I hope all is well! Long story short, my brother and I tried our hand at a flip, he is in commercial real estate, and we thought we could use that knowledge in residential. To some degree it was helpful, like for instance in creating contracts. However, our GC who is very bad at keep track of financials starting randomly asking for money without making any progress. At first we would create change orders and pay him to keep the project moving along. However, we looked at our agreed amount and confirmed with him how much we owed him to this point in the project, the next time he asked for money. He said we owed him 89K, he said to date we paid him 80K and he needs the other 9K ASAP. Well, we looked at our bank statements and we paid him 110K to date.
Our GC lost his mind when we presented this evidence and the signed contract to him. Now he is threatening us and our families. He freaked out, made a bunch of what he calls "overages" and said if we do not pay him his money he will get it out of us one way or another.
Also, the original way we found him was through Thumbtack. My wife and I found out we were expecting our next child and we wanted to turn our car port into a master bedroom. We wanted to put this project on hold until the flip was complete. Well, our GC texted me saying "I need $9,410 to buy the material for your house right now or the price will go up", I said "what are you talking about, what does this buy?" He said "Oh sorry man I just bought it I need that money ASAP, if I do not get it I will have to stop working on your flip" I asked for an invoice, he promised he would get it to me, it has been two months and I have seen nothing.
Can anyone point me in the right direction for this? Not only is it getting scary for my family and I, but we have lost all of our money in this. I spoke to one lawyer and he said "you would pay me 29K before you ever saw it from this GC if you pursue it."
Is there any hope we could protect ourselves from this guy and maybe even get our money back?
Thank you for any responses!!
Fire the GC today. If you have evidence that you have paid him, then you should have no problems in court. Never be afraid of idle threats when you are in the right. If he wants to file a lawsuit, tell him to go ahead, but don't spend $10K on an attorney to avoid paying $9K to the guy.
Thank you for the reply Anthony. So, we have fired him. Now he is being aggressive and sending out threats towards us. He has mentioned knowing where we live, he mentioned using his gun on me, etc...
We have all of the evidence that we have paid him. How do we avoid paying an attorney tons of money? So far, it sounds like if we take him to court we would have to pay more than we could win back? Our Decatur flip he owes us around 20K, and for my personal home he owes us about 9K.
I am also thinking I want to get a restraining order. I have three kids under 5, and I travel a lot. He knows that this is an easy way to scare me.
I would contact the police about his threats. I would not hire an attorney unless he files suit against you. I would not take him to court, just cut ties and get the project finished.
In GA only one party has to know the conversation is being recorded. Record the threats, call the sheriff, get a restraining order.
Is he actually licensed? If he’s not licensed, GA courts won’t even hear any case he might want to make. If he is licensed file a complaint against him with GASOS/PLB.
I have questions about how well the contract was worded, and why it was based on anything other than payment at completion of phases (framing, roof, electrical, plumbing etc.) It sounds like you didn’t manage this well either by allowing any variation from the contract, but again guessing on my part. It does not justify the GC but any means though.
Sorry your are having to dealing with this
Thank you for the advice. My brother in law handled the contract, he is a commercial real estate project manager and this GC agreed to the overall cost of the project, and because of our time constraint we decided that was sufficient. That was a mistake, and poorly managed by us. Then we created a new contract with line items and had him agree in writing to what we owed him to date, line by line. This is when he realized that we had paid him over what he said we owed him. I agree that we could have been more concise with the line items, but should he not be aware of what we owe him or really any of his financials? Or how much he needs to finish a project. I think we have enough texts to file for harassment. As long as my family is safe I am okay losing the money, because it was my foolishness that lost it.