Is the client supplying the wood?
We have had success in the past with the client supplying reclaimed timbers. The way I approached it was to stipulate in the contract that the timber was to be a certain species and a minimum grade. I sized the timbers with that species/grade in mind. I also say that we can reject any timber based on twist, bow, crown, or other defects. It helps to be specific, eg -- "Timbers are to have no more than 3/4" of crown in 16 feet" or "timbers are to have no more than 1/4" of twist" etc.
You have to retain control over the quality of the timber. This adds the potential for additional cost if you are waiting 2 weeks for the client to bring you another 8x10-20 because the last 3 were rejected. Make sure you cover that in the contract -- maybe you add a mobilization/demobilization fee each time you have to stop and wait for materials.
If you are supplying the materials, you either approve the timbers proior to buying them or stipulate that they have to be a certain grade. Realize you will have to buy extras.
The above was for fixed price contracts...
I would really consider doing the job on a time and materials basis. That takes a lot of the burden of estimating the impossible off of you and you can focus on doing a good job efficiently. Make sure you set a reasonable budget and keep to it. If something comes up that will negatively influence the budget (hidden defects in timber, etc), immediately inform the client of the circumstances and how much time and money it will add to the project. As long as you communicate thoroughly and start out with a reasonable budget, it is the best way to do these types of jobs.
Our experience is that while a lot of reclaimed timber is high quality wood (tight grain, dense, etc) you won't find very many timbers that will grade better than #2 because the bolt holes, etc are graded as loose knots and the checks are usually enough to knock it down to #2 alone.
Any hole or defect weakens the timber, whether it is plugged or not. As for how much, you'll need an engineer and possibly a timber grader to answer that.
We've found that it isn't cheap to build with reclaimed timbers because of these issues as well as increased labor (especially if using original surface or hewn timbers). The results can be absolutely great, though.
