A custom-built home in Espanola with a finish list nobody could agree on

The situation

By the time Natalia came to our office, she had already sent three emails to her builder with photographs attached, walked the property twice with a checklist, and asked her real estate agent to intervene informally. None of it had produced a finished garage, a completed deck railing, or graded landscaping. The builder's responses ranged from silence to a flat assertion that the house was done and any remaining items were cosmetic extras never included in the contract.

Natalia was buying on her own, a first purchase for her, and not a modest one. She owned and operated a chain of clinics, and the custom-built home she had contracted for in Espanola sat in the roughly $1,200,000 to $2,800,000 range, a substantial project even before the disagreement began. She had worked with the builder for over a year, from design through framing to what was supposed to be a final walkthrough, and had been careful throughout to document everything in writing.

The builder, Attila, ran a much larger operation than Natalia's single custom build suggested. He had crews working several properties in the region at once and a track record of moving fast and disputing holdback claims hard when clients pushed back. Attila's business had, according to public commentary Natalia had come across before hiring him, weathered more than one dispute like this before and generally outlasted the other side simply by being able to absorb legal costs longer. Natalia had known that reputation going in and had chosen him anyway, largely because his work was well regarded and his pricing was competitive for the scope of the build, a trade-off that now looked riskier than it had a year earlier.

A construction holdback exists precisely for situations like this. Under the Construction Act, a portion of the contract price, typically a percentage set by the legislation, is held back by the owner for a defined period after the work is substantially complete, so that if subtrades or suppliers go unpaid and register liens, there is a fund available to cover them and an incentive for the builder to finish properly. Natalia's home inspector, Olha, had produced a written report at the walkthrough listing eleven specific incomplete or deficient items, and Natalia had withheld the corresponding portion of the final payment on the strength of that report. Attila's position was that the report was overcautious and that release of the full holdback was overdue.

What the documents showed

Once we had the full paper trail, the dispute turned out to be less about the physical state of the house than about which document controlled what counted as finished. The original construction contract described the scope of work in general terms, listing categories like 'exterior finishing' and 'grading' without itemizing every element. Attila's position leaned heavily on that generality, arguing that once the structure was weathertight and the major systems were operational, the contract's substantial performance standard had been met and holdback release should follow.

Olha's inspection report told a more specific story. Of the eleven items listed, several were plainly incomplete under any reasonable reading, a deck railing that was not yet installed, an unfinished section of exterior siding, and a driveway that had not received its final grading pass. Others were closer calls: a landscaping allowance the contract mentioned but did not itemize, and interior trim work that Attila's team considered complete to a standard finish and Natalia's inspector considered below what the specifications called for.

What ultimately mattered was a clause in the holdback agreement itself, a separate document signed alongside the main contract, which required any dispute over completion to be resolved by written agreement between the parties rather than by either side's unilateral judgment. That clause was the leverage point. It meant Attila could not simply declare the house finished and demand release of funds, and Natalia could not indefinitely withhold the holdback over items a reasonable reviewer would consider trivial. Both sides were bound to work out, in writing, exactly what counted.

The documents also showed something less favourable to Natalia's position: two of the eleven items on Olha's list had, in fact, been substantially addressed by the time of a later site visit, photographs Attila's team had taken and dated. Being candid with Natalia about that weaker ground early was part of setting realistic expectations for what a negotiated resolution could achieve, rather than letting her go into it expecting all eleven items to be conceded.

There was also a timing question the documents raised that neither side had focused on. The holdback and lien clocks under the Construction Act run from the date a certificate of substantial performance is published, not from whatever day the work is later argued to have reached that state, and Attila's lawyer had begun arguing that the house was substantially complete well before the walkthrough, hoping an earlier, purely factual completion date would shorten how long Natalia could reasonably hold funds back. No certificate had been published before the walkthrough, and Attila could not shorten Natalia's holdback period simply by asserting an earlier date; the clock had not started until publication, and no amount of site evidence about when the work was really finished could move it earlier. Pointing that out, rather than arguing the underlying facts on his terms, closed off the argument before it could gain any traction in the negotiation.

What we did

1. Requested the complete signed contract package from Natalia, including the separate holdback release agreement, because the general construction contract alone did not answer the actual dispute; the holdback clause governed how completion disagreements had to be resolved, and negotiating from the wrong document would have weakened Natalia's position from the outset and cost her leverage she would never get back once an offer was on the table.
2. Reviewed Olha's inspection report line by line against the contract's scope of work, sorting the eleven items into clearly incomplete, disputed but reasonable, and weak, so Natalia understood which items we could push hard on and which were better traded away before any offer went to the other side, rather than discovering the weak ground mid-negotiation and losing credibility on everything else at once.
3. Obtained and reviewed Attila's own site photographs and progress records, since a negotiation built only on our client's evidence would have been weaker and less credible than one that accounted honestly for what the other side could show, and it let us anticipate his lawyer's strongest arguments before they were raised across the table, so Natalia was never blindsided by a photograph she had not already seen.
4. Drafted a written proposal for partial holdback release tied to a specific, itemized list of remaining work, converting the vague standard of substantial performance into a concrete checklist both sides could sign off against, which removed the room for the kind of disagreement that had stalled the file for months already and gave Attila's lawyer something specific to respond to instead of a general grievance.
5. Negotiated directly with Attila's lawyer over several rounds, aware that Attila's business could absorb a prolonged dispute far more easily than Natalia could, and structured our approach to reach a workable resolution efficiently rather than letting the process become a war of attrition we were not positioned to win outright on cost alone, since every extra round of correspondence cost Natalia money the other side barely noticed.
6. Secured a holdback rate schedule tied to defined milestones, so a portion of the funds released immediately against completed items while a smaller remaining portion stayed held until the outstanding deck, siding, and grading work was finished and confirmed, giving Natalia real money back in hand without giving up her remaining leverage over the parts of the job that were genuinely unfinished.
7. Built in a confirmation mechanism requiring Olha to re-inspect and sign off before the final holdback tranche released, so Natalia was not relying on Attila's word alone a second time after the first round of disputes, and so any future disagreement over completion had an independent referee built in from the start rather than leaving the last word to whichever side argued louder.
8. Established that no certificate of substantial performance had been published before the walkthrough, closing off Attila's attempt to argue an earlier, undocumented completion date that would have shortened the period Natalia could reasonably hold funds back under the Construction Act framework, a technical point that mattered more to the final numbers than it first appeared, since the holdback clock runs from publication of the certificate, not from whichever date a builder later prefers.
9. Set a clear timeline for the outstanding work inside the written agreement itself, so that the remaining holdback was not left open indefinitely and both sides had a defined point at which the matter would either resolve or escalate further, which gave Natalia a real end date to plan around instead of an open-ended wait that could have stretched on for another building season.
10. Walked Natalia through the trade-offs in the final proposal before it was signed, being direct about which items she was conceding and why, so her agreement to the compromise was informed rather than simply a relief at reaching any resolution at all, and so she would not look back later feeling she had been rushed into terms she did not fully understand.

The outcome

The result was a negotiated compromise rather than a clean win for either side. Natalia received immediate release of roughly two-thirds of the disputed holdback, tied to the items both sides agreed were genuinely complete, while the remainder stayed held back against a written, itemized list of the deck railing, siding, and grading work still outstanding. The interior trim item, one of the weaker points in Natalia's original claim, was resolved with a modest credit rather than full remediation, reflecting that it fell closer to Attila's standard finish argument than to a clear deficiency.

Attila's side did not get everything either. The full holdback was not released on the general substantial performance argument his lawyer initially pushed, and the confirmation mechanism meant he had to complete the outstanding work to Olha's sign-off standard before seeing the final funds, something his original position had explicitly resisted. His attempt to shift the substantial performance date earlier, which would have shortened Natalia's holdback rights, also did not succeed once the documentation was laid out plainly.

For Natalia, the practical benefit was less about the dollar figure and more about no longer being stuck in an unresolved standoff with a builder who had more resources and less urgency to settle than she did. Every additional month of delay had cost her legal fees and stress with no guarantee of a better result at the end of it, and the negotiated agreement converted that open-ended exposure into a fixed, monitored process with a real end date. The outstanding work was completed within a few months of the written agreement, confirmed by a second inspection, and the final holdback released without further dispute.

It was not the outcome Natalia had hoped for at the outset, when she believed all eleven items were legitimate and expected the full holdback to remain in place until every one was addressed. Conceding the interior trim item, in particular, was a genuine disappointment to her. But it was a resolved file with defined obligations on paper, rather than an open dispute against a well-resourced counterparty with no natural end point, and Natalia said afterward that having a fixed date to work toward mattered more to her than she had expected going in.

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