When you are in a renovation project often the most difficult part of the project is finding a reliable contractor to do the job. Concerns of “costs” typically are at the forefront of the owners mind and contractors know this, so watch out!
In San Antonio this weekend I was consulting on a project where a contractor had been hired under the following scenario’s.
- Complete renovation of the Master Bathroom- The contractors invoice/contract stated 50% up front and 50% upon completion of the work.- The money was wired for the 50% upfront. a) the invoice also indicated that electrical would be paid separately b) electrical would be paid separately.
subsequent to the first contract a second contract was entered into “orally” and was to be documented by the contractor and placed into a written agreement. This agreement was to paint the entire house except for the upstairs bedrooms.
The quote was issued for 2,500.00 and all parties agreed to begin work.
A dispute arose regarding the painting of 2 rooms and a 1/2 bath. The contractor said I didn’t add that to the quote and then determined that the rooms equalled 1,200 square feet and therefore at his “discounted” price another 1,200.00 dollars or so was owed. The RED flag here is that the entire bottom level of the house was only 1900 square feet so how could a bedroom, study and 1/2 bath be 1,200 of those square feet? There was a kitchen, living room, dining room, laundry room, breakfast nook and hallways… hmmmm
The contractor then hired a plumber to come to the property and “drill” for plumbing. No contract was entered into between the plumbing company and the owner.
So far at this point in the scenario the contractor received 50% of contract #1, Electrician was paid 100% and a discussion was necessary regarding the discrepancy of contract #2.
The dirty little trick begins:
The contractor emails multiple invoices requesting the remaining balance to be paid for each job completed. Remember the #1 Contract is 50% up front and 50% upon completion. The contracts position is : “it means 50% of each separate job”… NO… the contract is for the entire job!
SOOOOOO…. I pull up, contractor has his truck packed up and his guys in it and tells me that he is leaving because he has not been paid. He says “you don’t want to pay, so I’m done”. Question is … Do you think the contractor has a right to walk away?
Answer from TX attorney is this:
- Contract #1 stands alone, so even if there is a dispute regarding the painting of the house ( Contract # 2) that is a separate contract and has nothing to do with contract # 1
- If the Contractor walks off and doesn’t finish the job they should refund the money for the work because they did not complete the project, they are not entitled to partial payment.
What about Contract # 2?
TX attorney feedback:
Same as above!
What are the consequences to the contractor for walking of?
- Damages- the cost of completing the project (essentially you are paying twice for the same job). This cost can’t be determined until you actually finish the project.
- Additional Travel expenses
- Time off work
- Legal expenses
- others as it pertains to each situation
Now let’s look at the plumbing company did they have a responsibility to enter into the agreement with the homeowner? YES!
When you have work done on your home you want to get a warranty. If the contractor hires the plumber and you as the owner don’t have a record of that then you don’t have a warranty. The plumbing company shouldn’t perform work on a property without the owners consent. Imagine if service providers just went into properties without any permission… wow!
Now that the contractor has walked off he sent a bill for all of the work that he supposedly finished and then threatens to place a mechanic lien on the property… How to deal with this next…
Please share your thoughts and experiences of working with contractors..