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How to get money back from subcontractor?

Hello, We own commercial property in Illinois and currently we are remodeling it to open restaurant. My husband is self GC. We have hired electrician who disappeared with the money. We had a closing for remodeling in Sept , electrician cashed check for material in Oct , never showed up for work, last time we saw him when he was picking up the check for 12K for material. We have SBA loan and 12K was paid from loan proceed, we fired him because he started to ignore us and never showed up for work. Was ordered by the bank to return the money by he didn't. What are our options right now? How do we get out money back and is there a timeframe to file anything with the attorney? thank you

2 replies

Dec 18, 2019

I'm sorry you've found yourselves in this all-too common situation. My firm may be able to assist you provided the electrician you hired is a legitimate, licensed business and you have a signed project contract. May I assume there was some stipulated conditionality on the SBA loan in terms of contractor credentials, bonding etc. to protect the bank? Either way, I'd be happy to chat with you about it and determine if my firm's expertise may be of value in the matter. Please call me at your convenience. Mike Ross Miller, Ross & Goldman 512-275-6412

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Dec 19, 2019

This appears to be a situation in which recovery may be best obtained through the filing of a lawsuit. Potential causes of action may include breach of contract or conversion (civil theft). In Illinois, a breach of contract lawsuit must be filed within 10 years is the breach involves a written contract, but that time period is shortened to 5 years if the breached agreement is solely verbal. This may also be a situation in which a case for "conversion" is appropriate. In order to show conversion in Illinois, certain factors must be met: 1. the plaintiff has a right to personal property, 2. the plaintiff has an absolute and unconditional right to immediate possession of the property, 3. the plaintiff has made a demand for possession of the property, and 4. the defendant improperly assumed control, dominion, or ownership over the property. While an individual may represent him/herself, a corporation or LLC is generally not allowed to do so. And, even when allowed, self-representation is almost always a bad idea. It is probably worthwhile to enlist the assistance of a local attorney who can guide you through the lawsuit process and get the appropriate claims made and documents filed. Or, if the time and expense of a lawsuit is not desired for any reason, other avenues for collection - like an external collections firm - may be able to help you get your money back.

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