small claims court

[huggytree]

i have a brand new remodeler who is 25 days late on $412

im annoyed with him...he has promised to deliver it to my house last week and didnt...usually new customers pay quickly to establish a positive relationship..i had a bad feeling about him from the start...i should have said no

the prelien will be delivered to the homeowner on monday and will probably result in homeowner pressure for him to pay..it usually works in 1 day...it costs me $41 for my lien company to handle it.

in these cases my next step (in 30 days) is to call the homeowner and ask for payment directly.....only had to do it once so far....

let say the homeowner doesnt respond either....and because the dollar amount is so small that i want to do to small claims court....is it the homeowner or the contractor i take to court?

im pretty sure i can tack on interest charges and court costs too...

i have them already at 1.5% per month and i will be charging it this time.

[SteveC]

You have to take the contractor to court as your contract is with the contractor and not the home owner... for all you know the home owner has already paid in full... and of course you need to take what I have just said with a pinch of salt as I am no expert in this... and you should perhaps seek such advice from an expert.

What I would also do is look at your terms of business... perhaps you can implement things to stop this happening in the future... for example on all orders below $1,000 you require payment up front... or just for the first job of new contractors... and especially when you have that feeling... always go with the gut feeling and cover yourself.

[Evan]

You could go after either. Obviously the homeowner probably paid the general contractor, so you should try collecting from him first.

The pre-lien should certainly send a smoke signal to the homeowner. He'll probably argue with the contractor about why you (subcontractor) are sending this lien. Hopefully that's the end of the story. But if not, you could certainly go after the homeowner. You DID provide the service. The homeowner would likely then go after the contractor.

Hopefully you have a contract.

[Steve B]

You have to go over the person you have the contract with. If it is with the contractor - he would be the only person you have recourse with in my experience.

[expresslien]

The answer to your question really depends on the law in your state. In many states, even when you haven't contracted with the property owner, if you properly file a mechanic's lien, you are allowed to bring a lawsuit against the person you contracted with AND the property owner.

You will want to take a look into the lien laws of your state, contact an attorney, etc. etc.

<Please set up a signature to link back to your sites>

http://www.expresslien.com

Good luck.

[Aaron Hats]

Before you sue the homeowner think about the potential business you'd lose by doing that. I'm sure you put stickers on the hot water heater and furnace you installed. When those items need service they sure aren't going to call you after you brought them to small claims court.

Aaron

[Evan]

He would be the only person you have recourse with in my experience.

Generally this is true, but not in this case.

If I steal a car from a parking lot and sell it to you for $5,000 -- I get $5,000. If you're caught with this stolen car (let's forget about the fact that neither of us had a title, and the semantics beyond it), it is still property of the original owner. So you could be sued to get the car, even though you had "bought" it.

This is very similar, but not identical.

[huggytree]

i talked with my lien service about it today...the prelien goes out today

90&#37; chance it will be resolved asap because of it

the lien service says small claims court will be me vs the contractor..

ive been in these situations only a couple of times and have always collected. so im sure it will work out.

there were atleast 3 bad signs with this guy...as winter sets in and work tightens up i went against my instincts. i wont ask for cash up front w/ existing clients since there isnt a problem with them. asking for money up front from existing customers would be insulting.....its rarely done in plumbing...i warn homeowner against plumbers who ask for money up front...i dont get paid until i complete the job and with homeowners i dont leave the house until i have a check in my hand. i give contractors 30 days even though on average contractors are far less trustworthy people when compared with mr.average citizen...50% of contractors are crooked on some level from my experience. 75% dont know how to run a business

[huggytree]

got my check from this guy today..

i had 1 letter, 2 faxes, 4 phone calls, he said he was on his way 2x and never showed up. i did the prelien to the homeowner and that didnt get him to move...

what worked?....i called and said he was over 30 days late and i do not allow that and i will be contacting the homeowner next week unless i get a check this week....he stopped what he was doing and drove over to my house...30 minutes is all it took!

he said he wants to keep using me and that he was sorry...he says he has a poor memory....

he wants me to do more work in the future for him...i have a bid on the rest of the project and he wants me to do it...how should i handle this?

part of me says just say no thanks
part says ask for money up front and to be paid in full when i show up in the morning..

any ideas?

[Steve B]

I wouldn't do anything else for him. He's a liar. I'd have been fine if he was late, but honest about it.

[huggytree]

when he calls what would you say?

'sorry, but im too busy right now for your work'
'sorry, but i only want customers who pay ontime'

[Evan]

If you want business, I'd say accept it. Require pre-payment, or that he pay you the same day you complete work. Perhaps have him there to "verify" you installed it, money in hand.

[KristineS]

Ask for the money up front. I don't think there's anything wrong with that. If he really wants to work with you, he'll have to understand that you're a bit anxious about doing work before you get paid given his past payment issues.

[Business Attorney]

I know it's a hassle to chase after people, but ask yourself would you rather sit home without a job from him or, recognizing that he is slow-pay, do the work and have to nudge him for payment.

If you are booked are work, guys like him are the first ones to turn away. If you can use the work, it may be worth your while to take him on and be prepared to be a nudge.

As others have pointed out, requiring payment upfront may be ideal, but the fact is that many small businesses have cash flow problems right now and it may be impossible for him to pay you before he gets payments from the homeowner himself.

[Steve B]

I would tell him he lied to me in the past and I don't want to work for him. To the point, and honest. I would use the time you would spend chasing this guy down to work on your marketing efforts so you can find another customer. Or, spend more time with your family.

[huggytree]

i will not turn down his work, but i will ask for a check before i order the fixtures and a check when i show up to do the work. I will not let him owe me money again....i stress out too much...this time is was $412, next time it could be $10,000

usually with brand new builders they pay quickly to start the relationship out great..then they start paying slower and slower...i called his old plumber and was told he was a very slow payer....i can survive without his work...he's not a big time customer...just another small piece of the customer puzzle.

[phanio]

Tough with such a small amount. Might just forget about it, write it off on your books as bad debt and move on. You seem a little more emotional then I would have assumed - I know it can be frustrating. But, ask youself, is this amount worth the additional time and money that you will spend.

Then, spread the word about this person - try the better business bureau to start - may provide a bit of satisfaction with out taking a ton of time and money.

My opinion, only the lawyers win when there is a lawsuit.

[Evan]

My opinion, only the lawyers win when there is a lawsuit.

In small claims court, you'd represent yourself. The costs are nominal, and the cases are handled pretty quickly -- unlike most of the cases in the system.

If you want entertainment, you could try to get your case on a show like Judge Judy or The People's Court. These aren't real courtrooms, but rather arbitration if both sides agree to it.

[huggytree]

this customer emailed me today to start phase 2 of the project..this time its $2,000+

i emailed him a nice letter asking for $ upfront for fixtures before i order and a check when i show up to do the work...basically no credit.

he emailed back and says no because he has to work with draws which come after the work. so its alright for me to give the customer credit, but he cant give me any...he's using my money interest free to finance his project.

he told me he has alot of money...hmmm.....also he finally asked for a lien waver for the $400 he paid me.....usually people do monthly draws...obviously he does them every 3 months or more....just a bad businessman in my opinion...why would any sub wait 3 months to be paid?....ohhh how it hurts to turn down $2k during the slowest month when i know ill be sitting at home instead......but i did it.

[thx4yrtym]

The only thing worse than having no work is doing the work and then not getting paid for it. The wisdom of your decision not to do this job will become clearer and clearer as time goes by. That may sound corny but all I can say is " been there , done that" . Good for you.

regards,

Gregg

[KristineS]

I think you made the right decision. It sounds like it just would have been a hassle.