Homeowner contracted with GC and construction lender to build my house. Lender released payments work not completed, contractor didn't pay his workers , lender released plumbing fixtures draw, fixtures never purchased, contractor stoped working , did lender breach contact ?
I'm struggling to follow the exact chain of events here, but from what I can tell, the lender and GC both released funds for payment to subcontractors who had not completed their work or purchased specified materials. I'm quite familiar with lender/construction lending contracts, and I can tell you that usually any liability for the approval of work and authority to release funds is usually assigned to another party such as the general contractor or sometimes both the GC and the owner. Frankly the liability likely lies more with the GC as that is typically the party charged with responsibillity under the contract and under the law to provide a homeowner with lien releases and other subcotnract information on residential projects, but that too depends, to an extent, on the terms of the contract. Likewise, it can be difficult to capture a lender in breach for releasing funds, but I can't give you a certain answer without reviewing the contracts in play.
Very best,
Ben
281-762-1377
ben@houseperron.com
Hello,
We need additional facts. To determine breach of contract, we would need to know what the lender's responsibilities under the contract were. Given the facts you have presented here, it is likely that the lender's only obligation was to make payments on a set schedule.
E. Aaron Cartwright III
214.789.1354
Aaron@EACLawyer.com