This is in California.
We signed a contract with a contractor who claimed "licensed and bonded" for a backyard job. During the project, contractor asked us to pay directly for the cost for concrete, and we did.
Contractor finished work generally well, and we made final payment. But We forgot to deduct the material cost we already paid directly for the concrete expense.
Now we are asking the contractor to return the excess payment, but he initially agreed, and then refused to make the payment saying that "I'm losing money on this project".
We then did some research and it turns out this company only has a business license in the City, not a valid CSLB license.
So what should we do ? File complain/claim with BBB, CSLB, police, or small claim court?
Under California Law, it is a misdemeanor to contract for home improvement and not have a license to do so. Further under CA law, you are entitled to recover ALL money paid, even if you knew he was not licensed. Finally, this is the case if the contractor was not fully and properly licensed at ALL stages of contracting (contract formation through completion.)
That being said, you CAN sue in Small Claims for a maximum of $10,000.00. If the contract was for less than this, Small Claims is your best avenue. If more, then you should hire an attorney and go to superior court. If you have been damaged in any way (aside from having no warranty) then you can get EVEN more money under a different statute.
In either case, you need to make a decision on how to proceed. As I see it, chances are that this contractor has violated at least 5 different statutes and you SHOULD be able to recover all monies paid to him.
Additionally, you can file a complaint with the CSLB. If you want, you CAN file a complaint with the City Attorney. If you do either or both, DO NOT advise the contractor that this is what you are doing (it COULD be construed as extortion; a felony.)
If you have additional questions, contact an attorney that knows about Small Claims. Try: www.smallclaimsappeals.com
Adam Jaffe Law Office of Adam Jay Jaffe 124 Lomas Santa Fe Dr, #204 Solana Beach, CA 92075 (619) 810-7964 www.smallclaimsappeals.com Adam@SmallClaimsAppeals.com This posting is provided for “information purposes” only and should not be relied upon as "legal advice". Nothing transmitted from this posting constitutes the establishment of an attorney-client relationship. Applicability of the legal principles discussed here may differ substantially in individual situations or in different states.
First go to small claims. Will have court day in 30 to 45 days. The process requires to first ask him in writing to give the money back. Make the letter certified to have proof for the court. Second file CSLB.
Report to BBB. Etc
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Construction / Development Lawyer
Follow Mr. Jaffe's advice. Go to small claims, demand the full $10,000 allowed. The contractor was not licensed and therefore is required to give you back every penny you paid him. You do not need to send a certified demand letter. But doing so will only strengthen your case.
Contact the CSLB, the City Attorney and/or the District Attorney to report this guy. One or all of those agencies might be willing to take some action.