Subcontractors can also file for a Mechanic's Lien if they have not been paid.
Did the builder say why they were not going to complete the job?
Are they going out of business?
Are they filing for bankruptcy?
1.5 Years after Dig Day, Our Builder Quit!
- Thread starter sll0037
- Start date
Did the builder say why they were not going to complete the job?
Are they going out of business?
Are they filing for bankruptcy?
The Texas Construction Trust Fund Act (CTFA), also known as the Trust Fund Statute, is a Texas law designed to protect subcontractors and suppliers on construction projects by requiring contractors to hold construction payments in trust for their benefit.
Specifically, it mandates that contractors treat construction payments as trust funds and that they must be used to pay subcontractors and suppliers before being used for other business purposes.
Here's a more detailed explanation:
Key Provisions of the CTFA:
Trust Fund Status:
Construction payments made to a contractor or subcontractor are classified as trust funds.
This means they are held for the benefit of subcontractors and suppliers.
Trustee Responsibilities:
Contractors are considered trustees of these funds and have a fiduciary duty to manage them properly.
This means they must use the funds responsibly and prioritize paying subcontractors and suppliers before using the funds for other purposes.
Construction Account Requirements:
For residential construction projects exceeding $5,000, contractors are required to establish and maintain a construction account at a financial institution to hold trust funds.
Criminal Penalties for Misapplication:
Misapplication of trust funds can result in criminal penalties, including class A misdemeanors and third-degree felonies, depending on the circumstances and the amount of funds misapplied.
Protection for Subcontractors and Suppliers:
The CTFA aims to protect subcontractors and suppliers by ensuring they are paid for their labor and materials.
It provides them with a way to recover funds that have been misapplied by the contractor.
Specifically, it mandates that contractors treat construction payments as trust funds and that they must be used to pay subcontractors and suppliers before being used for other business purposes.
Here's a more detailed explanation:
Key Provisions of the CTFA:
Trust Fund Status:
Construction payments made to a contractor or subcontractor are classified as trust funds.
This means they are held for the benefit of subcontractors and suppliers.
Trustee Responsibilities:
Contractors are considered trustees of these funds and have a fiduciary duty to manage them properly.
This means they must use the funds responsibly and prioritize paying subcontractors and suppliers before using the funds for other purposes.
Construction Account Requirements:
For residential construction projects exceeding $5,000, contractors are required to establish and maintain a construction account at a financial institution to hold trust funds.
Criminal Penalties for Misapplication:
Misapplication of trust funds can result in criminal penalties, including class A misdemeanors and third-degree felonies, depending on the circumstances and the amount of funds misapplied.
Protection for Subcontractors and Suppliers:
The CTFA aims to protect subcontractors and suppliers by ensuring they are paid for their labor and materials.
It provides them with a way to recover funds that have been misapplied by the contractor.
- Nov 12, 2017
- 12,710
- Pool Size
- 12300
- Surface
- Plaster
- Chlorine
- Salt Water Generator
- SWG Type
- Pentair Intellichlor IC-40
I like Matt's advice a lot. Get something "official" that terminates the contract. An email, plus the obvious abandonment, would likely suffice in court, but a signed document might go a long way in keeping the contractor from even trying to pull a stunt. You definitely want, in writing, that all the materials on site are yours to keep, no money owed.
I hope the balance sheet is not too negative. The reality is, you are not likely his only victim. Others will be lining up to grab a piece of a pie that doesn't even exist (which is why you want to safeguard those materials from being considered his assets). Sometimes it's first-come-first-served, other times you all split up the crumbs. I can't imagine either resulting in an amount that will be worth the stress, let alone the legal fees to pursue it. And that's if he doesn't declare bankruptcy, if that's a thing in Texas. The fact that he bothered to notify you at all, and that he has a lawyer, indicates he's probably already on that path. An attorney can advise a course of action. And a good attorney will advise there isn't one if there isn't one.
So there is some urgency, on the off chance that first-come-first-served is a possibility. But the more important factor is our current economy. If you have all of your materials, great. If not, it's very likely they will cost a whole lot more in the coming months. Secure needed materials and equipment asap (pump, filter, etc).
Good luck, and so sorry this has happened to you. Get the pool done, and enjoy it. Focus on that, and maybe let the rest go as best you can. Maybe he took some money from you, but don't let him take anything else (your time, energy, peace of mind, attitude, etc).
I hope the balance sheet is not too negative. The reality is, you are not likely his only victim. Others will be lining up to grab a piece of a pie that doesn't even exist (which is why you want to safeguard those materials from being considered his assets). Sometimes it's first-come-first-served, other times you all split up the crumbs. I can't imagine either resulting in an amount that will be worth the stress, let alone the legal fees to pursue it. And that's if he doesn't declare bankruptcy, if that's a thing in Texas. The fact that he bothered to notify you at all, and that he has a lawyer, indicates he's probably already on that path. An attorney can advise a course of action. And a good attorney will advise there isn't one if there isn't one.
So there is some urgency, on the off chance that first-come-first-served is a possibility. But the more important factor is our current economy. If you have all of your materials, great. If not, it's very likely they will cost a whole lot more in the coming months. Secure needed materials and equipment asap (pump, filter, etc).
Good luck, and so sorry this has happened to you. Get the pool done, and enjoy it. Focus on that, and maybe let the rest go as best you can. Maybe he took some money from you, but don't let him take anything else (your time, energy, peace of mind, attitude, etc).
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This is a most important point. The contractor left you with a partially completed pool. However, if he has not paid his subcontractors they could come back to you (and other homeowners who have non-completed pools as well). So having a lawyer will help sort through all the possible scenarios that may become reality.
- Nov 12, 2017
- 12,710
- Pool Size
- 12300
- Surface
- Plaster
- Chlorine
- Salt Water Generator
- SWG Type
- Pentair Intellichlor IC-40
This is unfortunately a real, and sucky, possibility. In California, contractors are supposed to issue you a prelim (preliminary lien notice), before they begin work. These prelim's serve as notifications of who everyone is that is going to work on your project, and that they have the right to lien your property if they don't get paid. Then it's up to the customer (you) to demand lien releases from the subs before paying the general. Something of which most consumers are unaware, unfortunately.
Technically, if a sub never issued a prelim, then he can't later lien you. But even in CA, that's a grey area, because they can (and will) lien you either way, and then you have to defend against any that failed to issue the pre-lim. Which can be an expensive proposition, even if it's later determined that they can't collect. Then it's up to the judge to decide who gets the bill. If a sub did the work without getting paid, you technically did receive the value of the work. That's the sticky part. Basically the judge has to decide which of the innocent parties, you or the sub, is going to get screwed. I have no idea how that works in TX.
Did you ever receive any prelim's? That would be something to discuss with your attorney. The ideal scenario is to have the aforementioned doc in hand, the one that cancels the contract, awards you all the materials on site, and serves as a lien release for every sub-contractor that worked on the job. That's a wish list that may be difficult or impossible to attain, but that's the goal. In fact, if you'll be interviewing attorneys to find the right fit, a good indicator of that fit would be an attorney that rattles off that list to you, before you mention any of it.
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All,
Unfortunately, we are in dire straights. The builder did not give a reason for abandoning the job, but I imagine he will try to say we were too difficult to work with which is laughable at best.
Hello Salvador,
After much thought and counsel from my attorney, we have decided to no longer work on this project and will be stopping all construction. I understand that this is an inconvenience to you guys but this in the best interest of *** an its employees.
Should you wish to seek council, I will ask that all future communication be made through my attorney.
***
I will be working on an excel spreadsheet that will outline monies received and expenses paid and will send this to you tomorrow.
Pool Owner"
The builder has received 50% of the loan amount (lyon financial) of a contracted amount close to $137k. In his email, he stated he'd send me an account of all funds received and spent by end of business the following day. You can guess, he has not met that commitment either. I would assume he should have spent way less than received up to this stage of completion.
We purchased all the material with our own money, under the agreement he would refund us the cost since it was built into the agreement. The reason for this was because we didn't like his material selection and acquired our higher end materials through a family member who works for Daltile. We trusted him to refund us.
I'm not familiar with Texas Law, but I believe we would need to be served with a lien notice, which has never happened.
The owner owns this pool company, which I believe to be a relatively new entity, and a sprinkler company I believe has been in business for 20+ years. I'll have to talk to an attorney to see if he screwed himself in widening his liability by using both his companies for labor on our project. A couple of months ago, I started feeling this might be the result, so I started to take photos of his company vehicles at my house which clearly showed the sprinkler company and not the pool company logo. I'm Hispanic, and built trust with many of the laborers, contractors and his direct employees, and I know for a fact many of them were solely sprinkler employees because they told me. For example, when they were digging out cave ins during the dig, he exclusively sent 2-10 sprinkler employees for the manual labor.
I'm going to need to dedicate some time to piece together all of our communications, documents, pictures, etc. some of which I documented in this thread.
I don't believe I'll have the time or energy to GC this myself. My wife and I both work demanding jobs for a Fortune 10 company and I've missed a substantial amount of time at work over the last year due to health issues which this situation surely did not help over the past 1.5 years. I wouldn't feel right continuing to put my job on the back burner to dedicate more time to my personal life. I already prioritize my wife and two toddlers and I need to keep my work relationship equitable.
My wife and I are blessed but certainly not swimming in free money. We both come from extremely humble beginnings and worked our way diligently to our current positions and lifestyle, but hopefully we can figure out a path forward to not let this devastate us.
I appreciate everyone's help, advice, and suggestions. Even sharing and reading your comments makes this situation much more bearable. Thanks again and keep them coming! I'll keep everyone updated.
Unfortunately, we are in dire straights. The builder did not give a reason for abandoning the job, but I imagine he will try to say we were too difficult to work with which is laughable at best.
Hello Salvador,
After much thought and counsel from my attorney, we have decided to no longer work on this project and will be stopping all construction. I understand that this is an inconvenience to you guys but this in the best interest of *** an its employees.
Should you wish to seek council, I will ask that all future communication be made through my attorney.
***
I will be working on an excel spreadsheet that will outline monies received and expenses paid and will send this to you tomorrow.
Pool Owner"
The builder has received 50% of the loan amount (lyon financial) of a contracted amount close to $137k. In his email, he stated he'd send me an account of all funds received and spent by end of business the following day. You can guess, he has not met that commitment either. I would assume he should have spent way less than received up to this stage of completion.
We purchased all the material with our own money, under the agreement he would refund us the cost since it was built into the agreement. The reason for this was because we didn't like his material selection and acquired our higher end materials through a family member who works for Daltile. We trusted him to refund us.
I'm not familiar with Texas Law, but I believe we would need to be served with a lien notice, which has never happened.
The owner owns this pool company, which I believe to be a relatively new entity, and a sprinkler company I believe has been in business for 20+ years. I'll have to talk to an attorney to see if he screwed himself in widening his liability by using both his companies for labor on our project. A couple of months ago, I started feeling this might be the result, so I started to take photos of his company vehicles at my house which clearly showed the sprinkler company and not the pool company logo. I'm Hispanic, and built trust with many of the laborers, contractors and his direct employees, and I know for a fact many of them were solely sprinkler employees because they told me. For example, when they were digging out cave ins during the dig, he exclusively sent 2-10 sprinkler employees for the manual labor.
I'm going to need to dedicate some time to piece together all of our communications, documents, pictures, etc. some of which I documented in this thread.
I don't believe I'll have the time or energy to GC this myself. My wife and I both work demanding jobs for a Fortune 10 company and I've missed a substantial amount of time at work over the last year due to health issues which this situation surely did not help over the past 1.5 years. I wouldn't feel right continuing to put my job on the back burner to dedicate more time to my personal life. I already prioritize my wife and two toddlers and I need to keep my work relationship equitable.
My wife and I are blessed but certainly not swimming in free money. We both come from extremely humble beginnings and worked our way diligently to our current positions and lifestyle, but hopefully we can figure out a path forward to not let this devastate us.
I appreciate everyone's help, advice, and suggestions. Even sharing and reading your comments makes this situation much more bearable. Thanks again and keep them coming! I'll keep everyone updated.
Thanks for the update. So as I understand it, the PB is simply cancelling your project. He is not filing for bankruptcy or other similar issue. This is very interesting and will follow contract law. Pull out the contract and look at the termination clauses. Engage a lawyer that is experienced with contract law. Good Luck and keep us posted.
Your firm should be very proud of your dedication and especially your family for the love and support you obviously provide to them.
Your firm should be very proud of your dedication and especially your family for the love and support you obviously provide to them.
The contract is sadly lacking any detail, which I attempted to get him to be more specific before signing but never happened.
You might be surprised to hear that nothing in the T&C's addresses performance or termination. All the T&C's are related to warranty and nothing else. The entire contract is only 2 pages long.
I've purposely omitted the business name and owners name because I wasn't sure what forum rules were specific to these situations, but I can attach the contract if that's deemed ok.
Thank you for the kind words. I truly appreciate it. I feel a ton of guilt for putting my family in this position. I make all the financial and important decisions for our family and I feel like this is my fault. I did not want a pool to begin with, but I relented to make my wife happy thinking this would be great for our little girls too, but I obviously rushed this decision which is highly unlike me. I feel like I let them down.
- Feb 6, 2015
- 8,055
- Pool Size
- 12300
- Surface
- Plaster
- Chlorine
- Salt Water Generator
- SWG Type
- CircuPool RJ-45 Plus
Don't post the contract or any names.
Contact a contract lawyer.
Contact a contract lawyer.
kul
Bronze Supporter
- Oct 1, 2021
- 1,452
- Pool Size
- 15000
- Surface
- Plaster
- Chlorine
- Salt Water Generator
- SWG Type
- Pentair Intellichlor IC-60
This could and has happened to others. Even with the best of intentions and preparation there are times where crummy things just unexpectedly happen. At this time, focus on what you can do to resolve this situation and move forward. The could have should haves never lead to anything great. I’m sorry you’re going through this.
- Nov 12, 2017
- 12,710
- Pool Size
- 12300
- Surface
- Plaster
- Chlorine
- Salt Water Generator
- SWG Type
- Pentair Intellichlor IC-40
Frankly, I just heard some good news:
- You're only in 50% (not counting those materials you paid for). And you have a hole filled with gunite, right? We've heard plenty of stories here that were far, far worse, including less construction and up to 100% paid.
- If I read correctly what you've written so far, you're at the gunite stage, which means a lot of the construction is still to come. Once you find a better contractor, I'm confident you'll end up with a better end result, since it won't be this incompetent contractor doing any more work. Many times, a disgruntled contractor has the right to finish the job, and that can turn into a real nightmare, because he's going to cut corners to recoup his profit, or just out of spite. Now, you'll be free to hire a better guy, and get a better pool, because this guy is out of your hair for good, without you having to use legal tactics to get rid of him. He's done you a favor, at least in that regard.
- His contract is a joke. That will work against him. In CA, a construction contract has to contain many components, or it is virtually null and void. And it is on the contractor to furnish a proper contract, because he is the expert (there's a legal term for this, which I forget). So a thin contract will contain a lot less provisions, or none, that would protect the contractor, and that's good. If the contract doesn't contain specific language for termination, then there are no implied termination provisions, which means any decent judge will have to side with you if any termination terms are in dispute. All good, assuming TX treats contracts like CA does.
- It sounds like he may still be in business, either with the pool company or the other company, or both. This is FANTASTIC if true. That means he has assets, and a reason to protect them. Which is just more leverage for you. You'll be negotiating from a position of strength, instead of trying to squeeze blood from a stone.
- His language about supplying a spreadsheet of the financials is also good news, because that would mean my assumption that he was bankrupt and/or broke and/or going out of business might not be the case. Which means he's got something to lose, and assets that can be seized if he owes you money (which he probably does). It sounds like he's trying to back out of the contract with a minimal loss to him, but a decent lawyer (yours) will make mince meat out of that. He's breeched the contract (which provides no terms for termination), and that too places you in a position of strength during negotiations (or with the judge).
Based on all this, a best case scenario might be that he could be liable for the entire 50% you've paid. That may not be likely, but breeching a contract is a serious matter that has way more repercussions than the contractor getting to state what is paid and owed and then trotting along on his merry way. What he did is highly illegal (at least in CA), and that, too, could be a good thing in terms of leverage. Now a more likely scenario, and what would be fair, is for a third party to determine the value of the work done to date, and for the judge (or the two attorneys) to then do the math to make you whole. In other words, you pay for the industry standard value of the work done to date, minus some sort of penalty for his breech and leaving you in the lurch, and then the judge rules he must pay you the balance (the difference between what he collected and what he did). He should also pay for an expert to assess the work completed to ascertain its worthiness (perhaps some core sample analysis of the shell to confirm it was done property, and a plumbing test, etc), all of which he would pay for. Along with all your attorney fees too.
I'm making a lot of assumptions, but as I said, I heard a lot of potential for, well, maybe not an ideal outcome, but certainly one not as bad as I was picturing. I truly hope that is the case.
Put your energy into finding a good attorney, and a great contractor, and then let them do their jobs. Then let it go and let it resolve itself while you refocus on what is ultimately way more important: you, your family and your peace of mind. Best of luck.
- You're only in 50% (not counting those materials you paid for). And you have a hole filled with gunite, right? We've heard plenty of stories here that were far, far worse, including less construction and up to 100% paid.
- If I read correctly what you've written so far, you're at the gunite stage, which means a lot of the construction is still to come. Once you find a better contractor, I'm confident you'll end up with a better end result, since it won't be this incompetent contractor doing any more work. Many times, a disgruntled contractor has the right to finish the job, and that can turn into a real nightmare, because he's going to cut corners to recoup his profit, or just out of spite. Now, you'll be free to hire a better guy, and get a better pool, because this guy is out of your hair for good, without you having to use legal tactics to get rid of him. He's done you a favor, at least in that regard.
- His contract is a joke. That will work against him. In CA, a construction contract has to contain many components, or it is virtually null and void. And it is on the contractor to furnish a proper contract, because he is the expert (there's a legal term for this, which I forget). So a thin contract will contain a lot less provisions, or none, that would protect the contractor, and that's good. If the contract doesn't contain specific language for termination, then there are no implied termination provisions, which means any decent judge will have to side with you if any termination terms are in dispute. All good, assuming TX treats contracts like CA does.
- It sounds like he may still be in business, either with the pool company or the other company, or both. This is FANTASTIC if true. That means he has assets, and a reason to protect them. Which is just more leverage for you. You'll be negotiating from a position of strength, instead of trying to squeeze blood from a stone.
- His language about supplying a spreadsheet of the financials is also good news, because that would mean my assumption that he was bankrupt and/or broke and/or going out of business might not be the case. Which means he's got something to lose, and assets that can be seized if he owes you money (which he probably does). It sounds like he's trying to back out of the contract with a minimal loss to him, but a decent lawyer (yours) will make mince meat out of that. He's breeched the contract (which provides no terms for termination), and that too places you in a position of strength during negotiations (or with the judge).
Based on all this, a best case scenario might be that he could be liable for the entire 50% you've paid. That may not be likely, but breeching a contract is a serious matter that has way more repercussions than the contractor getting to state what is paid and owed and then trotting along on his merry way. What he did is highly illegal (at least in CA), and that, too, could be a good thing in terms of leverage. Now a more likely scenario, and what would be fair, is for a third party to determine the value of the work done to date, and for the judge (or the two attorneys) to then do the math to make you whole. In other words, you pay for the industry standard value of the work done to date, minus some sort of penalty for his breech and leaving you in the lurch, and then the judge rules he must pay you the balance (the difference between what he collected and what he did). He should also pay for an expert to assess the work completed to ascertain its worthiness (perhaps some core sample analysis of the shell to confirm it was done property, and a plumbing test, etc), all of which he would pay for. Along with all your attorney fees too.
I'm making a lot of assumptions, but as I said, I heard a lot of potential for, well, maybe not an ideal outcome, but certainly one not as bad as I was picturing. I truly hope that is the case.
Put your energy into finding a good attorney, and a great contractor, and then let them do their jobs. Then let it go and let it resolve itself while you refocus on what is ultimately way more important: you, your family and your peace of mind. Best of luck.
I've been doing some research and I'm feeling hopeful given the circumstances. I've already got another contractor scheduled to come this weekend to bid on completing the build. He's been in the gunite business for a long time prior to starting his own pool company, so I'm hoping he can give me a reasonable assessment of the quality of the work done so far, which is really only gunite.
I also plan to bring in some more quality builders to get bids and get a sense for who if anyone will take on completing our project.
Hopefully it helps that I documented many of the conversations I had with the owner over the last 1.5 years in this thread and that gives me credibility, because in the last meeting with the owner 2 weeks ago, he flat out lied about previous conversations we had, like when he wanted to walk away as the dig went south. In December 2023, I was very clear with him that if he walked away there would be consequences. And if he decided to gunite, it would mean this pool was his to complete 100%. He gave me that commitment and I clearly documented that here on Page 10/11. I'd also been taking notes throughout and did my best to put things in email.
Of course, being here now... I'm thinking I could have done better at documenting, but I think I have enough to put the law squarely on my side.
The good news is that I have a good amount of money saved that I can dump into this project to complete it if things reasonably fall into place. The bad news is that I was hoping to not touch that money given our current economic climate and the situation at our current workplace. We've been laying off people in droves, and no one is ever truly safe. We currently have about 140k employees and will likely reduce to 90k in the next year or so. That's a ton of risk and my savings made me feel safe for a year or so if one of us was to get laid off.
Hopefully it all works out.
I will tell you that putting the things you talked about with your ex-PB here will not count in a court of law. It needs to be documented through emails, texts, written and sign letters that were between the PB and yourself. (Note: I did not go back to reread the early part of the thread. I am hopeful you DO have the documentation needed.)
- Nov 12, 2017
- 12,710
- Pool Size
- 12300
- Surface
- Plaster
- Chlorine
- Salt Water Generator
- SWG Type
- Pentair Intellichlor IC-40
You and your attorney will decide on what to focus, but IMO:
- the bit about him using his sprinkler guys for labor... there's probably nothing there. I can't imagine that being an issue, one way or another. Maybe if they were undocumented, but so what?
- and the notion that it matters that he said this or that about walking away, or agreeing to finish if he started the gunite, that's also here nor there.
You're probably over-thinking all of this. Relax. I recognize that in you because I am the same way. It's nerve racking, for sure, and we tend to get carried away with the minutia, instead of seeing the big picture.
You and he entered into a contract (in writing) to build a pool. He didn't finish it. The end. Your documentation will, indeed, help with your credibility, sure, but the proof of the matter is the glaring unfinished pool in your backyard, the date on the contract, the cancelled checks (I'm assuming you can prove the money he accepted), and the ridiculously smoking gun email in which he declares that he "just doesn't feel like working on your pool any more." There's really nothing he can come up with to justify the abandonment. Unless the judge turns out to be his cousin or something, she's going to see right through any lies he might offer (and he will, but don't fret about that). He signed a contract, he took the money and he bailed. It's pretty open and shut.
I have found that construction contractors, while they may or may not be skilled in their trade, tend to be pretty dopey when it comes to business and legal matters. In all of the cases I have won (I'm 4 and 0) the defendants inadvertently handed me everything I needed to win, just as your guy has (the unprofessional contract and that even-less-professional email).
You don't have to worry about winning the case. It tries itself. You only have to worry about how you're going to get some of that money back: how much, whether he has the means to pay, and whether he's going to or not. You're going to win a judgement, no doubt. Collecting is an entirely different matter (I collected 100% on two cases, only part on a third, and got stiffed on the fourth). Again, your attorney will strategize all that with you. But if he's still in business, and is not declaring bankruptcy, there is at least a path.
- the bit about him using his sprinkler guys for labor... there's probably nothing there. I can't imagine that being an issue, one way or another. Maybe if they were undocumented, but so what?
- and the notion that it matters that he said this or that about walking away, or agreeing to finish if he started the gunite, that's also here nor there.
You're probably over-thinking all of this. Relax. I recognize that in you because I am the same way. It's nerve racking, for sure, and we tend to get carried away with the minutia, instead of seeing the big picture.
You and he entered into a contract (in writing) to build a pool. He didn't finish it. The end. Your documentation will, indeed, help with your credibility, sure, but the proof of the matter is the glaring unfinished pool in your backyard, the date on the contract, the cancelled checks (I'm assuming you can prove the money he accepted), and the ridiculously smoking gun email in which he declares that he "just doesn't feel like working on your pool any more." There's really nothing he can come up with to justify the abandonment. Unless the judge turns out to be his cousin or something, she's going to see right through any lies he might offer (and he will, but don't fret about that). He signed a contract, he took the money and he bailed. It's pretty open and shut.
I have found that construction contractors, while they may or may not be skilled in their trade, tend to be pretty dopey when it comes to business and legal matters. In all of the cases I have won (I'm 4 and 0) the defendants inadvertently handed me everything I needed to win, just as your guy has (the unprofessional contract and that even-less-professional email).
You don't have to worry about winning the case. It tries itself. You only have to worry about how you're going to get some of that money back: how much, whether he has the means to pay, and whether he's going to or not. You're going to win a judgement, no doubt. Collecting is an entirely different matter (I collected 100% on two cases, only part on a third, and got stiffed on the fourth). Again, your attorney will strategize all that with you. But if he's still in business, and is not declaring bankruptcy, there is at least a path.
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- Nov 12, 2017
- 12,710
- Pool Size
- 12300
- Surface
- Plaster
- Chlorine
- Salt Water Generator
- SWG Type
- Pentair Intellichlor IC-40
@sll0037, I wanted to introduce this possibility to you. Something to think about.
I won one of my cases via negotiation and involving the Contractors State License Board (CSLB). The other three I won in CA Small Claims Court (SCC). I never used an attorney for any of the cases, and so have never paid any attorney fees.
In the two construction-related cases, I first engaged a contractor to estimate the repairs required. I then used that amount in my demand letters, and later in my SCC trials. The amount I sought in each case was below the SCC threshold, so I was able to get in front of a judge without all the hassle and expense of an attorney.
FYI, if we can trust google, TX has a SCC, with a limit of $20,000. If you were to get a bid or two on the remaining work, and the cost to complete the pool was within $20K of what the original contractor was going to charge you to complete it, you might consider SCC. When you add in the cost of an attorney, you might be way better off in SCC. On the off chance you lose, or get a judgement but cannot collect, at least your total loss would not include attorney's fees, which could be substantial.
Even if there is more than a $20K difference, you have to calculate the attorney's fees to see if it's really worth going that route. You may or may not be able to recoup those fees in you win, so that's a bit of a wild card. Some scenarios:
(1)
Original Bid: $137,000
You've paid: $68,500
Balance to finish pool: $68,500
If you can get a contractor to finish the pool for $68,500, then you don't have to sue. You'd only be losing attorney's fees if you tried to. In fact, you probably can't sue, because there are no real damages. Pain and suffering, or loss of use, or punitive damages could be claimed, but those are very hard to get. You'd be better off finishing the pool and moving on.
(2)
But say the new contractor wants $88,500 to finish the pool. That's $20K more than you were supposed to pay. Now you've got a case, but one that could be tried in SCC. No attorney's fees. Less hassle. Faster judgement. Etc. In CA, if you win a judgement, you can take that to the CSLB, and they will suspend a contractor's license if he doesn't pay. That put's him out of business, so is a real incentive for him to pay up. Something to check on in TX.
(3)
Now lets say the new contractor wants $100,000 to finish the pool. That's $31K more than you were supposed to pay. So that's more than you can sue for in SCC, by $11K. But if you use an attorney instead of SCC, is he going to charge you more or less than $11K for his services? If more, you'd be better off suing for $20K in SCC, and just eating the $11K loss.
So what I'm getting at, is to consider SCC as a real possibility if the numbers work out (and even if they are only close to working out). Because once attorneys are involved, they're usually the only ones that actually "win" anything!
You might consult an attorney about all this first. Or you might first start getting bids to finish the pool, and then consult an attorney. Or you might get the bids and just finish the pool, suing in SCC only if it's warranted (or worth it to you).
Just some alternate paths for you to explore...
I won one of my cases via negotiation and involving the Contractors State License Board (CSLB). The other three I won in CA Small Claims Court (SCC). I never used an attorney for any of the cases, and so have never paid any attorney fees.
In the two construction-related cases, I first engaged a contractor to estimate the repairs required. I then used that amount in my demand letters, and later in my SCC trials. The amount I sought in each case was below the SCC threshold, so I was able to get in front of a judge without all the hassle and expense of an attorney.
FYI, if we can trust google, TX has a SCC, with a limit of $20,000. If you were to get a bid or two on the remaining work, and the cost to complete the pool was within $20K of what the original contractor was going to charge you to complete it, you might consider SCC. When you add in the cost of an attorney, you might be way better off in SCC. On the off chance you lose, or get a judgement but cannot collect, at least your total loss would not include attorney's fees, which could be substantial.
Even if there is more than a $20K difference, you have to calculate the attorney's fees to see if it's really worth going that route. You may or may not be able to recoup those fees in you win, so that's a bit of a wild card. Some scenarios:
(1)
Original Bid: $137,000
You've paid: $68,500
Balance to finish pool: $68,500
If you can get a contractor to finish the pool for $68,500, then you don't have to sue. You'd only be losing attorney's fees if you tried to. In fact, you probably can't sue, because there are no real damages. Pain and suffering, or loss of use, or punitive damages could be claimed, but those are very hard to get. You'd be better off finishing the pool and moving on.
(2)
But say the new contractor wants $88,500 to finish the pool. That's $20K more than you were supposed to pay. Now you've got a case, but one that could be tried in SCC. No attorney's fees. Less hassle. Faster judgement. Etc. In CA, if you win a judgement, you can take that to the CSLB, and they will suspend a contractor's license if he doesn't pay. That put's him out of business, so is a real incentive for him to pay up. Something to check on in TX.
(3)
Now lets say the new contractor wants $100,000 to finish the pool. That's $31K more than you were supposed to pay. So that's more than you can sue for in SCC, by $11K. But if you use an attorney instead of SCC, is he going to charge you more or less than $11K for his services? If more, you'd be better off suing for $20K in SCC, and just eating the $11K loss.
So what I'm getting at, is to consider SCC as a real possibility if the numbers work out (and even if they are only close to working out). Because once attorneys are involved, they're usually the only ones that actually "win" anything!
You might consult an attorney about all this first. Or you might first start getting bids to finish the pool, and then consult an attorney. Or you might get the bids and just finish the pool, suing in SCC only if it's warranted (or worth it to you).
Just some alternate paths for you to explore...