Can I Withhold Payment From A Contractor?
In some instances, you can withhold payment from a contractor, and it depends on the facts of the contract and the facts of the particular case. If a contractor has been partially paid and there’s still work to be done, most contracts will provide for a retainer such that 10% of the remaining contract balance will not be paid until the contractor completes their punch list or entire scope of work. If you withhold payment from a contractor without justification or adequate reason, you could expose yourself to liability under a mechanic’s lien, a quantum merit theory of liability, or a straight breach of contract claim.
How Much Money Is Owed For A Scope Of Work? Can I Ask My Contractor For Delays?
In some situations, you may be able to ask your contractor for a delay, but many contracts provide steps of notice negotiation and even arbitration before a lawsuit is filed. Construction litigation is an expensive proposition, and sophisticated players in the construction industry will write into their contracts provisions providing for negotiation mediation, arbitration, or some other alternative dispute resolution method to try and avoid construction litigation lawsuits. There is always a question of fact that turns on an interpretation of both the contract and the facts on the ground. An owner may have a different perspective on responsibility than a general contractor, a subcontractor, or a sub subcontractor. The party responsible for a scope of work should be something that is clearly discerned in the contract.
However, once the contract is in effect, and people are doing their work, changes occur. Workers come and go, subcontractors come and go, and work either gets finished or does not. Problems that arise during the construction can lead to confusion as to who is responsible for construction defect, but determining responsibility for a particular construction defect is almost always the point of a construction litigation case.
What If The Contractor Doesn’t Pay His Sub-Contractor? Is That My Problem?
If the contractor does not pay his subcontractor, and you are the owner of the building, you will most likely be responsible for payment. Texas has a fairly complex mechanics lean legal scheme. Subcontractors have the right to file mechanics leans to ensure that they get paid, and Texas has the laws that provide that. If you work on a building or improvement on real estate, then you are entitled to be paid. If there are controversies, issues about the quality of work, or timeliness of the completion, then those things can get worked out. Many times, the owner cannot be held up from paying a contractor or subcontractor. But, that happens in many situations, and it leads to many construction litigation cases.
How Do I Know If I Need An Attorney For My Construction Related Claim?
If you’re a large company trying to get a commercial building constructed, you need an attorney at the front end because it’s too complex of a contractual situation to manage by yourself. Most of the players in the construction industry are aware that a high net worth person, as soon as they get involved in a multi-million-dollar construction project, they should have an attorney involved. From an individual or smaller net worth person’s perspective, they’re going to typically rely on whoever they engage to build their project.
However, as soon as you reach a situation where you’re not getting performance from a contract contractor, an architect, or a subcontractor, and you can’t work it out by simple negotiation, then you’re going to need an attorney to come in and help you. Sometimes, however, it could be too late because there’s a timetable for mechanics leans. Many times, when my clients are subcontractors, and they don’t have their liens filed on time, their remedies under the Texas mechanics lien statute does not really help them.
Can A Contractor Charge Me More Than The Quote?
A contractor, in most situations, can charge you more than what was stated on the quote if their scope of work has expanded beyond the quote. Typically, a quote is done at the front end of a project when the entire scope is still subject to change. Many times, homeowners want something constructed, and they will get a quote to get that done. But as the project progresses, situations occur. A lot of times, in foundation, framing, or even roofing when changes have to be made, change orders come through the system, and that results in more money being spent by the owner or the architect. Change orders are usually handled by a strict process at large construction companies, and everybody understands that a quote or an estimate is just a front-end estimate, and it doesn’t always reflect the final price paid for the completed project.
For more information on Withholding Payment To A Contractor In Texas, a consultation is your next best step. Get the information and legal answers you are seeking by calling (713) 714-0073 today.
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