Can I sue a contractor for not completing the construction of my house in the time promised? (how much, phone)
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
The contractor promised (and we signed) for the house to be built with 4-6 months. They completed over 1 year later. Since then we have paid interested on the construction loan and now after closing because the house never sold we have a 2nd mortage (ARM). If they would have completed the house as promised we would have had time to sell it and made a profit from it. Instead, we are loosing money. Can we sue this construction company for not complying with the contract? Does anyone know?
I would think so, but get advice from a construction attorney. It would be important to know what exceptions and contingencies are built into the contract. For example, my contract with our contractor allows them extra time for events beyond control, but they would have had to advise you of that and have your approval prior, as you should have had the legal choice to change contractors if they couldn't proceed. But that's MOST contracts, you'd want to reread yours carefully.
You can sue for anything, but winning, and then collecting, is something else again. The proper way to do a construction contract is to get the time estimate from the contractor, add 10% for unforeseen problems, and then write into the contract a penalty clause for the extra time it takes. A daily penalty usually keeps them right on target. A week or two of penalty will eat up all of their profits.,
Sounds like it's too late to do that in your case, so how much are you planning to sue for? $5k (perhaps more, depending on the state) or less, go to small claims court. Over that amount requires an attorney, and you may get in deeper than the end results merit.
The contractor promised (and we signed) for the house to be built with 4-6 months. They completed over 1 year later. Since then we have paid interested on the construction loan and now after closing because the house never sold we have a 2nd mortage (ARM). If they would have completed the house as promised we would have had time to sell it and made a profit from it. Instead, we are loosing money. Can we sue this construction company for not complying with the contract? Does anyone know?
Good luck getting them to come back and fix anything if you do.
Like Donn said, anyone can sue anyone for anything.
As a home inspector, I have worked many expert witness cases, but it's usually when the builder doesn't finish the job, when they screw up big time, or have some other issue related to doing something contrary to the contract.
However, reading your post again, I get this impression......
He took approximately 6 months longer than promised to finish the house.
You were planning to flip it for a profit.
The market dropped and you feel the delay ate into your anticipated profits.
Fair enough. If you have a contract that spells out a specific completion time you may have a case.
However, were there any changes made to the original plan?
Were there any extenuating circumstances that might have delayed construction? If so, a judge may look at those too. Did you raise the delay issues with the builder at the time, and document it?
Not sure I follow the logic of building a house just to sell it. Seems like you would have to sell it for more (your planned profit) that what the builder would charge for the same house down the street.
Maybe it's just me, but I think you have a pretty weak case because you are not going to make as much money as you thought you would because he took a few months longer to build.
The contractor promised (and we signed) for the house to be built with 4-6 months. They completed over 1 year later. Since then we have paid interested on the construction loan and now after closing because the house never sold we have a 2nd mortage (ARM). If they would have completed the house as promised we would have had time to sell it and made a profit from it. Instead, we are loosing money. Can we sue this construction company for not complying with the contract? Does anyone know?
Unless you can also prove beyond a doubt that you had a buyer with financing in hand ready to buy for a set amount. The loss you are claiming from less profit margin than you think you would have gotten 6 months earlier is just a guess and won't hold water even if you do have a case for delayed building.
Quote Barking Spider: Not sure I follow the logic of building a house just to sell it. Seems like you would have to sell it for more (your planned profit) that what the builder would charge for the same house down the street.
Maybe it's just me, but I think you have a pretty weak case because you are not going to make as much money as you thought you would because he took a few months longer to build.[/quote]
A lot of people who are not "builders" are becoming speculators these days. They go through a builder to do it though, because of inexperience in the field. Then, like you said, sell the home for more than the builder would sell it for, because they also want to make a profit. That is happening an awful lot here in the Pocono's. What you then have is the suppliers and contractors making a profit, the builder making a profit, the speculator making a profit & anyone else involved - i.e. real estate agents or financing companies. This causes a home that could and should be affordable to not be so, and then the home costs much, much more than it would appraise for. This very issue is part of the reason we started the business that we did, as an answer to keeping a homes value in line with their cost. But, I digress ~ back to the OP...
You still may not have been able to sell the home, this is a very tricky market. It's a buyer's market, and an overpriced home is a hard sell. So I agree that based on the fact that you feel you lost out on the best time to sell, you would have a weak case. But, the builder made a contract with you, and promised to deliver your home long before it was actually delivered. Even with delays due to weather, site conditions and contractor availability - your home should not have taken that long. Talk to a lawer about the possibility of having the builder pay the extra amount of interest you had to pay on the construction loan - because of their gross delay in finishing your project on time. Then let us all know how it's panning out.
Others in your situation can benefit from your experience. Good Luck.
Thanks for all your comments. It's obvious that I am not experienced in this field. I am taking into consideration all your advise. My first step is to get all the documents together and present it before someone that knows construction laws.
We had purchased this house with the intent of selling to make a profit. It was to have been $20K. They did complete the house just not in the time frame that had origionally been stipulated. We never wrote a letter to the contractor but we went there to speak to him in person and spoke on the phone that his delays were costing us money.
I will keep you all informed so that maybe it can benefit others in similuar situation.
Thanks for all.
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
