Studio City Attorney, Joann Deutch • (818) 753-9922
Practical Legal Pointers
Is the Honeymoon With Your Contractor Over?
By: Joann Deutch, Attorney
You don’t wake up one morning and decide you can’t put up with your contractor anymore. It kinda creeps up on you. You come home from work and can’t decide if you’re more irritated with your Contractor who actually showed up, but appears to have accomplished nothing; or are you more relieved that he didn’t show up at all? And thereby didn’t mess anything up?
What to do? Rest assured that your contractor knows that if you boot him off the job, it’ll cost you more to finish the job with a new crew. Tends to make him a little cocky.
So let’s get to the Practical Legal Pointers. You should always have enough reserves [money held back from the Contractor] so that if you are not satisfied with the work you can fire the Contractor. It is commonplace to make several payments to the contractor over time, based upon what’s been accomplished. Most legit Contractors will let you withhold 10% of the price of the job until everything is done to your satisfaction - any yes there will be plenty of haggling over what’s reasonable in the “your satisfaction” department. Try to get a bid that spells out the price for demolition; the price for ordering materials, say cabinets, toilets, door or windows, etc. This will help you figure out what your periodic payments should look like. They don’t need to be even.
For the Contactor the demo part is cheap. He hires 3 guys at $180 per guy per day, for what 4-5 days? The dumpster is $250? The rest is pocket change for him. The 1/3 up front is pure malarkey. The Contractor is far from done with 1/3 of the job when he rips down your walls.
When you get to the “buying of materials” be sure to make that check out to your Contractor AND the supplier. You don’t want to learn that the Contactor has used your money for something other than your supplies. Be sure your address is on the materials order, so that things are in your name – not your Contractor’s. Yes the supplier can and will sue you even though you gave the Contactor the money for the materials.
As the guys who did the demo finish the job [and all the other “trades” that come in] get them to sign a Full Release which says they’ve been paid. Contractors are notorious for not paying their crew on time. I’d add a note on the release that the workers are “not claiming they were injured on the job” It’s a rare Contractor that carries Worker’s Comp insurance these days, and you can bet your bepee that the worker will be looking to you and your homeowner’s insurance for compensation. Technically they can’t waive Worker’s Comp rights, but it helps your side of you get into a squabble with them later.
The form should look something like this:
UNCONDITIONAL WAIVER AND RELEASE ON FINAL PAYMENT
The undersigned has been paid in full for all labor, services, equipment, and/or material furnished to _________________ [customer] on the job of _________________ [name of owner] located at _________________ [job description] and does hereby waive and release any right to a mechanic's lien, stop notice, any claims for labor and/or materials, or any right against a labor and material bond on the job.
NOTICE: THIS DOCUMENT WAIVES RIGHTS UNCONDITIONALLY AND STATES THAT YOU HAVE BEEN PAID FOR GIVING UP THOSE RIGHTS. THIS DOCUMENT IS ENFORCEABLE AGAINST YOU IF YOU SIGN IT, EVEN IF YOU HAVE NOT BEEN PAID.
Date: _________________. _________________ [ name]
By _________________ [signature]
Copyright ©2010, Joann Deutch. All rights Reserved
Hope that you don’t need this advice.
Good luck!
With Law Offices convenient to Studio City, Sherman Oaks, Valley Village, Van Nuys, North Hollywood and Universal City
(818) 753-9922
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