Legal Question in Business Law in California

Opening a retail drink shop and worked with licensed contractor. Contractor is five months behind schedule, ran out of money because he used it for another job, frauded/lied about purchasing equipment required for build (resulting us in paying subs directly), intentionally has delayed job, demanded final payment despite terms of agreement (upon 100% completion and submittal to owner warranty and releases, and 20-day allowance after store open/operating to allow owner to obtain Landlord allowance), refused to do any more work until more monies paid and walked out on job. So same day he walked out, termination letter sent. Next morning, he asked to come back. We said if we do new agreement based on outstanding items. On Saturday with landlord as witness (because he threatened to sue landlord), we agreed on new terms and payment for remaining balance. He now refuses to sign any agreement, return any permit/construction cards unless we indemnify him of all liability which is something that we won't do. Considering the circumstances, how can we proceed should legal action be the next step? Or is there any other option to find some middle ground?


Asked on 11/26/13, 11:59 am

1 Answer from Attorneys

You are in an all too common mess that occurs when a contractor fails to manage the financial side of their business properly. You need to hire a lawyer IMMEDIATELY and get to work on finding a replacement contractor to finish the project. You also need to immediately file a complaint with the Contractors State License Board. The contractor is completely in the wrong in the situation you describe and should probably lose his license over it. Do not give in to his blackmail. This can probably be resolved without a lawsuit, but you need to have a lawyer at your back to coach you through this. I have over 25 years of experience in construction disputes and with exactly this kind of situation. I would be happy to help you with it, and I have an affiliation with a firm in San Jose to assist with Santa Clara County matters efficiently and economically. If I can be of assistance, please do not hesitate to contact me.

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Answered on 11/26/13, 1:05 pm


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