Crazy Contractor and now threats daily

21 Replies

I unfortunately hired a contractor for a house I just started rehabbing and he sounded really good! He came in with all sorts of experience ace telling me how great his work is. The project started and from day one he started to boss around my electrician Abe my roofing guy. That obviously upset them and had to talk to him about that. Long story short after a week I had to tell him to not come back to job site until we were ready for him. He started putting up drywall before my electrician was even close to being done as whole house needed to be brought up to code. He would state let your electrician cut my drywall where needed. So I told him to leave. He got very upset and took all his tools and has decided not to come back. Which was fine by me. He has since started sending emails and numerous texts that he wants 6K for work completed. The whole contract was for 14k and he has done maybe 1/5th of the job. He is now threatening me with mechanics lien on this current house and other property that is currently for sale because he did work there which was paid for in full but wants more money as well for a drill he claims was stolen from the property. I also had to pay electrician extra for all the work he had to do extra because he went around and cut wires that were not supposed to be cut. I have no problem paying him what work he has done but not almost half when he has done very little. I am just wondering the process of a mechanics lien? We unfortunately never got to the point of writing up a contract just exchanging e-mails for scope of work agreed upon ace verbal agreement on price. I don't know what to do from here? I have told him numerous times I don't communicate thru text or e-mails. When he wants to sit down with my husband and I to agree on the numbers we can do that. I receive no phone calls just daily threats of mechanics liens. Any one that can provide advice would be greatly appreciated.

Wow what a mess. There are many rehabbers on here but look up Will Barnard and Jason Scott as some that deal with this a lot and might have insight.

From what you have said you had a verbal agreement and not a signed contract on scope of work to be performed which is a mistake. Sounds like also the contractor is unclear in their role as they are acting like a GC from what you posted instructing other trades on how to do things. At this point you might have to get a neutral third party to unwind this thing as it sounds like both sides could have handled things differently.

@Rachel Stopka Hello Rachel,

Just so I understand, there was no contract put in place at all? How did he know when the start work and the agreed upon price? Do you have any documentation in writing. Keep all emails and text messages and seek legal counsel. Did you check him out with the BBB and other investors? Did you look at least 3 - 5 references? Did you ask for pictures of his past jobs? Did you get 2 other contractors prices to compare with?

@ Christopher No written contact was in place. He was very eager to begin so I trusted him since I didn't get a written contract on the previous house but scope of work was much less. That went smoothly so I just assumed and trusted. No references done before and he talked about all the houses he built, showed pictures of all work previously done. So many lessons learned here. Yes I will keep all emails and texts. I don't like things ending this way but he won't talk in person. Just expects me to hand over a bunch of money. I have called my lawyer and he said we have to wait until we receive something from him in writing. I have been documenting everything abbr taking pictures. Thanks for the replies.

You should try and resolve it in a hurry you sure don't want to get something in the mail and it is a lien on your property. Next time get advice before you do anything.

Joe Gore

You need to speak to an attorney. A mechanics lien is not the end of the world, particularly if it's a "fraudulent" or unwarranted lien, as there are penalties for that. Some guys use the threat of a lien as a club. In most states, you can "bond off" the lien, by posting a cash bond with the county/city. Tell him you're not scared of the lien, let him know you know the penalties to him for filing a false lien(after you learn them).

Check your state laws. In Ohio, if everything is as you state they are - he cannot put a mechanics lien on the house.

@Wayne Brooks

Wayne I don't think its the city or county issue.. Its a title insurance issue.

cities and counties in my experience do not get involved with civil matters.

He should file a complaint with the contractors board though and or threaten that.

sounds like a small claims matter.. NOt sure what the amount is in CHC but here is 7500.00 so many of these issue get resolved that way.

Oregon were we are at liens are serious stuff as they are senior to all debt including construction loans etc etc. As long as they were properly perfected. and even if they aren't then contractors can sue for unjust enrichment and cloud title.

If it was me I would pay the dude the 6k make sure you have clear title and be done with it.. to small of amount of money to hire an attorney over.

@Jay Hinrichs

The reason the county is involved, here anyway, is that any lien is recorded in the clerk records, just like a mortgage. In order to remove that lien, by posting a cash bond, the money has to be deposited in the county court registry. Therefore I assume the procedure varies by county/state. I worked many years as a contractor/sub contractor and liens for private projects are an important tool. But, many shyster contractors use the "I'll lien your property" as a form of extortion to collect money they're not necessarily due. These types of guys need to be dealt with properly, and swiftly.

I don't know the laws in your state, but here in CA, a contractor can not file a mechanics lien without meeting certain requirements. Check with your attorney before doing anything. I also recommend that you do not have phone conversations with the contractor, rather, put everything in writing, but ONLY After you consult with your attorney on a response.

Clearly the learning lesson here for you and all reading is to NEVER hire a contractor without a written contract outlining all specs of the job, pricing, payment schedule, late penalties, etc.

@Wayne Brooks

Yes different in your neck of the woods.. We can not post a bond to remove a lien.. It can only be removed from country records by satisfaction or court order..

Now in some instances' you can have your title company hold 200% of the lien in escrow and they will write around the lien and give you a title policy but those are few and far between and pretty hard to do. The average Joe is not going to get a title insurer to do this.

I stand by my statement that this is far to little of money to go blowing thousands on attornies... the guy wants 6k he did part of the work so your probably arguing over 3k ... chalk it up to experience

then follow Will's advice moving forward.

I'm not an attorney and I don't know the laws in your state. I also think I'm probably less risk averse than most people when it comes to things like this...I don't mind risking a lien or a pissed off contractor.

That said, this is how I'd proceed (though I'm not saying it's how you should proceed):

1. First, I'd considered consulting an attorney, depending on how strong of a case I thought I had and how much/little I felt like dealing with the contractor.

2. Second, I'd find out what the lien laws are in your state. In Georgia, for example, the contractor only has 90 days from the last date he did work to file for a lien. So, in Georgia, I'd try to drag the argument with the contractor out 90 days in hopes that you pass that magic number and then he has absolutely no recourse other than a civil or small claims suit.

3. At some point, I'd decide how much I was willing to pay for the work completed. This would be based on what I'd be comfortable defending in front of a judge. From there, I would send a letter (certified mail) to the contractor laying out my case for what was agreed to, what was completed and what I thought was reasonable compensation. The letter would also state the reasons the contractor was fired and the issues he caused on the job. Write this letter as if a judge will read it, as that may be the case. Tell the contractor to contact you if he'd like to accept that offer and be done with it.

4. If, after the letter was sent, the contractor keeps harrassing you, I'd let him know that you feel threatened and that if he keeps harrassing you, you will contact the police. Also let him know that if he doesn't want to accept your reasonable offer, he is free to file the mechanics lien. Also let him know that you'll be counter-suing for filing a false lien and harrassment.

5. If he does file a lien, that's when I'd certainly get the advice of an attorney. In the meantime, you should be able to bond around the lien if you want to sell the house.

@J Scott

He should check with a title company before he thinks that he can bond around the Lien.... I have a lot of experience with this issue in my HML world and most title co. will not do this unless your a Premier client with very deep pockets... No reason for them to take on the liability for a one off deal.. But maybe they will do it... However as I stated I would sure check before to make sure they will... Because once the lien is there its there and the only way to take them off is court order or satisfaction.. And court order will be far more than this case is worth in the first place.... A real attorney would never take this on he would suggest that you settle it... as his fee's would exceed the amount they are arguing over.... At least in my humble opinion :))

OK off to work... I just bought 16 ocean view lots on the Oregon coast and am meeting my Architect today.. probably the last bank owned deal I will get until we have the next bank melt down... We are all out of bank owned stuff here in Oregon

A mechanic's liens starts out as notice of a court case and then has to be perfected and turned into a judgement by the courts. My experience says that flakey contractors that don't finish jobs don't usually have the follow through skills (or the money) necessary to perfect a mechanic's lien. Especially for small sums. Mechanic's liens are more complicated than just filing a piece of paper.

Is the contractor licensed? Here in CA, anyone can threaten a mechanic's lien and file the lis pendens. But only licensed contractors can actually perfect the lien and get a judgment. So some unlicensed contractors will threaten and file a lis pendens, knowing full well they will never get a judgment. They believe that this will scare the owner into paying. Until you know how mechanic's liens work in your area, don't be one of those owners that scares so easily.

@Rachel Stopka

This is all great advice, Two key things to get from this is.

1) Find out what your states mechanics lien are.

2) Always put it in writing.

Its call Contracting for a reason.

Most small contractors like to threaten lien but are unsure of how to even file one properly. In California we Pre-Lien every time we start a project.

We always inform the home owners that is not a Lien or even a attempted to Lien, but that its only to follow the letter of the law and be able to protect all parties involved which in most cases includes the Material Vendors.

You'll be fine.

Live and Learn.

Cheers

Originally posted by @Jay Hinrichs :

OK off to work... I just bought 16 ocean view lots on the Oregon coast and am meeting my Architect today.. probably the last bank owned deal I will get until we have the next bank melt down... We are all out of bank owned stuff here in Oregon

Sounds great Jay. We spent time on the Oregon coast last summer. It's a great place to be.

Kristine Marie Poe

K Marie best point of the thread... Contractors MUST be licensed to file a lien... its that way in Oregon and WA and I bet in most states.. this is why unlicensed contractors risk not getting paid and really have no standing to get paid.. And believe me their are those in the contracting bizz that know and understand that and will burn a non licensed contractor. IE won't pay for work performed.. Now I am not advocating that as some of these dudes will the just go back to the property and rip out what they put in :)

IN our state you must do a Pre lien notice and file your lien in 90 days just like was mentioned above.. then record it. But the main issue is that a properly perfected lien in our state is superior to any other encumbrance's except for Ad valorum tax's... Its one reason Oregon is a great place to be a sub... If your licensed and follow the lien rules you will get paid 100% of the time. either by the owner or by the bank if there is indeed any bank debt on the property.

in CT, a contractor must be licensed to do any work worth more than $200. All jobs taken by a contractor require a contract. If something as simple as the start or end date of the job is missing, the contract cannot be enforced. If you were in CT, you could actually sue him and his license ( if he is licensed) could be suspended for not writing up a contract.

So as others have said, learn your state laws about mechanics lien but also learn the laws for GCs and home improvement contractors.

You will have to pay for the job he did. The question is how much? That number should be somewhere between what you think is right and what the contractor think you owe him.

@Rachel Stopka

Is the property located in the City of Chicago or burbs

The city has independent license requirements for remodeling contractors

If you decide to bond around it you need to find a insurance company willing to write the bond and the price of the bond will be 3 times the amount of the lien and they will check your personal credit.

Joe Gore

@Rachel Stopka

WOW,

What I mess. Sorry to hear this.

I had similar issues in the past and there is a saying if you get a stick and start poking a piece of s...

It will only smell more lollol

I would pay him out and get on with making more money on future deals.

Your post proves that business is easy, its the people that make it difficult.

Thanks for reading and have a great day.

Thank you so much to all for the great advice and responses!! The work done was on Indiana. Where can I start to look for the correct information on mechanics lien in our state? He is not a licensed contractor in our state. He claims to be one in Illinois.I did pull permits for the work to be done but that was done thru my other contractor who is doing my roof, windows, and siding. But when he filed the permit he included the work to be done by this guy and also thought he was someone who could do the work. Many lessons learned here definitely and I will continue to learn thru this process especially with great people and all the support from this great forum. What is the best way to learn about mechanics liens in this state where the work was performed? I Google the topic and there are so many different articles and opinions it gets confusing. Any advice and what sort of attorney should I contact? I really wish this guy would just come to a real agreement on work done so I could pay him and have him out of my life but not going to happen as he continues with his threats even today thru text. Stating that I refused to write the contact?? Who is the contractor? Thanks again for all the time you have taken time to listen and respond.

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