Can a businessopen an account in someone’s name without their knowledge?

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Can a businessopen an account in someone’s name without their knowledge?

Had a contractor install a new concrete driveway and his estimate and final bill included labor and materials (concrete). I paid the bill to him and he has not paid the concrete company. The concrete company has put the bill into my name and is now threatening me about filing a lien to get their money. I have provided company all the documentation showing that I paid the contractor and the cancelled check the he cashed and they will not put the bill back into his name — they say they can’t unless he authorizes it. I did not authorize them to open the account in the first place.

Asked on August 13, 2010 under Bankruptcy Law, Colorado

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

When attorneys read questions they put themselves at times in to the shoes of the both parties - the one writing the question and the one the person is writing the question about - to find a legal theory of the case that could result in a lawsuit. So here I think: under what theory of the law could the business owner sue you?  Third-party beneficiary or agency theory is what I have come up with.  But the business owner would have to sue the contractor as well.  You would have a defense: payment in full to the contractor.  But with the construction industry those "lien" issues are always the worst because often the law allows businesses or people to file the lien without the necessity of going to court and proving that the debt exists. This puts the homeowner in the position of having to start an action themselves to remove the lien. Here it is clear that you have no control over the account and that it is admitted by the store (they will not take your name off the account without the contractor's consent). Clearly it was opened improperly.  A lawyer's intervention to put the store owner on track is always the best way to go.  But you can start by writing a letter yourself requesting a copy of the authorization to open the account in your name in whatever form they have: credit card for the account, signature - whatever.  Indicate that you have spoken with them and advised that the account was not opened by you and that it was opened by the contractor and he is liable for payment.  That if they attempt to place a lien on your property you will in fact retain an attorney to clear the matter up and seek costs and fees associated therewith.  Good luck.


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