A contractor is hired to perform certain work for you, but when a contractor does not fulfill their responsibilities, you may have a case for fraud, defective work, or breach of contract. Of course, there are many reasons for a home owner to sue a contractor. An important detail for pursuing a lawsuit against a contractor is having a written contract.
Moreover, should someone be injured by the poor construction work in the home, the home owner can bring a personal injury case against the contractor. Also, always be aware of something called the statute of limitations. Basically, if you wait too long to sue a contractor, you may not be allowed to do so. In Pennsylvania, the time limit varies. For breach of contract, a homeowner has four years to file, but for property damage, only two years are allowed for filing. Be sure to check if your lawsuit is within the right time frame.
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Top 3 Claims against Contractors
Out of the many reasons that a home owner might file a lawsuit against a contractor, three specific claims dominate. Most lawsuits are filed for one of the following reasons. When it comes to lawsuits against building contractors, it’s important to work with building experts and a knowledgeable lawyer for gathering evidence.
Defective construction work
Breach of contract
Defective Construction Work
Discovering that a project was not completed correctly is frustrating and expensive. Before filing a lawsuit, you must prove that the work is defective, whether obviously or subtly. This demands hiring experts separate from your original contractors to investigate and analyze the contracted work. Once proven, check the contract for whether or not the contractor agreed to a warranty of their work. Many consider it good practice to allow the original contractor a window of time to correct the work. Due to the complexity of defective work claims with the need for experts and proving incomplete work, you may want to hire a lawyer to help manage the details.
Breach of Contract
These days, most everyone understands the importance of having a written contract for any type of work where a large amount of money will be exchanged for work. Should the contracted relationship deteriorate, the contract will become one of the witnesses to show how a legal claim should be settled. The types of claims that are housed under the category of breach of contract are many, including owner delay, subsequent purchasers, and tort. When determining where your claim falls, it might be necessary to consult a lawyer.
This type of breach of contract is simple. A contractor who is under contract to create a project by a certain date must finish that project before the deadline. If not, the contractor may forfeit payment. In situations where the contractor’s delay of finishing a project further delays client events such as a grand opening or selling plans, the contractor may be liable for damages as well.
Alexander, the main contractor on a business renovation, hired a subcontractor to handle the plumbing of the building. In a written contract, they defined the project expectations and specifics as well as a specific date for the work to be completed. The subcontractor finished the plumbing one day late. According to the contract, he would not get paid.
The individual who purchases the building or home after the original owner, also known as the subsequent purchaser, does not usually benefit from the original construction contract. Therefore, if a problem is found with the building, the subsequent purchaser cannot bring a claim against the contractor or likely wouldn’t have the same standing as the original purchaser. But, a subsequent purchaser may be able to bring a claim against the original purchaser or builder if certain deficiencies weren’t disclosed.
Lila purchased an almost-new home. Three months after moving in, she discovered a crack in the basement floor. She hired a contractor to examine her foundation and the contractor reported that it was compromised. She wants to file a lawsuit, but she was the subsequent purchaser.
Although not specifically considered a breach of contract claim, tort often comes alongside the claim of breach of contract. Basically, someone with a tort claim is trying to prove that the contract issue arose due to negligence. To prove a tort claim, four things must be confirmed.
1. The contractor had a responsibility to buyer 2. That responsibility was not fulfilled 3. The contractor caused the failure of not fulfilling the responsibility 4. Failure to fulfill the responsibility requires damages from the contractor to the buyer
Any time that a contractor intentionally misrepresents information to a buyer, this is considered fraud. For example, if a home is marketed as being quality made but it’s been constructed over a mine, this would fall into the category of fraud. A number of situations can be fraud such as falsifying payment paperwork, subcontractor collusion, and many other cases.
Falsifying Payment Paperwork
More than half of the construction fraud situations stem from false pay applications. Basically, a project manager or accountant alters payment paperwork in order to charge more, funneling that money to a false company or buying personal items. Some common ways that this can happen is with a false list of totals, fake invoices, or inflated rates. There are so many ways that fraud can occur in payments so it’s important to examine payment applications closely.
Sometimes subcontractors band together to bid rig and price fix. Therefore, it’s important to find reliable and experienced subcontractors. Bid rotation, bribes, and inflated change orders are also considered types of fraud in subcontractor collusion.
Failure to update the accounts as changes and progress are made can be the perfect cover for fraud. This means that a manager or accountant might apply fake bills against the buyout savings amount and no one will notice because the account has not been updated. Subcontractors can also use a variation of this type of fraud by up-charging on materials.
Substituting, Removing, Diverting, Stealing
Contractors sometimes replace high quality materials with lower quality materials or they might remove the material for personal use. In some cases, the payment is meant to be a lump-sum, but the contractor charges for time and material cost rather than accepting the lump-sum. Double check that orders of supplies and tools are shipped to your job site and not taken for the contractor’s personal use.
Sue My Building Contractor
To pursue a lawsuit against a building contractor for defective work, breach of contract, or fraud, it’s important to work with a legal professional to build a case for your claim. Since this type of claim requires expert evidence, a lawyer will best know what type of claim to file in your situation. Take these steps to fight for your rights under the law and recover your damages.
1. Know your claim
When seeking to regain certain damages, you need to know what you’re going to file for with the court. But, it’s also important that you know what you want to receive from this. If you believe you have a claim but aren’t sure, consult a lawyer.
2. Speak with the contractor
Before filing a claim, approach the contractor and share your concerns. In some cases, the contractor will be quick to rectify the situation or offer a resolution. The resolution could be a refund or completing the project.
3. Check state law
When working with a lawyer, your lawyer can guide your approach to what’s the best agency to submit your claim to. Not all state agencies are the same so it’s important to choose the right one for your claim.
4. Collect documents and photographs
While working with a contractor, it’s important to keep record of the relationship with paperwork and photographs of the progress. The written contract, emails, and extra agreements will serve as evidence when you bring a claim against the contractor.
5. File your complaint
On the surface, a complaint is simple, but it’s also the foundation for pursuing the damages that you’ve experienced from your experience with a bad contractor. Therefore, it’s important that your complaint is thorough and detailed.
Do I Need a Lawyer to Sue a Contractor?
Dealing with a lawsuit against a contractor will require in-depth understanding of the law and managing a thorough investigation of the evidence. To improve your chances of gaining your desired outcome, a lawyer is a crucial part of how to sue a building contractor. A lawyer guides you through the filing process, negotiation, and resolution.
If you have experienced contractor fraud, contact an attorney now to hear your legal options.