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superfly t.n.t.

... and in this corner ...

So I just got to do one of the parts of my job that I really don't like much.

I had to call the owner of a property that we did work on to see if he was going to pay for the work that the contractor didn't pay us for. As you can probably imagine, when you tell someone that they have to pay a couple of thousand dollars 2x and that they have to sue the contractor to get their money back, they are unlikely to be thrilled.

According to TX property law, a sub-contractor's (in this case, us) only recourse when they don't get paid on a job is to file a mechanic's/materialman's lien on the property where the work was done. If you're working on new construction this is a significant bargaining chip since any liens on the property will tie things up quite nicely and they will usually get resolved within a few months (yeah, legal crap isn't particularly swift even when you're right and it's a standard thing). Now, when you're doing work on an existing property, you still only have that same option, but since the property is "finished" a lien doesn't really matter as much. It can be a lot more difficult to get paid in that situation.

So we did a job on this guy's property back in March. We were sub-contracted to do some work and the contractor that the owner hired to handle the entire project, didn't pay us for the work that we did. Not only that, but the job came out pretty poorly for us (due to the fact that the water company made a few mistakes). That would have been bad if we had been paid. Not getting paid at all makes it that much worse. It took about two months, but I got the water company to pay us what we had asked them to pay (i.e. the extras). That's what I was kinda chipper about this weekend. It's cool to do something that people don't think you are likely to be able to pull off. Now we're just left with the original contract price (which was less than half of what was owed). I called up the owner in the (admittedly slim) hope that he might be willing to pay us what was owed. The call didn't go particularly well. I would have liked to direct some choice expletives at this guy, but I didn't because I was in uber-diplomat mode and I was trying to get money out of him.

It's funny, but over time, you start to pick up little things when dealing with stuff like this. For instance, a person sounds really really really stupid when they say "I talked to a lawyer and he said ________" when in fact ________ is really really really false and somewhat silly sounding. That tells me that either a) they're pulling legal opinions out of their ass or b) they have a fairly stupid lawyer. Neither alternative is particularly flattering for them. A person should also be careful when they threaten "You put a lien on my property? Well then I'm going to sue your ass off if you did!" and I say "Go ahead, would you like my lawyer's information?". This should indicate to them that I may have actually done some research on what was going on and maybe they might want to actually talk to a lawyer before going on.

See, the problem that this guy is going to discover is that a sub has to file a lien within a timely manner in order to protect their interests in work that was done on/for a property. If they don't and a few months go by, they are S.O.L. that's it, they lose the money. We can't sue the owner of the property. We can't sue the contractor who didn't pay us. All we can do is encumber the property with a lien and possibly foreclose on the property using the lien. Unfortunately this requires legal work and time so it's really the last resort. Now, it may sound odd to foreclose on someone's house over a couple of thousand bucks, but that's the way that liens work (at least in TX). In theory, we could end up with a house if the owner doesn't resolve a valid lien. Well technically what would probably happen is that the house would be sold, and we would be paid what we were owed, plus lawyer's fees (hopefully) and the remainder would be given to the owner.

Now, obviously, no one is likely to allow their house to be foreclosed on and sold over a couple of thousand dollars and what usually happens is that they resolve the lien issue and then they have to sue the contractor over what it cost them to go to court and what they had to pay twice for. Fun fun fun.

I suspect that we might not actually get to court over this since when the owner does check out the facts, hell see how the law is setup and he'll realize that he has to do something about it. Alternately we might have our lawyer inform the owner that we intend to foreclose on his property unless he pays us the money that we are owed. At which point some after some education he'll grudgingly pay us and attempt to go and do the legal equivalent of tearing the contractor's head off. Now that would be fun to watch since the contractor apparently got paid and told him that he had paid us (a flat out, blatant lie) and he lied to us because he said that he hadn't been paid.

Anyways, I'm proud of myself. I was able to talk to someone for about 20 minutes and not succumb to being snarky, snide, sarcastic, or obnoxious despite his repeated jabs. I was totally diplomatic and I think in the long run that will help us since I firmly place all blame for this debacle on the contractor's shoulders.

Anyways, I have to run off and do more work stuff.

ta-ta

Comments

this sounds like the cleanest stomping ever for a messy situation. congrats on progress!
Thanks!

I was pretty psyched in that, by the end of the conversation, the owner was starting to grudgingly (and accidentally) bump up against logical flaws in his arguements.
Damn, my nice medium-ish entry got eaten up by the Bad Conection-Failed Monster.

Anyway, glad to hear that things have worked out!
It's funny you should mention that. This post was almost eaten up by the same critter.

I hope you guys get your money; sometimes you gotta admire the Mafia's collection efficiency ;). But I'm a little alarmed over the legality issues. Isn't that similar to me taking my car to a mechanic ... the mechanic replaces a part ... I pay the mechanic, but he fails to pay his parts supplier ... the parts supplier puts a lien against my car???
Actually, that's exactly what can happen. However cars tend to work out differently since it can be fairly difficult to figure out which car a certain part went into. You have to know that work or material went into a specific property before you can put a lien on it.

A mechanic could put a lien on work done on a car, but they'd be better off just insisting on cash payments or investing in a check reader so they can get their money before they give you the car back. Otherwise an unscrupulous person (and there are so few around here ;) could take the car and make it "disappear" from the books.

Real estate is different since we can't hold on to it while we get paid, but by the same token, it can't go anywhere. For the most part it's only real estate and really big property (say heavy machinery) that you would seriously consider putting a lien on. Other things like cars etc... tend to require a lot more work to pursue and even then there is a fairly low probability of recouping costs.
I see your point, and if that's the law, then I would certainly exercise it. But to me, it makes more sense to go directly after the culprit -- the contractor in your case, the mechanic in my example. Why punish the innocent (property/car owner)?

Oh wait, lawyers are involved, huh? ;)