Can a contractor charge interest without a signed contract?

4 weeks ago

Good Evening,
We had a contractor install a new kitchen at our home. He also installed two (2) toilets & fixed a bedroom ceiling that had water damage from a roof leak.
There was no written contract.
I constantly asked him how much this project would cost & he always replied between $7,000.00 & $8,000.00.
The work was partially completed the week before Christmas but the contractor never installed the backsplash. Also, I had to engage another contractor to move a flexible gas line, had to engage another contractor to install the appliances & when this contractor moved the home thermostat he broke it. I had to purchase a new thermostat (over $400.00) and had to engage another contractor to install the thermostat.
While he was here I paid him $7,000.00 in several installments.
On March 1, 2020 I received an invoice for $9,050.00. I have made two payments toward the $2,050.00 with a final balance due of $550.00 due. The contractor is now threatening to charge interest if the balance is not paid in 10 days. It is COVID-19 & I am out of work. He would have been better to offer a small discount on the balance.
Is he entitled to interest without a signed contract?
Thank you

Additional info about this contractor
Project Role: Other
Project Type: Residential
Attorney Vaughan Baio & Partners
3 reviews

Absolutely not. Contractors who perform work without a contract do so at their own risk. If you did not agree to pay the total sum of $9,050 prior to performance, you do not have to pay that amount. In certain circumstances in Pennsylvania, contractors can enforce a verbal contract, but the burden is on the contractor to show that a firm cost was proposed to and accpeted by the customer. If your contractor provided neither a proposed contract nor written estimate for the work, he will have a hard time showing that he is entitled to that sum. I would tell him to go pound sand for trying to exploit a sitaution in which he failed to issue a written contract as required by the HICPA.  

Attorney Maiello, Brungo & Maiello, LLP
1 review

A contractor is entitled to interest on unpaid amounts even in the absence of a signed contract. However, it would only be at the legal rate, which is much lower that the rates typically seen in contracts. The contractor in this case has an even bigger problem than unpaid interest/contract balance. His failure to provide a written contract is a violation of Pennsylvania’s Home Improvement Consumer Protection Act (“HICPA”), which requires all home improvement to be in writing and prohibits the recovery of additional amounts without signed change orders. The contractor’s actions (i.e., his failure to complete the work) also would likely support a claim under Pennsylvania’s Unfair Trade Practices and Consumer Protection Law, which allows victims to recover treble damages (i.e., three times the amount of actual damages, which would be the cost of fixes the defective or incomplete work) and attorneys fees

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