Your attorney and your lender have no helpful advice for you?

It sounds as if you had as much picking an attorney as you did with a GC. Find a new attorney and a new GC first thing Monday.

Are you using a bank? They should have experience with this. Do you have a contract with the builder? What does the attorney say about the builder being in breach of contract? Any chance the builder will agree to terminate the agreement? My argument to him would be that terminating the agreement and allowing you to move forward with someone else will help reduce damages. Under your state law you may be able to terminate the agreement with notice to him, etc.

Please get an attorney that specializes in construction litigation. You can call your bar association for a reference, or look one up on martindale.com.

"We filed a complaint with the registar..."
I have no idea what that means. Must be something particular to your state.

How do we find an honest GC? And what about the defective work left by the previous GC?

sue36. Thank you for responding. The registar is AZ state Registar of Contractors or ROC. They have a $50K recovery fund on every licensed contractor. There are two complaintents asking for that fund. It's first come, first served. Our Atty is a construction litagator with 30 years background. The GC voided our contract for not finishing the job. Because of cost, we have been trying to get the GC to at least correct his defective work. The work order from ROC will instruct him to do so once he gets it. The GC expects us to pay him to correct his faulty work, apparently. We know that the GC is also being sued by another unsatisfied client for over $250K. The GC has no equity in his home, so I don't know where he'll get the funds to do anything! This GC is going to loose his license for the 2nd time this year. He'll probably go bankrupt leaving all us unsatisfied customers holding the bag. Is it really worthwhile to presue this GC with more Attys costs to us?

What is your bank saying in all this? And are you now obligated to have him correct his defective work? I'd be real uncomfortable, under the circumstances, for him to be back on my property at all.

A lot of factors here. If you've got all the information you're gonna get, then make a list of your choices, the cost of each one (all the costs--$, time, ulcers). Pick the least awful of them.

What a mess.

Our bank told us to hire a new GC. And we do intend to do that, we are just waiting on ROC now. Yes, it is a BIG MESS. We are just hoping to find some satisfaction on all this. It seems like there is nothing to do but count our losses and go on. It is very frustrating.

The story in movie U-571 is fictional, as far as I know. But it superbly illustrates the creative use of whatever resources are at hand when things seem impossible. Apply your resources as best you can and move forward.

How far along are you? Do you think you could finish the project yourself, maybe even use the subs the GC was using (if you were happy with them)? What are the defects? Are we talking structural issues or something more benign (and correctable) like a bad tile job? Personally, I wouldn't use him to correct defective work that he created. Some states pretty much force people to allow the GC to correct his own mistakes. If your state doesn't, I would look elsewhere.

From the sounds of it there will be little to get from the GC. You can't get blood from a stone. You have to determine what it will take to get your house finished that you can afford. How did the GC walk with 40k of your loan? Did the bank release money without inspections or before work was done? The bank may be willing to negotiate with you on interest/fees/points if they are partially to blame (this is why I always tell people that only they should control the funds, their signature only and not the GCs, and funds should be release after work is done only).

I would also run searches for other property he might own that you can attach. Builders often own lots. He might own equipment (back hoe, excavator, etc.).

Time is money. I assume you are paying interest everyday this just sits. Talk to your lawyer, but I think you need to more forward NOW and not wait. The law varies by state, but you may not be required to give him the chance to correct his mistakes but still keep intact the ability to go after him for the costs to correct those mistakes. Ask your attorney what the quickest avenue is for you, and take it.

Good luck.

In which country you are. If you are in US call 911 and if you are in UK call 999. The police will gonna help you. They helped me too alot here in UK. They'll listen you and they'll help you alot.

In the US, the police are more worried about violent crime, and would not appreciate a 911 call, which is only for emergencies. Nice to know that in the UK, things are different!

Your project has sat at a dead stop for 9 months, and they are just now starting to tell you about the crook GC? Did you wait 9 months to file a complaint or look into this? Sorry for your sad situation... 9 months is a long time to allow an "employee" to not show up.

Best wishes. I hope this turns out okay for you.

hi everyone! thanks for all your responses. It's a long story, but I'll try to be brief. For 3 months we tried to get the GC to the bank. They had 2 meetings set up w/him, which he didn't show up for. Finally, he agreed to go to the bank w/us. After that meeting he needed to submit to the bank a cost breakdown, because he claimed he needed $89K to finish the job. The bank also wanted to see a list of where all the $$ was spent. So we asked for a copy as well. As it turned out the lists had some red flags in them, so for the next 3 months we had a meeting every week trying to get him to produce factual figures, as the first list was bogus. He said he paid the painters $5k. We knew he hadn't, because we did all the painting and paid for all the supplies out of our own pockets and he never reimbursed us! Not one dime! Asked us if we could just consider it sweat equity, so we agreed. Anyway, he did give us copies of the purchase orders for all the trades, so we called them up and found out the real amounts he had paid them. There were 3 vendors, aside from us, that he neglected to pay, which on his list he claimed he did pay. A lot of the vendors on his list had added amounts that they never got. Guess who pocketed that? Yep, the GC! All in all, there was $42K unaccounted for, and each week when I'd ask for an explaination, he'd claim other items over again that I'd already accounted for! We were getting no where fast with this guy, so we hired an atty. The next few months were bogged down with Atty meetings, phone calls, letters to the GC, etc. All this to no avail. All during this construction time, which started in feb. 2006, we were having the battle of our lives with cancer. they didn't expect my DH to live six months, now it's 1 and a half years later and we've just about won that battle! So, as you can see, we were not on top of things at the construction site. the GC never even went to the construction site, unless it was to have a meeting with us! We submitted a list to ROC with 25 items in our complaint. All our exposed windows leak. Our concrete floor cracked right through the middle of our great room, in two places, and not just on the break lines! They did numerous screw ups throughout the job and refused to correct them. All the arches were done wrong, and we told them that as they were framing them up, but wouldn't do them the way the plans specified. Now, the place is all sheetrocked and painted! I could go on and on, but I'm sure you don't want to hear it all. It's just too much and we are very saddened. We should have been living there many, many months ago. We need all the final plumbing and electric before we can begin to go forward. Plus all the baths need to be tiled. I mean there's no way we could even live there if we wanted to. It's a nightmare! what else can I say? And yes, I have been running searches on him, that's how I know about his home and how much he owes on it and how there's no equity left in it. He used to own property in the area we are building in, but he sold it in 2005, that's when we first got his proposal on our home. Well, I hope I've answered everyone questions. I appreciate all your feedback and support. We really need this. Thanks again.

I hope you get somewhere with your attorney, desertcactus! All I can say is good luck, and I'm so very sorry for all of the incredible stress that you have had to endure over the last 18 months. I'm glad your husband's health is nearly back on track. Keep us posted.

Amy

It sounds like a classic case of the GC having too much control over the money (he should have been proving what was owed BEFORE he was handed funds, not after it was realized something was rotten), but it sounds like you had bigger things on your mind. I would ask your attorney if it is even worth going after the GC further. If he has nothing what are you going to get from him? You could get a judgment and then hope he has money someday. But he could file bankruptcy as well.

No matter what you do re: suing the GC, I would move on NOW. Do it yourself or get a new GC. The longer the house sits the more money you are losing on interest, bank fees, etc. Make sure all the errors are well documented by a third party in case you do decide to sue.

Wow, so sorry about the health issues. Glad everything with your husband is back on track.

My wife recently had a case like this. The GC got money for work he did not do since the bank screwed up and released money they should not have released. It took a while (a few months and a lawsuit) but the bank did give back about $40K with the interest plus an extension to get the house done with no fee.

If it's the banks fault that this GC got away with your money I would sue the bank. The GC could file bankruptcy and leave you nowhere but the bank can replenish your account - assuming it was their screw up by not inspecting the house and releasing money.

Will the bank let you GC the project? Our bank does not allow that but some banks do.

Good luck!

"there was $42K unaccounted for"

I must be doing something wrong. I'm a project manager and I loaned the owners close to $30,000 to keep the project from grinding to a halt while they got their financing in order. Consequently, I'm spending a month and half longer on site than I should have.

On the plus side, if I had done it as a fixed price contract, I might not have added in enough to make up for the $15,000 in unexpected costs. (When you start excavating, you never know exactly what's going to turn up. Or cave in.)

I feel for you.

If there are deeper pockets to go after (bank, GC's insurance), it might be worth it. But it also could be akin to tilting at windmills, especially given the litigation costs.

Definitely take sue36's advice and get on with it. Find a new GC, maybe even a structural engineer/inspector to give an informed opinion on any deficiencies. Decide what you can (and/or have to) live with.

One thing that you said that sent up a flag was that your GC had lost his license before. Hindsight, but that might've been an indicator of impending doom a long time ago. Consider yourself lucky to live in a state w/ GC licensing- GA only starts it next year.

Mostly based on my own GC horror story, I almost think it would be worth paying a lawyer a few hundred ahead of time to do a search on any litigation involving the builder before signing the contract. With bigger firms, you can pull the D&Bs as a financial indicator, but for the solo guys, it'd be good to know what their history of suing/being sued is.

In our state (Florida), you can go to the licensing department online and search for any blemishes on the builders' records. In that way, we were able to eliminate a few bad apples; one company that had been recommended to us by a neighbor had had their license pulled pending "retraining"!!!

We did a few screening measures; if you're interested, I wrote about them on our home building journal:
http://hmp2z.wordpress.com/choosing-a-builder/

Cheers!
Heather W

Here is a link that might be useful: Choosing a Builder