

Originally Posted By mikejohnson:
a last minute concession....what concession will he give you in return? I would threaten to walk away...this kind of negotiation when the deal is supposed to be closed is one reason to (threaten) to walk away from the deal. How much is 500 gallons of propane worth to him? He is risking a huge deal over this? He should have mentioned it first, and if he realized the mistake he should have pointed it out ASAP. I study negotiation tactics and I personally would threaten to walk, but I also know that a fair outcome for both parties is is alright. So if it were truly an honest mistake and not a dirty trick, then I would work a deal somehow. My guess is this experienced builder is using dirty tactics...oh and don't be surprised if he comes to get the propane (it is not in your contract, either way, right?)



Technically he owns the house until closing and he could remove the propane from the tank prior to closing. It doesn't say in the contract that he must deliver the house to me at closing with propane in the tank.
Link Posted: 3/1/2006 3:32:58 AM EDT
[Last Edit: 3/1/2006 3:33:41 AM EDT by mikejohnson]
oh, and is it verifiable how many gallons are in there or are you taking this "experienced hombuilder's" word for it?
Link Posted: 3/1/2006 3:33:00 AM EDT
I'd ask why it was only half full! You don't buy a new car with a 1/2 tank of gas! Sheeeeit.
But then again, I'm a bit of an ass.
Link Posted: 3/1/2006 3:39:20 AM EDT

Originally Posted By Johninaustin:
I don't see the problem? You'll have to buy propane anyway.



it is typically a dirty tactic - the home builder will probably profit from the propane and he probably knew this going into the deal.....he waited until a critical point to bring it into the deal...
Link Posted: 3/1/2006 3:39:49 AM EDT
Here in the northeast we mostly use fuel oil but the standard practise at a closeing is for the buyer to pay for the feul on site,usually with the seller filling the tank and charging the buyer for a full tank. Sometimes the buyer fills the tank and the seller gets paid for the difference. Every now and then the argument comes up about the local pervailing price but generally the buyer always somehow pays for the value of the fuel.
Check with your attorney doing the closeing,they should have a list that shows all sorts of fees and charges and which party is responsible for what.
Link Posted: 3/1/2006 3:41:19 AM EDT

Originally Posted By SWIRE:
I call. You are actually ready to close on a house you had built and you still like your builder? That's a good story.

+1 to that, you've been missing a lot of stuff if you arent absolutely pissed at the builder by now.

Kharn
Link Posted: 3/1/2006 3:43:38 AM EDT
I really don't see the problem. I highly doubt consumables (water/electricity/propane/leftover beer in the fridge.) counts as an improvement. You can either buy the propane now, (subject to amount verification) Or he suctions the tank, keeps it, and you buy more tomorrow with the builder now pissed at you.

BTW: I got along FINE with our builder. Great guy. We've been in the house 7 months and he stops by roughly twice a month to check up on things. Then again, my house is all electric.
Link Posted: 3/1/2006 3:45:15 AM EDT

Originally Posted By nhsport:
Here in the northeast we mostly use fuel oil but the standard practise at a closeing is for the buyer to pay for the feul on site,usually with the seller filling the tank and charging the buyer for a full tank. Sometimes the buyer fills the tank and the seller gets paid for the difference. Every now and then the argument comes up about the local pervailing price but generally the buyer always somehow pays for the value of the fuel.
Check with your attorney doing the closeing,they should have a list that shows all sorts of fees and charges and which party is responsible for what.




yeah - only deal if the tank is FULL this way you know how much is there (of course, this is only if you intend to buy the propane from him afterall)
Link Posted: 3/1/2006 3:48:23 AM EDT
[Last Edit: 3/1/2006 3:48:51 AM EDT by spartacus2002]
tell him to fill the tank and that you'll pay for a FULL tank. Then smile and tell him you don't want any more surprises.
Link Posted: 3/1/2006 3:48:36 AM EDT
Why was any propane put in the tank in the first place?
Link Posted: 3/1/2006 3:49:05 AM EDT
Link Posted: 3/1/2006 3:50:46 AM EDT

Originally Posted By Johninaustin:
I really don't see the problem. I highly doubt consumables (water/electricity/propane/leftover beer in the fridge.) counts as an improvement. You can either buy the propane now, (subject to amount verification) Or he suctions the tank, keeps it, and you buy more tomorrow with the builder now pissed at you.

BTW: I got along FINE with our builder. Great guy. We've been in the house 7 months and he stops by roughly twice a month to check up on things. Then again, my house is all electric.




I agree that keeping the relationship strong is important. After consideration, I also agree that the best plan of action is to have the amount of propane in the tank verified and pay that amount.
Link Posted: 3/1/2006 3:52:01 AM EDT

Originally Posted By jjrockbush:
Why was any propane put in the tank in the first place?




He was showing the house and using it as a model.
Link Posted: 3/1/2006 3:56:31 AM EDT
If he is asking for normal market price for the propane, I'd call it a good deal in that you didn't have to mess with it. Kind of a convenience. If you don't trust him, have it filled and pay him the difference as mentioned before.
Link Posted: 3/1/2006 3:56:50 AM EDT

Originally Posted By TacticalStrat:


He was showing the house and using it as a model.



so if its not an add on item, he knew it was there and it should have been included in the negotiated purcahse price. perhaps he forgot and is now trying to recover some extra cash.
Link Posted: 3/1/2006 3:56:53 AM EDT
First of all...you should have a guage on the tank showing it's fuel level so the amount remaining should be reasonably verifiable. Second, if you don't want to deal with the propane supplier (not the builder)...tell the builder that you'd rather work out your own deal with a supplier and to take back the propane..he'll only get AT BEST less than half of what he paid for it so if you'd like to negotiate with him, you can use that as a bargaining point.

Personally when we bought our house the seller refused to throw in the propane left in the tank and wanted us to pay him full price for it. We offered to pay half and he refused. We didn't want to deal with the supplier anyway so we told him to have it drained...in talking to the supplier the seller got about 1/3 of what he paid for the gas.

FWIW I agree with others that if you aren't pissed at your builder by now, you've either missed some HUGE items in the construction (are there any joists under the floor ) or you have a novice builder.
Link Posted: 3/1/2006 3:58:00 AM EDT
[Last Edit: 3/1/2006 4:01:36 AM EDT by TacticalStrat]

Originally Posted By Kharn:

Originally Posted By SWIRE:
I call. You are actually ready to close on a house you had built and you still like your builder? That's a good story.

+1 to that, you've been missing a lot of stuff if you arent absolutely pissed at the builder by now.

Kharn




Actually, the builder has really been great and builds a real quality house. Here's a few pics of the kitchen.






Link Posted: 3/1/2006 3:58:28 AM EDT
[Last Edit: 3/1/2006 4:06:39 AM EDT by TRW]
I know it is common up here to include heating oil in the contracts but that being said if it's not in the contract I think technically he is SOL.

I would reimburse him after having the tank filled and deducting the difference in the before and after amounts and after he produced a receipt that didn't look bogus and listed the per gallon price he paid.

ETA: Awesome kitchen! I would have gone with a lighter finish on the cabinets but that's just personal taste. How about more details on the house, i.e. sq ft, bedrooms, baths, etc. Also if you don't mind me asking how much the house costs (ballpark).

Just interested as I may custom build when I get back to Utah.
Link Posted: 3/1/2006 3:58:43 AM EDT
If he was using the house as a show home it is his cost! I would offer to buy his propane from him at cost or reduced price to save him from having to take HIS propane. He should be giving you that propane for free or reduced cost. Remember its HIS propane. I would also get at least 3 quotes for 1000 gallons of propane to make sure your not getting screwed. I would also have him fill it all the way up.
Link Posted: 3/1/2006 4:02:10 AM EDT
dayum!

Im bringing my sleeping bag
Link Posted: 3/1/2006 4:06:02 AM EDT

Originally Posted By mdezdez:
Unless it was in the contract, he is out of luck.
If you wanted to be totally fair, get the tank filled the day you take posession and pay him the difference from full tank.

Dez



+1

Best idea by far
Link Posted: 3/1/2006 4:07:11 AM EDT
Link Posted: 3/1/2006 4:07:37 AM EDT
When we bought our house, the propane in the tank came with it. We bought it from the builder who was living in it though.

You could go either way, offering to split it is probably the nicest thing to do. He may have paid less for the stuff than you can now get it for though. So you may check the price.

They don't often fill a tank here FULL because of expansion and the temperature outside. THey will say, put 400 in a 500 gal tank for us. they have a minimum of 200 gallons. It sucks to run out though, we ran out on Christmas Eve this year because we didn't pay attention to it.

However, you would have to pay for heat if it were electric or natural gas by the gal if you had a line to your house so you could look at it that way if you feel bad about paying the builder.

Link Posted: 3/1/2006 4:11:38 AM EDT
Are you positive it isn't in the contract? It is very unusual not to reimburse the seller for fuel that you will be getting on transfer of title. What does your attorney say about it? Remember that in a new house you WILL have issues after the closing - screwing the builder is not going to help in getting him back to fix little issues. Fill the tank and pay him for the difference - it is the right thing to do.
Link Posted: 3/1/2006 4:22:15 AM EDT
fill it- Id be willing to bet ther is NOT 500 gallon in it.
Link Posted: 3/1/2006 4:26:48 AM EDT
You dont change horses on me half way through the race.
Link Posted: 3/1/2006 4:27:20 AM EDT
Nice house! Might I ask what you do for a living? Are they hiring? :)
Link Posted: 3/1/2006 4:27:26 AM EDT

Originally Posted By Bushman_269:
Are you positive it isn't in the contract? It is very unusual not to reimburse the seller for fuel that you will be getting on transfer of title. What does your attorney say about it? Remember that in a new house you WILL have issues after the closing - screwing the builder is not going to help in getting him back to fix little issues. Fill the tank and pay him for the difference - it is the right thing to do.




It simply says "the home located at [address] with all improvements". It then has a list of exceptions, which has a few items that I had inserted into the contract that the builder must take care of prior to closing. There is no mention of fuel or propane anywhere in the contract.

I agree that paying the builder for the measured propane is the wise and right thing to do, even though there is no mention of it in the contract.
Link Posted: 3/1/2006 4:28:32 AM EDT
If you like your builder still, then have the integrity to work out a fair deal. I would recommend getting the tank filled and paying for a full tank.
Link Posted: 3/1/2006 4:29:29 AM EDT
pay the going rate ,since you will be having it filled anyway.
Link Posted: 3/1/2006 4:36:16 AM EDT

Originally Posted By rcoers:
Nice house! Might I ask what you do for a living? Are they hiring? :)




Thank you. We are very excited about the house and can't wait to move in.

I work in marketing/PR for a high-tech company.
Link Posted: 3/1/2006 4:44:02 AM EDT

Originally Posted By spartacus2002:
tell him to fill the tank and that you'll pay for a FULL tank. Then smile and tell him you don't want any more surprises.



big plus one


Fill the tank, and tell him you'll pay todays going rate for a full tank of propane. IT's something you're going to have to do anyway and will remove the headache.

Link Posted: 3/1/2006 4:52:28 AM EDT
Just tell him you don't want it and to take it back. I bet the look on his face would be priceless.
Link Posted: 3/1/2006 9:43:47 AM EDT
Beautiful house! Any chance you can get me a job with Dell?

I suspect they needed fuel in the tank to test the systems in the house and to keep the pipes from freezing if there was cold weather. I'd pay him the market value for whatever propane is in the tank.

GunLvr
Link Posted: 3/1/2006 9:56:04 AM EDT
[Last Edit: 3/1/2006 9:58:12 AM EDT by AcidGambit]

Originally Posted By Kharn:

Originally Posted By SWIRE:
I call. You are actually ready to close on a house you had built and you still like your builder? That's a good story.

+1 to that, you've been missing a lot of stuff if you arent absolutely pissed at the builder by now.

Kharn



I won't even post the things I would like to do to the people who built my house because it would probably get me banned for life.

Before paying for the propane I would like to know why it was only half filled (who half fills things ?) and how much does he want in relation to the current price of propane in the area.

I'd be tempted to tell him to get fucked...You agreed on a price and signed a contract.

ETA: That's a nice friggin house.
Link Posted: 3/1/2006 10:02:15 AM EDT

Originally Posted By AcidGambit:

Before paying for the propane I would like to know why it was only half filled (who half fills things ?) and how much does he want in relation to the current price of propane in the area.




People partially fill large fuel tanks all the time. I currently have 200 gallons of non-useful propane sitting in the ground, because I don't have a use for it yet. At my old place we would heat in the winter with propane and wood. I usually only kept the thing about 1/2 full. 1/4 tank would last me most of the year, so why pay 2 years ahead if you already have 2 years in stock? The tank was a 1000 gal.
Link Posted: 3/1/2006 10:09:47 AM EDT
A very nice home , and like a few people said I would fill the tank and pay the differance.
Or you could take it too the next level and tell him it's not in the contract.
your choice
Link Posted: 3/1/2006 10:10:37 AM EDT
[Last Edit: 3/1/2006 10:12:28 AM EDT by OKLAHOMA_LAWMAN]

Originally Posted By TacticalStrat:

Originally Posted By Kharn:

Originally Posted By SWIRE:
I call. You are actually ready to close on a house you had built and you still like your builder? That's a good story.

+1 to that, you've been missing a lot of stuff if you arent absolutely pissed at the builder by now.

Kharn




Actually, the builder has really been great and builds a real quality house. Here's a few pics of the kitchen.











Nice house.
Link Posted: 3/1/2006 10:22:04 AM EDT
How about this --

Have the propane service come fill the tank the day of the closing. Then, calculate the amount in the tank from the builder (tank capacity - what was delivered). You can then pay him all or part of this amount.
Link Posted: 3/1/2006 10:23:48 AM EDT
The propane tank itself is a fixture and is considered real property. The content of the tank is easily removable and not attributable to the land so it is considered personal property. Your contract will likely have any personal property itemized. My guess is, that the propane isnt on there, so it is the builder's personal property. The builder cant not make you purchase it. Make a deal with him for the price you are willing to pay since you will need to fill it anyway.
Link Posted: 3/1/2006 10:33:15 AM EDT

Originally Posted By TacticalStrat:

Originally Posted By Kharn:

Originally Posted By SWIRE:
I call. You are actually ready to close on a house you had built and you still like your builder? That's a good story.

+1 to that, you've been missing a lot of stuff if you arent absolutely pissed at the builder by now.

Kharn




Actually, the builder has really been great and builds a real quality house. Here's a few pics of the kitchen.


members.roadfly.com/agent7/house3.jpg

members.roadfly.com/agent7/house4.jpg

members.roadfly.com/agent7/house5.jpg



so when can I come over
Link Posted: 3/1/2006 10:36:32 AM EDT

Originally Posted By jchewie:
If you like your builder still, then have the integrity to work out a fair deal. I would recommend getting the tank filled and paying for a full tank.

Integrity? How is this an integrity issue?

The builder is trying to stick him with the cost of propane that he did not agree to buy.

If you ordered a specific car from a dealer and they got one with a bunch of extra shit that you don't want, would you pay for it?

There is no integrity issue here.

If you need or want the propane, pay fair market value for it and move on. If not, tell him to take it with him.
Link Posted: 3/1/2006 10:41:04 AM EDT
If this was Ayn Rand's house, she would blow up the tank and burn down the house a la the "Fountainhead."

Do you like to look at your new house naked and laugh? Nevermind.
Link Posted: 3/1/2006 10:42:29 AM EDT

Originally Posted By Johninaustin:
I don't see the problem? You'll have to buy propane anyway.



+1 Otherwise it's HIS and he can come use it.
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