Tuesday, November 11, 2008

I Want to Sue my Builder/Contractor/the Homeowner

One of the interesting aspects of writing this blog is I get to see the keywords that people use to find me. My audience frequently searches the title above to land at my blog. I have posted previously ("Think Before You Sue"), but I think it is tremendously important in the current economy to re-visit this issue.

Lawsuits do not usually end well. I think the media has given us an unrealistic picture of the rare windfalls that can occur after going through a court proceeding. So many clients have told me they want "justice." I try to point out that a group of twelve strangers or a judge are not necessarily going to provide a just result. So many factors influence the behavior of the decision-makers that it is not realistic to think that one is going to achieve a storybook verdict.

At the end of a lawsuit, if the parties do not settle, one side receives a judgment. Frequently that is only the beginning. Enforcing the judgment and collecting on it is a whole other matter. Most people do not have readily accessible funds to pay a judgment. Even if they hold a valuable asset, one still has to force the sale of the asset if one hopes to collect.

So, rather than end this post on a discouraging note, I want to remind my readers of the following:

1. Start all construction projects with a good contract. This document spells out the understanding and intentions of the parties. A wonderful arbitrator I arbitrated with last week said ideally, the contract should sit on a shelf and collect dust once it has achieved its purpose.

2. Maintain good communication throughout the project. If problems arise, deal with them quickly and be honest. It is not surprising to me when I meet great contractors who tell me they have never been sued. Great contractors are usually great communicators as well.

3. Be realistic. Many of the disputes that I see occur because parties have unrealistic expectations. There are some people who simply expect perfection, and that just does not occur. When I was buying my house, my cousin said, "When you look at a house, you should keep one eye closed." I think there is a great deal of truth to that statement.

4. Try to resolve your disputes. Settlements are always better. Yes, I mean always. Statistics have shown that people tend to comply more with settlements than judgments. In addition, a settlement is something that you have control over.

After all, isn't justice when you have a say in the result?

65 Comments:

At 1:22 PM, Anonymous Dave said...

I agree with some of your comments but not all of them. I am currently in a claim against my Builder. With my structural issues with the 1st floor sub-flooring to the inadequate lumber used on the house, I'm in a real mess with seven lawyers involved now. I have a Builder who really is not a Builder and thinks he knows best and does whatever he thinks is best. I have had a building inspector inspect the house with his final report stating code & poor workmanship violations from the State of Michigan. Structural Engineer was hired and proposed several fixes to repair the sagging 1st floor sub-flooring. Builder paid for the structural engineer's inspection & report. As the current home owner we were willing & advised to let the builder come in and make the repairs. We thought the Builder was going to follow the structural engineers proposed engineered repair for the structural sub-flooring issues. Well, the Builder did not do anything that the structural engineer proposed to do and just decided to do it his way and hired a old friend who is a rough framing carpenter to perform the structural repairs which related to raise/jacking the 1st floor sub-flooring up in several areas and add additional stantions along with continuous steel plates. My frustration has peeked with the Builder now. The Builder is not willing to make the structural repairs correctly to meet residential codes & laws. Please say a prayer for me. Any comments?

 
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At 12:46 AM, Anonymous Anonymous said...

We signed a new building contract to build a "turn key" modular house when we bought the land from our contractor. We paid one third of the contract price upfront before the modular house set at the end of May. For two months, we paid averagely $25,000 per week to hurry up the progress. The work abruptly came to a stop when we paid everything except the agreed retention amount $30,000. It became apparent that our contractor was in financial difficulties. In order to obtain the CO, we reluctantly used up the $30,000 retention to pay off unfinished work and some sub-contracts. Now, we have paid out every cent of the contract price but 1)our house hasn't passed the final inspections for the CO, 2)there are still rather big sub-contract to finish the house such as the asphalt,paving, landscape and internal decoration, and 3)unpaid subcontractors. We have not been able to contact our contractor who has closed his office. We have talked to a lawyer who charged us a hefty $1,350 for the information above; on the other hand,we simply cannot afford any more money on the house, let alone paying his consultation. Anyone out there can provide us advice?

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At 2:59 PM, Anonymous Anonymous said...

I have a different situation. My friend who has a business of Home Improvment/Construction, took a contract where the contractor did not pay for anything. My friend spent all his money to do the work when the work was almost done the contractor told him that if the inspection is not approved he will cancel the contract. The inspection was done on 6/28/10 (yesterday). Today, he went to work and the contractor called him and told him that he is terminated the contract and sent someone else to finish the work while he did not give him a penny. Police came he has to leave. What do you think, shouldn't he sue the contractor?

 
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At 12:05 AM, Blogger Hong said...

You should find a good attorney and bring a suit.

I am suffering a builder who built a single car garage smaller than that standard size...My lexus GS430 won't fit in it. After we closed the escrow and they intalled the remote control, we got a chance to test it and found out it. I believe that they did intentionally. So, I guess that we have to find a good attorney. Any one knows a good one? (This's happened in Yorba Linda, CA)

Thanks

 
At 1:08 AM, Blogger XP said...

We recently purchased a newly constructed home. One of the features the home was suppose to have was the Taexx system (in wall pest control) which is usually added when the home is being built. Anyhow, this was overlooked and wasn't included in our home. This is unfortunate because it's such an awesome system to have had, especially in Florida. The builder says that it's too late to install it now. Basically they are telling us "too bad, you're out of luck". Is this something that we can sue for? Do we hire an attorney or is this something we can file ourselves in small claims? Any suggestions would be greatly appreciated!

 
At 11:33 AM, Anonymous Anonymous said...

My builder started oct 20, 2010 on a Pole barn house. Said he would be done in 8 weeks, his week must include a lot more days because he is still not finished. Told him i want hardwood he says he thought i meant laminte and only quote the floor in the contract at 2.50 a square foot. now he is just prolonging the building by only (having someone)show up once a week. It to the point if he says it we know it is not true. I will be there tomorrow means i will be there next month. We are now 5 months over due. of course we where not smart enough to have are contract looked at my a lawyer and did not get a finish date in writing. Do i have ground to sue since they are only showing up every once in a while instead of actually working on it?

 
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