Contractor takes money and refuses to complete the job?

Recently on our legal forum a user asked, “I hired a contractor to complete work on my house. I paid him half of the money upfront, but he failed to complete the work. Does this constitute a breach of contract, and if so, what can I do to get my money back?”

What is a contract?

Homeowners may enter into legally binding contracts with businesses, other individuals, or independent contractors. To be a legally binding contract the agreement does not have to be filled with legalese and it may not even need to be in writing but it must contain certain elements.

First, all parties must agree to the offer made and the offer must be accepted by both parties. Next, something of value must be exchanged for something else of value.

For example, if a contractor agreed to perform a service –something of value- then you must also pledge something of value for that promise- cash, exchange of goods, or another service.

Finally, some agreements must be in writing to be valid; others do not. The laws may vary by state, but real estate transactions or those for a high dollar amount commonly have to be in writing to be valid.

Did you have a contract?

Let’s take a closer look at your question. Let’s assume that you and your contractor discussed what you needed done in your house. For example, you may have told the contractor that you wanted your bathroom retiled, the tub replaced, and the walls painted. The contractor told you he would do the work for $1,000. To further solidify the deal he took half of the payment and he started working on the project.

Now, half way through the job contractor decides that he does not want to complete the work and simply fails to return to the job site. You have a problem. Now the bathroom is torn up, you are out $500 and you still have to find someone else to complete the job.

But does your situation constitute a contract? As mentioned above, you and the contractor must agree to the terms of the offer, which you did. Next, you and the contractor must exchange something of value, which you did- he promised to perform the work and you agreed to pay him for his services.

What can you do to get the money you are owed?

Obviously, the first step to resolving this situation is contacting the contractor and finding out why he is refusing to come and finish the work. If he’s refusing to return to the job site, however, he also may refuse to talk to you.

If you cannot get a hold of him the next step may be for you to consider filing a civil case in small claims court. Rules regarding the process to file a claim vary by state, but many states will let you file claims which involve payments of $10,000 or less.

The good news is filing a claim in small claims court is simple, quick and can be done without a lawyer.

How long do I have to wait to sue?

Although you will want to give the contractor ample time to finish the job, it’s important to understand that all states have a statute of limitations for filing any type of breach of contract suit. In fact, if you wait too long you will lose your right to recover damages.

Bottom Line:

From the details you provided it sounds like you and the contractor had a valid contract. You need to contact him, which could include sending a demand letter for completion of services, and if he refuses to talk to you, consider filing a claim in small claims court.