I have a customer who we did a job for and he is now refusing to pay. I had sent him a contract. Any suggestions?

I have a customer who we did a job for and he is now refusing to pay. I had sent him a contract which he signed and sent our deposit to us. We performed the work and I forwarded him the required paperwork so he could do his financing. In a reply email he stated "wow that was fast and much appreciated I will get the balance payment right out to you". After not hearing from him for a couple of weeks I emailed him, called him with no replies at all. I then sent a notice of intent to lien which got his attention. His reply "really, to begin with your contract was not in the correct format and you failed to send me a letter of RECESSION. yes RECESSION.he ended with I am contacting the contractors board and we will let them decide if I need to pay. I am curious if my  contract was not correct why did you sign it, also why did you tell me you would get the final payment right out.. Any thoughts????? By the way my gut was telling me not to send him his paperwork until he paid the balance but 20/20 in the rear..
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Answers (1-10)

Mechanics lien, and depending on the amount, you might be able to use a small claims court. A thought for next time might be progress payments and stopping work if the customer does not make them.

Business from East Hampton, NY
Answered on Nov 5th, 2018

How much does he owe you?

Keep in mind there are two issues to consider for me. One is there any value to collecting a deposit on any work? And second do I realize that at some point I will be taken and end up working for free and need to write of some loss.  And there are also lawyers who may work on contingency if it is worth it. There are always some rotten apples in your group of customers. Never believe because people have agreed and signed a contact you will get paid or paid in a timely manner. 

Business from East Hampton, NY
Answered on Nov 6th, 2018

Mechanic’s lien and small claims court

Ray,

Although I am not in the construction field, I would think that any type of a contract between two consenting parties is a binding contract. I ask for the customer's signature on the proposal that is given to them. I consider that my legal binding contract. I also ask for everything up front, less the labor. So, if I am getting stiffed, at least the material is covered. If Small Claims is available to you in your state, you can start proceedings [you do not need an attorney]. I hope this helps


You should continue to negotiate with your client.  In meantime to protect your right, you should consider to proceed with the construction lien and inform the client of your attention.  Just remember that you have limited time to put an lien (45 days after the last day you be on site) and talk to lawyer.

firstly, we as contractors are coined as used car salesman, so it is imperative to make sure there is nothing that they can use against you.  If you have the proof that he sent what you said he did in an email or text, that will help you.  And you can also file a lien regardless.  The burden of proof is on them. Also, he allowed you to start and finish the work, so he's pretty much done there. Make sure you have general terms on your contract regarding your right to lien the home, if you need mine just pm me at kyle@triplehcontracting.  Regarding the rescission.  He is right, but he allowed you to start on his home, sounds like he's a pro and a dick as well.  By law you must have on your contract your home improvement license # and a 3 day rescission notifying a homeowner that they have until midnight on the 3rd business day to cancel this contract (in writing by certified mail with your address).  But that won't matter as you need to get paid for your services, you may be given a fine for not having that stuff on your contract.  I would contact your local consumer affairs office as every state is different regarding contract language.  Hope that helps!!

Contact a collection agency and let them chase your money.