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Worrying Letter

You are entitled to a free half hour consultation with any solicitor so no real harm in asking his advice ( you don't have to take it even if he says he will send a letter for £200). Ask if it's free before you consult him.
 
Years ago I worked with estimators for a medium sized civil engineering firm. It was a thankless job in my view: on average 5/6 of your work went for naught and the 1 in 6 jobs you did win resulted in the inquisition from the site staff over why you'd left x, y and z out!!

You've had a builder price work in competition with others: they can't all win! Builders know that before they start pricing: it's part of the cost of doing business. A sensible client looks past the bottom line figure in picking the winner and the builder's attitude should be high on the list of criteria (I do always say to my clients, however, that if they don't think they could work with the guy after their first meeting then they shouldn't seek a quote).

Your man has lost out on cost and attitude and now he's trying it on. If you've given us a full and true picture (don't take offence: many times we get half the story at best!) then he has no chance if he takes you to the small claims court. Don't worry about it.
 
Basic contact law

Invitation
Offer
Acceptance

No acceptance = no contract, no relationship, nothing owed.
Woody is right. There's no contract between you and the builder.
Ignore him and only reply if he sends a letter before claim (as it is known), formally starting court proceedings.
At that point I would just tell him "good luck".
No judge would award him even a penny based on what you told us.
 
Thanks to you all for responding, I appreciate it. I've spoken to a friend who is a solicitor and we are trying to decide whether to respond now to nip it in the bud or ignore for now and then leave him to make the next formal move, which we then formally respond to.

Friend has advised similar to Woody:

"From what you say, it looks as if there's no contract in place. To form a legally binding contract, there must be the following:

1. Intention to form contractual relations
2. Offer (quotation in this case)
3. Acceptance (by you) and
4. Consideration (£ prpposed financial exchange)"

It is clear in my messages with him, over a number of months, that I am repeatedly asking for a quote. Part of the problem is that it took him four months so there ended up being more communication between us, through my chasing, than should've been necessary. I did signal an intention to work with him and suggested a possible start date, and perhaps I ought to have been a little more careful around that (I am just trying to be as honest as possible so you understand the true picture). However, this just seems like part and parcel to me. I was after all competing with other customers trying to get work done by scarce workers who often these days seem to be able to choose who they fancy working for. If I say "yeah I might do this, might not, could work with you, do us a quote and I'll see..." I wouldn't be getting anywhere. Long story short is I was after a quote, didn't instruct him, and he knew this when he asked about my decision.

I do sympathise with his basic problem and don't take any pleasure from a person's time and money being used on it. But it cuts both ways. How many customers have been ripped off by builders who disappear and then declare bankruptcy? Or ditch you when a more lucrative and demanding client comes along? We all have to hedge our bets. If you want certainty, have a written agreement.

I might have been willing to give him 50 or 100 quid for petrol and plans printing, but he's probably too proud to ask for that. Because he has been dishonest and aggressive in his letter I am now wondering how many others he has done this to and who might have given in or got him to negotiate down to a nice 500 or 1000 for him? Doubt he's suddenly started with these tactics in his 60s.
 
All of us in the trade have done quotes and not done the job.
Dealing with potential customers is part of the trade and the costs associated with it must be factored into the budget.
Once I was "harassed" by a potential customer an hour away from me for a 10 day project.
I really didn't wanna do the job, but he insisted that I quoted him and he wanted me to do the job having had recommendation from one of my customers.
So eventually I went there, looked at the job, done a comprehensive quote and priced it up reasonably.
He disappeared.
Nothing you can do about it.
 

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