How do I get paid if the owner has fired the GC

8 months ago

I am an electrical contractor. I got hired to do a remodel by a GC. After I did all the rough electrical he paid me for that portion of the project. Now I’m waiting to do the finish work. In the meantime the GC and the owner have had major issues. I received a message from him saying that I need to deal directly with the owner from now on. The owner says she has already paid the GC in full, so I need to do the work then get paid by the GC. I’m supposed to start the finish next week. How do I make sure I will get paid?

Chief Legal Officer Levelset
134 reviews

In California, construction participants are generally protected against non-payment through the right to file a mechanics lien, among other protections.

To retain lien rights, parties who do not contract directly with the property owner are required to send preliminary notice in California. This notice is to be provided to the property owner, the direct contractor (GC), and the construction lender (if any). While California preliminary notices must be sent within 20 days of first furnishing labor or material to the project in order to be fully protected, notice can be sent late and still be effective to protect work beginning from 20 days prior to the date on which the notice was sent.

Since California is a “full-price” lien state, it doesn’t matter whether the property owner has paid the GC, and, provided the required notices and other requirements are met, a subcontractor could still file a lien claim for the total amount due and enforce the lien through a foreclosure action.

Other than using lien rights, any potential recovery would likely need to be with the party with whom the contract was made. Recovery from a contracting GC may be accomplished through a lawsuit, pursuant to a cause of action of breach of contract, violation of prompt payment rules, or something else.

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