Disagreements with contractors can be frustrating and costly. If you have a contractor who failed to meet the agreed-upon deadline or didn’t bother showing up for the past few weeks, you’re not alone. Many businesses and homeowners find themselves in this situation. The good news is that there are ways to resolve these disputes without going to court. This blog post will discuss how a real estate lawyer can help you resolve contractor disputes quickly and efficiently.
Real Estate Lawyer- Contractor Disputes And Construction Law
It’s not always easy to tell when things are going wrong with a contractor. Often, small problems can turn big if you don’t handle them quickly and effectively. If you’re having issues with a contractor, the best course of action is to end them as soon as possible.
In many cases, this means working in good faith with your general contractor to resolve the dispute with the Texas statutes in the Residential Construction Liability laws.
However, having an experienced attorney on your side is always helpful.
Working Out Contractor Issues
In most troubles involving contractors, you must work in good faith to resolve the issues. You can do this independently, but an experienced real estate attorney can help you find a quicker and more satisfying resolution.
Residential Construction Liability laws provide the framework for homeowners who have issues they need to work out with their contractor. Before bringing a claim against your contractor, you’ll need to:
- Give notice
- Ask for an inspection
- Settle claims
Using the Texas Residential Construction Liability laws, your attorney can help you work through these steps.
Texas Residential Construction Liability Laws
Under Chapter 27 of the Texas Property Code, your real estate attorney will help you work through the step-by-step process listed below. You’ll need to try to make things right with your contractor before you can legally file a claim for damages.
Steps of the Negotiation
- If construction has defects, notify your contractor in writing through certified mail and with a return receipt requested. Write your notice with reasonable details of the construction defects and your name, address, and telephone number.
- You must allow 35 days for your contractor to inspect the property and see what is wrong.
- If the contractor asks for evidence, you must provide pictures or proof of the defects.
- After inspection, you’ll need to let your contractor know what you expect to happen to fix the problem.
- Your contractor has 45 days from receiving your first notice of construction defects to make a written offer to you.
- In the offer, the contractor should detail the repairs they will do for your problem. The contractor’s proposal must include an agreement to repair or repair by hiring an independent contractor.
- You may also hire a 3rd party inspector to help your contractor see what needs to happen next.
- You have 25 days from receiving their settlement offer to accept or reject their bid.
- If you reject the offer, send a letter explaining your reasons. Your letter will let your contractor know they may need to increase their bid. The contractor can raise their offer within 10 days if you decline it.
If your contractor makes an unreasonable offer to fix the problem, you can talk with your real estate attorney about how to sue for damages.
Other Ways to Handle Contractor Problems
You can also call your city’s Permitting and Inspection Department or Chief Building Official (CBO) if you have problems with:
- Building codes based on local construction practices, new products, and new technology.
- Code amendments based on local construction practices, new products, and new technology.
- Code interpretations made by the CBO during the project’s construction.
- Inspections performed on the home during construction.
Sometimes, the city will dispatch an inspector to examine the situation and give an opinion based on local building code requirements. Your city may also have a builder registration program or a commission that addresses issues with contractors and related construction issues. (1)
Contractor Dispute Lawyer Solutions
If you and your attorney went through the steps to negotiate an amenable solution, but your contractor failed to work with you, next steps involve small claims court or suing in a civil court.
Once a real estate attorney files a suit, your contractor will have reason to step up their work ethic and resolve your problems. No contractor wants to go to court.
By filing a lawsuit and working through negotiations, your attorney can handle issues you thought were impossible. The threat of litigation will usually get a contractor moving in the right direction!
Bringing on a real estate lawyer for contractor disputes can produce the creative solutions for the outcome you need!
Reasons to File A Lawsuit Without Negotiations
You may also obtain legal representation and file suit immediately without taking step-by-step negotiations if a contractor acts in the following ways:
- Abandons an improvement project before completion.
- Retains, uses, disburses, or diverts trust funds with the intent to deprive you.
- Keeps or uses trust funds and fails to keep up with their required construction account. (Section 162.006)
- If a contractor fails to establish or maintain an account record for a construction account (Section 162.007)
- Uses or moves trust funds you paid if their affidavit contains false information about their payment of current or past due obligations. (Section 53.085)
- Intentionally, knowingly, or recklessly makes a false or misleading statement in an affidavit. (Section 53.085)
- Commits fraud in a transaction involving real estate or stock in a corporation or joint stock company. (Business and Commerce Code)
- Gives a false intentional representation of a past or existing material fact you relied on to induce you into the contract. (Business and Commerce Code)
- Gives a false intentional promise to do a material act to induce you to enter the contract, and you relied on that promise. (Business and Commerce Code)
- Causes personal injury (not emotional),
- Brings issues preventing survival or causing a wrongful death.
- Causes damage to goods in your home.
If you have contractor problems and need help, don’t hesitate to reach out to an experienced real estate attorney in your area. They can help you understand your options and work towards your best outcome.
Mechanics Lien Issues
One type of lien that is common when someone takes out a loan to build a new home is called an “Intervening” mechanic’s lien. You can end up with a lien if you or your general contractor has a dispute with a materials supplier or the subcontractor who is building your home.
If the general contractor refuses to pay the subcontractor due to the quality of the work, the subcontractor may choose not to fix the bad work. If the bad work cause water intrusion or other problems with the construction project, a time-consuming legal battle can throw construction projects into a legal quagmire!
When work stops, you may feel stressed about the time frame of the construction contract. You were likely relying on your completion date!
At this point, if the general contractor doesn’t pay the last installment of the construction loan and the subcontractor files a lien, this lien can effectively prevent you from qualifying for the loan you need to buy the newly constructed home. It can also prevent you from selling the property in the future!
According to Texas law, it is illegal to use a lien against real or personal property, knowing that the lien is fraudulent. It is also unlawful to use a lien to intentionally cause another to suffer financial injury, mental anguish, or emotional distress.
How to Remove a False Lien
If you are the victim of a fraudulent lien, you may bring an action to enjoin violation or recover damages -this means taking the lien filer to court.
Once your attorney threatens to take them to court with carefully laid out reasons why their claim is invalid or fraudulent, many lien filers will back off and remove the lien.
At that point, many contractors will work with you to ensure they perform the work correctly and fulfill the written contract.
Your Real Estate Attorney Understands the Complicated Lien Laws
The lien laws in Texas can be complex to decipher. There are extensive sites online for contractors and others that make the process easy for contractors. These lien services for contractors often miss necessary and critical legal details. This can work in your favor!
Your attorney can find the problems with hastily drawn-up mechanics lines and file the necessary paperwork to end the lien and avoid court battles.
Liens are recorded and held at the county clerk’s office. However, many liens in Texas are not actually valid. The clerk’s office does not thoroughly inspect each filed lien. Just because a contractor files a lien doesn’t mean it is valid and will hold up in a court of law.
Your real estate attorney understands the rules and statutes behind the lien process and can effectively negotiate with the lien placer.
How to Negotiate a Lien
Your attorney can tell if the lien holder knowingly filed an invalid lien. They can work to discredit the lien and demand it released by giving notice to the lienholder.
Your attorney will consider these points of Texas lien law when looking for ways to invalidate a lien:
- “Legally sufficient for identification” description of the property
- Includes the claimant and property owners, amount owed, description of unpaid work, when work was done, and sworn statement that affidavit is true and correct
- Recorded in the county where the work was performed
- Sent via certified mail, return receipt requested
- Includes correct language to file a valid statutory or constitutional lien. Texas law sets forth numerous requirements for the lien affidavit.
- Property owner is served with the lien by certified mail within 5 business days.
- Sent to you before specific dates related to the construction or remodeling process.
An “Intent to Lien” Gives You Notice
If you personally hire someone to do work for you, they are considered a general contractor.
General contractors can get a “constitutional lien,” meaning they do not have to serve you an “intent to lien” before filing the actual lien.
However, subcontractors, material suppliers, and laborers do have to serve you an “intent to lien” before filing the lien with the county clerk’s office. The type of lien they can put on your home is a “statutory” lien.
An “Intent to lien” has to be served to you and the general contractor who hired them. These notices of “intent to lien” must be “timely.” If they are not done in the timeline that the law recommends, the lien is invalid.
Texas’s laws are perplexingly intricate regarding the specific dates for the submission of notices and affidavits. An attorney specializing in real estate law will understand how to take legal action against a lien. You can read more about liens at the Texas Bar Association’s Introduction to Mechanic’s Liens
Lien Lawsuits and Timelines
If the lien holder does not file a lawsuit, they cannot force you to pay the lien. You can’t force them to relinquish the lien if you don’t file a lawsuit.
Suppose you were constructing a house or getting a remodel when the lien was filed. In that case, the lienholder must start a lawsuit before one year from the last date that they could file the lien affidavit, or else the lien becomes automatically invalid.
Constitutional loans may have longer statutes of limitations, even up to 4 years.
Suppose you want to remove a fraudulent or illegitimate lien. In that case, it’s essential that you seek out an experienced and proficient real estate lawyer familiar with these sorts of scenarios.
You need someone who can fight for your rights both in the courtroom and outside of it. Don’t go through this tedious legal battle alone – enlist professional legal help!
Our Experienced Real Estate Attorneys Can Help
Whether you’re facing a breach of contract, a licensed contractor engages in fraud, or construction contracts have you stressed to the max, we can help!
At Jarrett Law, our real estate legal team can help you with contractor disputes, home improvement construction defects, and more. We understand the legalities of your situation and can help you obtain your best outcome. We can also represent you in a binding arbitration or mediation. Contact us today to schedule a consultation!