Time-Sensitive: Terminating a Contractor

4 Replies

Hi all –

We've been working a flip down in San Antonio, our first one in this market, and have had a big issue with our electrical contractor. Our contracted electrician's team (of a different 20 yr old each week) has done consistently poor/incorrect work and has caused multiple delays to our project in addition to creating issues for the rest of the team working around him. Our GC (he didn't hire the electrician) estimates a total delay of 14-19 days total.  For various reasons, we've tried to press forward with him but have now hit the final straw (submitting an incomplete drawing for the meter loop to the city's energy company, delaying the completion of the job further). 

So - we are not inclined to pay him the remaining draw of 50% due upon completion of the work. We are a week and half from the date he said he would be finished and as of yesterday, he hadn't even been scheduled for the new service drop which takes 10-14 days. We compiled a rough list of all the damages and delays this guy/his team have caused, and honestly, he technically might *owe* us money. 

Our attorney wants us to go through legal channels to compile a legal termination letter and all necessary documentation to support our claim that we shouldn't pay him. We are hustling to finish the project and just told our GC to take over the remaining electric work so we can wrap this project up. We don't want the electrician back out at the property, and he's requesting his final payment by tomorrow...he's unsurprisingly more in touch now than he's ever been. 

Our question is: for those who have faced similar situations, did you take the legal route, even if it took more time and was cumbersome/expensive? Or have you tried to work it out directly with the contractor before bringing your lawyer into the equation.

Our preference might be to give the electrician two options: either take a small check and never come back to our property, or we go through our attorney to terminate. Would appreciate any experienced thoughts!

In many if not most circumstances, the ones that win legal battles are the attorneys and not the plaintiffs and defendants. With that in mind and the fact that spending negative energy and time is rarely worth biting the bullet now, it is often best to work it out direct. 

Now that you have his ear, I would let him know your specific dissatisfactions, your desire to termite from here on and to figure out a fair resolution for final payment. Since he did not complete the job in full, he is certainly not entitled to the full payment however, your contract agreement you have with him is of vital importance as that stipulates the terms. If the sub contractor failed to meet terms, you should have rights per contract to address that issue.

Bottom line, try and work it out with the contractor first, if all else fails, either eat it or go the legal route.

If this is a flip and you don't pay him, what are your plans if he puts a mechanic's lien on your property and you can't sell it until it's resolved? 

I build houses in San Antonio.  I've had the same problem.  Get the work done with your GC, subtract what you pay the GC for electrical, then pay the balance to the electrician ( if there is any balance).  At the same time, file a complaint with the licensing board for Texas, have your attorney send a cease & desist letter with a promise to sue if he doesn't comply.  Even if he puts a lien on the property, you can sell on a rent to own or lease it or find some solutions from the people on this forum.

Having said what I just said, I offer this disclaimer:  I am not an attorney; this is not legal advice.  I am just a ticked off builder who has had to deal with this before.

Thank you all for your helpful responses! Much appreciated. 

@Will Barnard - roger that. We wanted to try working it out with him first, so good to know others support that route. 

@Peter Sanchez - we're meeting with him tomorrow. We've pulled together all supporting documentation we can regarding ways in which he has delayed this project or caused damages. We're planning to meet with him, explain our situation and the proof we have of his shoddy work, and suggest he accept $XX payment, sign a change order and a conditional waiver (since we'll be paying w/ a check), and call it a day. If he doesn't want to go that route, then we'd say we'll continue this with our attorney. 

@Charles G. Johnson - we're in San Antonio a lot these days and plan to continue investing in the market. We're located in Austin and are always interested in making new connections down there. Would love to be in touch. 

Thanks again, 

Mary and Matt