What to do if a contractor refuses to finish the job because he wants payment in full first?

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What to do if a contractor refuses to finish the job because he wants payment in full first?

I’m opening retail shop and have been working with a licensed contractor. To date, he’s 5 months behind and we’re only a few steps from final Health, Fire and Building inspections. However, he refuses to complete the job because he wants us to pay the contract in full, which goes against terms of our agreement. We objected so he walked off the job; we followed with termination letter. He came back the next day and said that we would have to do a new agreement due to the termination of the old agreement. We met, agreed to new terms and drew up an agreement but now we are again back to square one because he wants us to indemnify him of all liability. We will not do this. What can we do to protect ourselves?

Asked on November 26, 2013 under Real Estate Law, California

Answers:

MD, Member, California Bar / FreeAdvice Contributing Attorney

Answered 7 years ago | Contributor

You will need to find someone new to finish and then sue the contractor for any additional monies it has cost you. Otherwise, you inform him in writing that he will be sued for breach of contract and will be responsible for additional monies you need to pay to someone else to complete the job. Indicate a breach of contract will be taken seriously by the court and can cause him to pay you damages based on what you can prove (out of pocket expenses, lateness in starting the business and the like). If that doesn't work with him, get someone new and sue the contractor. Not much in way of options other than these two.


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