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What steps can I take to recover unpaid invoice for an order that was delivered in Oct. 2018

New JerseyConstruction ContractMechanics LienPayment DisputesRecovery OptionsRight to Lien

Hello, I'm a door retailer located in Austin, TX. I sell my doors nationwide. I sold custom made doors to a customer in NJ. The customer disputed the credit card charges on Dec. 15 and refused to return the product. The order was shipped to the customer in Oct. 2018. What are my options and how should I go about it. Thank you!!

1 reply

Mar 11, 2019
I'm sorry you have found yourself in a situation in which a customer refuses to pay for a product you delivered. There are many paths toward recovering money due in construction, I will provide some information that I hope will be helpful, below.

While New Jersey's lien law statute doesn't specifically mention "specially fabricated materials" it is generally only the case that a supplier must rely on specially-fabricated statutes when the items are refused or not incorporated into the improvement. When materials are accepted and actually used, the materials are generally subject to the same protections whether they were specially fabricated or standard.

One general option for recovery is through a mechanics lien. However, in New Jersey, the deadline by which a mechanics lien must be filed is either 90 or 120 days after the claimant's last furnishing material to the project, depending on whether the project is commercial or residential. Accordingly, depending on whether the delivery on October was the sole and last delivery to the project, the deadline for mechanics lien protection may have passed, but that is not the sole opportunity for recovery.

In addition to mechanics lien laws, there are other protections and paths to recovery available in New Jersey. New Jersey has prompt payment statutes that require payment in a certain amount of time, and depending on whether the contract was with a property owner or contractor, there may be an opportunity to make a claim against a non-paying customer's license bond.

Finally, there is always litigation - and claims can be pursued for multiple causes of action including breach of contract, unjust enrichment, prompt pay violations, fraud, etc. If the amount in question meets the appropriate cap, it may be something that could be litigated in small claims court to save time and expense, but if the amount in questions exceeds that limit, it would need to be a full-blown suit.

Finally, depending on what the terms of the contract agreement was, there may be additional security provisions (such as the ability to file a UCC lien, or similar) built into the contract terms themselves. I hope you are able to get paid.
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