Thursday, May 12, 2011

Contruction Consultant Stiffed By Homeowners - Recourse?

A construction consultant contacted me regarding a homeowner who stiffed him for non-payment claiming that they were owner-builder and therefore employers and didn't have to pay him. He filed a Mechanics Lien and they stated that they were employers as this was an owner builder project and cited some legal reason supporting their case.

Now I don't know all the particulars but it appears that he was only paid for a portion of his consultations for the overall project. Which if true, the homeowners should be taken to task on this in the form of civil litigation.  But of course, the cost to do so may outweigh his fees that have not been paid and it will become a learning experience for him. 

Well, besides him needing to consult with a construction law attorney on just what recourse he has, (he is a contractor and mechanic lien rights are mandated statutes so I'm curious as to how this plays out)  the homeowners are required to register with federal, state and local governments as employers and pay their share of taxes. They probably didn't do that, and when he reports them to these agencies, the penalties and back taxes along with the hassle from government investigators will no doubt have them thinking if stiffing the guy was worth it. Karma does have it's way of coming around - good or bad!

I wrote an article on this subject awhile back. If you haven't read this article on Owner Builder you can read it here:

Tuesday, May 03, 2011

Contractor Problems

I received an email from a homeowner who after signing a contract and moving forward with their remodeling project soon realized they had made a mistake in hiring the contractor.  Which is pretty much what happened to us 11 years ago. My Horror Story and Warning Signs section offered her validation that she was not alone and needed to take action before things got worse.

Unfortunately, from this point forward there are going to be costs not anticipated, such as hiring an attorney to review a contract that is likely devoid of any protective clauses including right to terminate based on specific actions or lack thereof.  Time lines were not being honored by the contractor, who kept offering reassurances that all would be well. They want to terminate the contract but of course fear the ramifications of that and rightly so. In the mean time, they are trying to be patient, asking questions and hoping for the best.  So now they are at the mercy of their contractor, the very thing I teach folks how not to be!  It is my biggest pet peeve that consumers choose their contractors poorly and don't take the time to get educated on their rights, the contractors rights, contractor state laws such as Mechanics Liens, Preliminary Notices, Lien Waivers, background checks and so much more. 

People just don't realize the need to get informed on what I call the pre-renovation process that takes you through all the ins and outs of contracting for a home renovation project and understand what's at stake.

You need to prepare yourself to undertake a project that is going to consume your money and protect that consumption of money from being unfairly drained further due to poor choices and a lack of knowledge.  We consumers are the only ones that are responsible for protecting ourselves from unscrupulous business practices because the government can't and won't protect us. And litigation is a costly way to seek justice and to right a wrong.

If you're planning on renovating then plan on getting educated on the realities and risks and get informed - Join the Home[Pre]modeling Boot Camp for Women (and The Men Who Love Them!) and learn how to prevent a home remodeling disaster and have a more positive experience instead!