Legal Question in Construction Law in California
Inspections Signed Off, 100% Complete, Client Refuses to Pay
We have a signed contract with clients for a room addition and kitchen extension. We have completed the work, passed our final inspections, and clients have occupied the addition. Everything was OK, until I came to get paid, clients refused to pay me because the were not happy with the service all of a sudden, they were very happy the entire lenght of the project! Clients did not comply with pay sched. as stated on contract. We also did some work above and beyond our contract which I did not charge for. After this surprise I want to go after these folks and collect the contracted ammount and all the extras which are now being enjoyed by their whole family. The place turned out beautifully, no defects at all. To what extent can I go after these people? Contract states ''Final payment due at job completion, job completion is when we obtain the final inspection signature from city building inspector'', we did obtain this signature. I am a fully licensed, bonded and insured contractor, I was very generous to these people, now I want to unleash a legal onslaught to teach these people a lesson.
4 Answers from Attorneys
Re: Inspections Signed Off, 100% Complete, Client Refuses to Pay
A "legal onslaught", though sometimes appropriate, will not be necessary here. Your remedy is simple: (1) Properly record a mechanics lien, and (2) File suit to foreclose on the lien, as well as for breach of contract and unjust enrichment.
The lien being recorded against the house will undoubtedly gain your recalcitrant client's attention. If it does not, then being served with a lawsuit will likely do the trick.
This, of course, presumes that you are a licensed contractor. If you are not, then you have a host of problems facing you and will have a difficult time collecting, if at all.
There are strict statutory deadlines governing both when a mechanics lien can be recorded, as well as when you must foreclose on the lien. To protect yourself, you should immediately seek out a collection lawyer familiar with liens.
We are collection litigators with extensive experience in both perfecting and foreclosing upon mechanics liens, as well as prosecuting and defending lien claims. If you would like to discuss your matter further, feel free to call or email.
Good luck.
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Re: Inspections Signed Off, 100% Complete, Client Refuses to Pay
Mr. Guerrini is correct, but there are other legal remedies available to you as well. The Civil Code, sections 3260 and 3260.1, require that an owner pay a contractor promptly or you can also demand penalties of 2% per month on the balance plus mandatory attorney's fees. Mind you, most contractors who sue for payment are met with a cross complaint that something is wrong with the construction. Of course, if there was no indication during the construction that anything was wrong, the cross complaint may ring hollow. I will warn you, however, that no matter how good a contractor you are, there is always some fault that an expert can find with your work. So, be aware, that this may be the path that will develop.
Re: Inspections Signed Off, 100% Complete, Client Refuses to Pay
Experienced contractor's attorney, practices throughout California for 18 years. I like how articulate you are-especially the unleashing part. Call me directly at 16192223504.
Re: Inspections Signed Off, 100% Complete, Client Refuses to Pay
NO problem, all you have to do is sue. "unleasing" costs money though, and you would be well advised to find counsel that will work to maximize your net recovery and get paid quickly. Feel free to contact me if interested in doing it right.
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