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What happens if a general contractor refuses to pay you?

On Behalf of | Sep 30, 2022 | Construction Litigation |

Whether you work as an electrician, tile setter, mason or any other type of subcontractor, you appreciate the good relationships you have with general contractors. After all, GCs deal with clients and their concerns, leaving you free to do your job. Some GCs are slow to pay, though.

Once you have substantially completed work on a job, you should receive payment. This is especially true if the client and inspector are happy with the work you have done. If the GC refuses to pay you, you may wonder whether you are simply out of luck.

Requesting payment

As you know, GCs can be extremely busy. Therefore, before exploring your legal options for securing payment, you may need to remind the GC to cut you a check. If your verbal requests do not do the trick, it is advisable to send a formal demand letter.

Filing a mechanic’s lien

Your contract may allow you to file a mechanic’s lien against the property. Indeed, according to Construction Dive, these liens have become increasingly common in the past couple of years. Still, you may not have long after completing your part of the project to file a mechanic’s lien, so you should pay close attention to filing deadlines.

Using the payment bond

Payments bonds are bonds some GCs obtain to ensure subcontractors receive prompt payment. If your GC has one, you may be able to file a claim against the bond.

Exploring a lawsuit

If all else fails, you may have little choice but to take legal action against the GC or the client. Nevertheless, because lawsuits can be expensive, doing so may not be a cost-effective way to resolve your payment dispute.

Ultimately, regardless of how you intend to pursue payment from the GC, having comprehensive records is likely to improve your chances of receiving the financial compensation you deserve.