Homeowner will not pay general contractor

Asked almost 5 years ago - Houston, TX

I repaired a home after a fire and the work is now complete. The job was over 250K which I negotiated the price with the insurance company. the home owner now owes over 100k but appears not willing to pay. The house looks awesome and I have offered to have texas residential commision perform an inspection to verify standards have been met. The homeowner is very difficult and appears to be a ploy not to pay. I have a contract but no language concerning lien information. What are my rights ? Can I lien? Any thoughts

Attorney answers (3)

  1. William J. Dyer

    Contributor Level 15

    Answered . Your rights to file and enforce a repairman's lien are mostly governed by Chapter 28 of the Texas Property Code, entitled "Prompt Payment To Contractors And Subcontractors," which I've linked below. (It also governs your obligations to any subcontractors.) It contains a series of strict deadlines and notification procedures for all concerned.

    Some contractors and repairmen file and attempt to enforce these liens on their own, with mixed results depending on their legal sophistication; and there may well be laymen's self-help guides around, perhaps available through various trade associations, that could help you with that if you want to do it yourself.

    However, if more than 30 days have already passed since you made written demand for payment, that generates (independently of Chapter 28) an obligation on the part of the debtor to pay the reasonable and necessary attorney's fees you incur in collecting on the unpaid obligation.

    What you describe sounds like a fairly straightforward payment dispute, but it's the rare homeowner who -- when faced with a lien and/or sued -- fails to find some ground to complain about the work done. You may also need legal advice and representation on general contract and collections law, in addition to law specifically relating to liens.

    Just given the amount of money involved -- and how easy it is to screw up one or more of the deadlines, which can invalidate your lien and deprive you of the strategic advantage such liens can create -- you may well want to consider getting specific advice and representation from a qualified attorney anyway. An attorney's involvement will signal your seriousness to the homeowner and permit you to pursue this debt more credibly and probably more efficiently, which is to say, a good lawyer's work should "pay for itself" and result in a larger, quicker net return to you than if you were trying to handle the collection entirely yourself.

    And of course, if he's serious about resisting, the homeowner's going to hire a lawyer, at which point you will certainly need one too. If so, better that you've had one sooner rather than later.

  2. William J. Dyer

    Contributor Level 15

    Answered . Re-reading my answer, I realize I wasn't entirely clear about one point:

    If more than 30 days have passed since you submitted your bill, then under Chapter 38 of the Texas Civil Practice & Remedies Code, the homeowner should become liable to repay you for your attorney's fees reasonably and necessarily incurred in collecting upon the debt. What I meant to emphasize was that you may thus be able to eventually shift onto the homeowner the financial burden of paying for your own lawyer -- which is another good reason to hire a lawyer rather than trying to handle this yourself.

    Who pays for whose legal fees often becomes extremely important in the settlement dynamics of these cases. If they turn into full-blown court fights, construction disputes typically get into specifics about very small, discrete matters -- "Was this door frame really straight or not?" -- the fighting about which in turn generates disproportionate legal fees, quickly matching or even exceeding the original repair costs. The risk of that happening SHOULD influence a savvy homeowner to settle for a fair sum sooner rather than later, because most of the risk of attorney's fees will be on him (if the contractor substantially performed as promised). But not all litigants are savvy or even reasonable.

    I should also mention that in any event, you will probably still have to come out of pocket to fund your lawyer's fees and expenses as an initial matter. The availability of a lien, however, like the availability of a lawsuit to enforce it and/or to otherwise collect on the debt, ought to turn that into a worthwhile investment on your part, an instance of spending money to make, net, more money. But it can definitely crimp your cash flow in the short and middle term.

  3. William J. Dyer

    Contributor Level 15

    Answered . I should also have linked Chapter 53 of the Texas Property Code for completeness.

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