My house renovation started in September. I contracted with this construction business owner on 8/20/2020. He verbally stated the job would take 2 months. We are going into the 4th month, with only 40% of the work completed but I have held up my end of the contract with payments and he now has 75% of the money owed. He’s late to the job, goes days without communicating and will not supply the materials I’ve paid for either saying the stores are saying they are out of stock or that he has to pick them up. At this point I’d like for him to either refund the difference from what has been paid minus the remaining work that has yet to be completed and finish out the jobs he started that haven’t been completed or fire him and get my money refunded for the jobs paid for that he has not begun
Hello,
Great question! I'm going to say some things you probably do not want to hear.
1. He probably does not have all of your money anymore. In all likelihood, he's used it to pay his guys, himself, and for some material but I have personally never seen that money still in the bank when problems like this arise.
2. If you pay him any more money, you may never see him again.
3. If you do not pay him, he will probably threaten to lien your property and, if he does, it is going to cost you money to have that lien removed.
Those are possibilities and are not guarantees, of course. Let's look at your options.
1. Refund the remainder of total paid minus work done. A valid strategy assuming his accounting is any good. This is definitely a good starting point because it opens up the conversation. In my experience, the accounting is rarely any good and it will take someone fluent in accounting to process the project accounting and you will need to pay for them because the contractor will not. Plus, the money would have to still be with the contractor.
2. Finish out the jobs. Another extremely valid ask. But it does not appear as if he has the motivation to continue for one reason or another. I discuss this further below.
3. Fire him and get refunded. You have the right to terminate him from the project if he is not performing. The possibility of a refund depends on whether or not he still has any of the money.
Consider the following:
Change the work process. Instead of letting him work on multiple locations at once, designate an area or trade that needs to be finished for him to get paid on that area or trade. For example: Electrical needs to be finished before he calls his plumbing guy. Plumbing and electrical need to be completed (and passed) before drywall. Then floors. Then individual rooms. Or whatever order you all decide is best.
This would require both parties to communicate with each other much more than they have been but it would show you IMMEDIATELY whether or not he's actually serious about continuing. In addition, you would be able to more closely monitor progress and where your money is going.
The downside, of course, is more of your time invested in the project and the likelihood that you will still have to terminate him and find another contractor and the money is gone.
E. Aaron Cartwright III
214.789.1354
Aaron@EACLawyer.com