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Can I enforce a canellation clause in a construction contract?

CaliforniaRecovery Options

Condo homeowner signed a 110k fire repair contract. They had no funding in place and didn't pay us the CA 1k deposit or the first draw of 25k. They then cancelled the contract before work could be started, although we have invested time and resources in mobilizing subs/etc.

1 reply

Jul 26, 2018
I'm sorry to hear about that. First, a payment remedy like a mechanics lien will likely not be available. While some pre-construction services might be lienable - such as architecture services - mobilizing subcontractors and preparing to begin work are not the type of costs that give rise to lien rights. However, if there was a written contract in place, recovery based on that contract may be possible through small claims court or via litigation - and threats to make a claim can also compel payment without actually having to take either action. Finally, if the contract had a provision that covers cancellation of the job, a threat to specifically enforce that provision can likely help compel payment, and a legal action taken over that clause could also lead to payment. Of course, depending on the action taken, recover might be more costly than it's worth.
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