Legal Question in Construction Law in California

Re: Hierd Contractor didn't complete the backyard job ....

As you know, the small claims jurisdictional limit is $5,000. You can forego the excess and sue for $5,000 money damages. The advantages of using small claims are a much earlier trial date, lower (or perhaps nil) legal fees, and simplicity.

If you sue in one court and lose (or win), as a general matter you cannot go to another court, either higher or lower, and obtain another trial due to the principle of 'res judicata' which says that once a dispute is adjudicated on its merits, a party may not shop around for a more favorable outcome.

An exception, of course, is that losing parties always have the right of appeal, and appeals from small claims decisions are heard in superior court by 'trial de novo' (new trial).

So, the answer to your first question is no.

The answer to your question about having all the documents is not so simple. The best approach is to think through the steps you would take to tell your story to a stranger in order to convince that stranger of your financial injury and the validity of your claim of financial harm at the hands of the contractor. Then find the documents that illustrate or prove each fact you assert. This would include the contract itself, the canceled checks or other proof of payment, and, if you have them, before and after pictures. Hopefully, the contract sets forth the desired result clearly. In small claims, it helps the plaintiff to have the items mounted and labeled, and to have copies for the defendant, the judge, and yourself.

Your third question about the economics of retaining a lawyer has no plain and simple answer here. For example, if your contract contains an attorney fee clause and you are reasonably confident you can win AND collect your judgment, you are more likely to get a lawyer.

Generally, I'd say, if your claim is potentially for $10,000 or more, go to Superior Court with an attorney. Less than $7,500, eat the difference and sue in small claims. In between is a grey area. Other lawyers might have a different opinion.

Sometimes it is helpful to pay for an hour or two of attorney assistance in preparing a small claims case. This is permissible even though the lawyer is not allowed actually to appear in court on your behalf.

If you decide to go to small claims court, you should buy a book on how to prepare and win your small claims case. There are several.

Re: Hierd Contractor didn't complete the backyard job ....

This is a very easy one for me to answer. I can give you legal advice. After I hear all of the facts with all of the information I sometimes can give you percentage chances of winning or losing. Winning means collecting money not just getting a judgment and you always have to think realistically does this guy have enough assets for me to collect them now or in the future. A judgment is good initially for ten years. If he goes bankrupt though, without being able to prove fraud, a breach of contract action is purely dischargeable in bankruptcy. That means the law allows him to get out of paying. Now I don't have to chide you about what you did wrong and rub salt in the wound you already know that. Your analysis is excellent in terms of the questions you have asked. Now, in answer to your question, remember that easy one for me, it is this is a business decision which only the client can make. You have to determine whether you wish to proceed and pay the attorney and hopefully recoup or not. Only you know the situation as well as your own financial situation. Personally, I don't know any attorney who would take this kind of case on a contingency. There may be in that long contract of yours which no attorney prepared an attorneys fee clause if you're lucky. Most importantly though now is the time that you should finally get yourself a good business attorney to talk with you. Had you had one from the outset I can guarantee you with that you would would not have paid 75 percent upfront, especially to an unlicensed contractor. Additionally, some attorneys after they send a letter on behalf of the client can, "catch the attention" of the other party. Catch in such a way that a settlement can be worked out and more importantly payments or a payment plan. I have been dealing situations like this for over thirty years in the San Francisco Bay Area in my practice of real estate law. If you wish to contact me for consultation I am at 925 -- 945 -- 6000.

Re: Hierd Contractor didn't complete the backyard job ....

I agree with Mr. Whipple, but I'd like to put some more emphasis on how difficult it may be to collect from an unlicensed contractor. My experience has been that unlicensed contractors are unlicensed for a reason. They don't have the organizational skills to run a successful business. They live day to day from paycheck to paycheck. I find, therefore, that they rarely have any assets that you can attach once you get a judgment. They create tremendous problems for consumers.

I'd strongly suggest filing a complaint with the Contractors State License Board and even the police because contracting without a license is a crime. It sounds like he took a lot of money from you without giving you much, if anything, in return, so it's the equivalent of theft. The police like to label this kind of activity a "civil matter" and may grump about taking a report. Ask them politely to do it anyway and then see if you can get the District Attorney to file against him. This may be the best way to collect against him because you might get the DA to request an order for restitution in the criminal matter. As attorneys, we can't threaten anyone with criminal prosecution in order to gain an advantage in a civil matter, but consumers aren't so proscribed.

Re: Hierd Contractor didn't complete the backyard job ....

You can recover ALL the money you paid to an unlicensed contractor under the Contractors State License Law, Business and Professions Code section 7031 (b). This INCLUDES the money paid for any work that you were satisfied with. This should be an easy case to win as long as the contractor was not EVER licensed. It does not matter whether or not you knew he was licensed when you hired him.

As far as going to civil court or small claims court goes, you can only choose one. If you go to small claims court and lose as a plaintiff, you CANNOT appeal. Only those persons who are found to owe money to the other party can appeal a small claims court decision.

Since this case has a fairly straight forward issues - recovering your money from an unlicensed contractor - it should not be too expensive because a Motion for Summary Judgment or Adjudication can be filed and you should be awarded damages against him if he cannot produce a Certificate of Licensure for his business. However, nothing in court is a guarantee. If you have other claims against the contractor that you want payment for, then expect to go all the way to prove those.

The best documents you can have is proof of payments which can be the cancelled checks you used to pay him. If you do not get your checks back with your monthly statements, then order copies from your bank as soon as possible.

You can also turn the contractor into the Contractors State License Board, but generally that will not help you get the money you seek.