Contract Question

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bkludecke

Senior Member
Location
Big Bear Lake, CA
Occupation
Retired Electrical Contractor
I have a signed contract to wire a new custom home. The owner/builder is a real pita so I priced accordingly. I was dreading this job but I drove by the project site the other day to check on progress. Much to my suprise most of the rough wiring has been completed by someone else.

While I was delighted and relieved to not do this job (we're plenty busy), I was really kind of P.O.'d that I had to find out by driving by.

My question is (and I really don't care); what recourse am I entitled to if I were to want to enforce my legal rights under the contract (and I don't)? Am I entitled to the full contract price? The projected profit? The difference (assuming there is one) between the other conractor's price and mine?

This would be a civil lawsuit so a judge would most likely follow caselaw and may "split the baby" or might see no real damages and tell me to go home and quit whining.

I am asking this as a general interest question because it has never happened to me before and I'm curious what others think and have experienced.
 
If you have not bought any material or permitted the job, then just give the contract back and walk away.

If you have bought material, spent money mobilizing, or have a permit pulled then send a bill for just that. If he does not pay then file a lien on the project and wait till he does.
 
At least in this state Ohio contracts mean very little with out a the following
A Request for notice of commencement
A notice of commencement
A notice of furnishing
Dennis
 
If you have a signed contract, or can even prove a verbal "meeting of the minds" then you are entitled to your profit.

I would at the very least request an explanation.

Let's turn the tables just for fun. What would the owner want from you if you refused to perform the work that you signed a contract on. Probably the difference in cost between your price and the next guys price. I wouldn't let him off the hook so easily. This might be the easiest money you ever made.

Rich
 
It won't be the easiest money you ever made you need to get a lawyer and we all know how much fun that can be. I do agree you should get your profit.
 
I do have a good lawyer ($275/hr minimum), but I take pride in rarely having to call him. Or pay him.

Invoicing for the profit does sound like an interesting way to get them to talk about the matter anyway.

Thanks
 
Damages

Damages

Usually, only damages can be sought from the party breaking the contract. As pointed out earlier, your damages might be for materials you purchased and cannot be use elsewhere or for permits. In this instance, it sounds like you had no "damages."
 
This is one of the reasons I get a hefty deposit AT signing.


But to play devil's advocate for a moment...
Is you contract actually a legally binding contract?

Some States require various language that MUST be included in the contract. Failing to do so *may* render the entire contract VOID ;it may also render that portion VOID ~ but only if you have language indicating such; it might also VOID nothing.
 
Greg1707 said:
Usually, only damages can be sought from the party breaking the contract. As pointed out earlier, your damages might be for materials you purchased and cannot be use elsewhere or for permits. In this instance, it sounds like you had no "damages."
Click to expand...

Could your damages be the fact that you declined other "profitable" work in anticipation of starting this project as contracted for? Just food for thought......


Jeff
 
All good comments so far. Celtic, I have no doubt that my contract is an enforcable legal instrument (the whole point of having a contract lawyer write it).

In CA the law states that I may collect a down payment of 10% or $1000 whichever is less when contracting with the homeowner. I didn't do that here and I rarely get any money up front. I almost never have collection problems and people like the kind of trust I put in them.

I agree that it would be very hard to prove damages on a job not started when I'm already booked through November.
 
Another thought about all this is that I don't forcing a relationship with people I don't like. It's probably a good thing that a relationship with AHs like this never got the chance to cost me real $$$. Time to move on.
 
It does not appear that you have actually been damaged so it is unlikely you would collect any monetary damages.

I suggest just moving on with your life and not worrying too much about this guy. You are probably better off without him as a customer.

You might want to talk to your lawyer specifically about this kind of situation.
 
Say you did sue this GC....and you lost....would that open you up to maliscious prosecution?
 
Is it possible to just go in and start working, taking up wherever the work already done was left off, and claim it as your own? That would force the GC to take the defensive stance in an offensive manner, and attemp to somehow justify his hiring someone else.

In other words, you have a contract to wire this house, and there is wiring done in this house. Now he has to prove it's not your work. For that matter, maybe someone else started wiring at the wrong address. That could be your position anyway; you weren't officially "fired."

One of our friends got her entire house re-sided absolutely free, because the crew got the address wrong, and didn't discover it until they were more than halfway through. The only request by the boss was to put a sign in the yard, which our friend readily agreed to.
 
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celtic said:
Say you did sue this GC....and you lost....would that open you up to maliscious prosecution?
Click to expand...
Not if he genuinely believes he has a case. I do, and I would.
 
bkludecke said:
All good comments so far. Celtic, I have no doubt that my contract is an enforcable legal instrument (the whole point of having a contract lawyer write it).

In CA the law states that I may collect a down payment of 10% or $1000 whichever is less when contracting with the homeowner. I didn't do that here and I rarely get any money up front. I almost never have collection problems and people like the kind of trust I put in them.
Click to expand...

If you had a down payment, he may have given, some serious thought, to having someone else starting the job, he had nothing to loose, in most states, the contract is not binding until a payment is secured.

I would never write a contract, without a binding payment.
 
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