Legal Question in Construction Law in California

Re: fraudulent overbilling

It's very difficult for one lawyer to critique the work of another, or to predict the outcome of a particular case, with no more facts than can be squeezed into a LawGuru question. We're much more useful at answering general questions about broad legal principles.

However, given that limitation, I can make a few general observations about this fact pattern:

1. Fraud requires an intent to deceive, actual deception, and damages resulting therefrom. The wrong dates on the billing might just be sloppy record-keeping. Further, you weren't misled. There is at most an attempted fraud, and, unlike attempted crimes, attempted civil fraud is not directly actionable or punishable, although the same facts might help you win a contract action.

2. You are relying upon a written contact that said "no verbal orders." For one reason or another, such prohibitions may not be enforced. For example, what looks like an unauthorized oral modification to you may look like a totally separate and perfectly enforceable oral contract to the judge or jury. Further, the law frowns upon owners getting the benefit of contractors' services and finding ways not to pay them. If you did in fact make oral requests on the contractor that greatly expanded the scope or cost of the work, you may have what is called a quasi-contractual obligation to pay -- another phrase used is "quantum meruit" (legal Latin for "what it was worth").

In the big picture, if a contractor bids $6,000 and the same job he bid ends up costing him $12,000 due to bad estimating or bad luck, the contractor usually (but not always) eats the over-run. If, however, the contractor bids $6,000 and the owner ends up with $12,000 in value, for whatever reason, the owner will probably (but not always) end up paying, on either a contract or quasi-contract theory.

The request for $75,000 in damages seems excessive. Even if the contract sued upon has attorney fee and liquidated damages clauses, it's hard to imagine that the contractor could be entitled to anywhere near that much.

Alternative dispute resolution rules and policies differ from county to county, and even from judge to judge, so I can't be too much help on that score, either. Declining mediation may show your attorney is exceptionally clever, or maybe that he's a real dummy. Cases like yours usually settle in ADR, often through mediation.

Judges would much rather have cases settle than go to trial, but with an MSC coming up, you may be close to trial, and not knowing local rules in your county I can't advise whether you could get the judge to rearrange the schedule. The other side's willingness to mediate is also a factor. You don't need the judge's OK for a private attempt at mediation if it doesn't require postponing the MSC or the trial.