Bad things happen in the construction industry when the
economy gets rocky. Work is scarce, and it’s hard to
get paid. I can’t help you with the work part
— but I can tell you how to get paid.
Let’s assume you’re about to send off that
60-day, 90-day, or 120-day invoice, and you decide you
don’t want to keep sending bills to this customer.
It’s a waste of time. But what’s the
alternative? Mediation? Arbitration? Or should you just sue the
Arbitration and Mediation
Arbitration is the best choice when the dispute is the result
of a misunderstanding — about the terms of the
contract, for example. Does “paint-ready”
refer to drywall or primer? What does
“completion” mean? That the last worker is
finished? That there’s been a walk-through? That the
occupancy permit has been issued?
A big advantage to arbitration is that you can find
arbitrators who understand what these things mean. This is very
different from litigating: You can’t count on the
judge knowing anything about construction.
Mediation usually works best when the problem revolves around
a more global dispute, or a personality conflict. It’s
not that the parties don’t understand each other;
it’s that they don’t agree on the best way to
But what if the real problem is that the guy simply
won’t pay? Deciding exactly what is going on with the
customer is a gut call on your part. Payment disputes often
appear to be misunderstandings when they’re actually
Perhaps the customer is saying that you
didn’t do the job as directed, that the work
isn’t what was promised, or that it isn’t
good enough. But in reality, he may just want to renegotiate
the price after the fact. He talked to his friends and
neighbors and discovered that they got a better deal than he
I’m not talking about the person who really
can’t pay, whether because of a layoff or an illness
or some other overwhelming setback. I’m talking about
the person who can pay but won’t. When this is the
case, your best bet is probably small-claims court.
Almost every jurisdiction in the country has something on the
order of a small-claims court, where — if the debt is
small enough — you can sue and represent yourself. You
won’t have to hire an attorney, pay expert witnesses,
or start a lawsuit that can drag on for years. And
you’ll get a decision much faster than you would if
you litigated, mediated, or arbitrated.
So how small is small enough for small-claims court? The
qualifying amount could be as much as $10,000 or as little as
$500. It depends on where you live. Call your county clerk and
Filing a complaint. If you decide to
take this route, you will have to pay a small filing fee and
complete a form to describe the work you did, who you did it
for, and how much the homeowner owes you. The court will set a
trial date and notify the plaintiff that he needs to
What to bring. When you go into
court, take your records with you — every single piece
of paper that relates to the job. That includes copies of the
contract, the estimate, invoices for materials, and bills you
have sent. You should also bring the notes from your phone
conversations with the customer.
If it was a small job and you didn’t bother with a
written contract, don’t despair. Not every contract
has to be in writing — and most courts make it
difficult for the property owner to raise this issue as a
defense after the work is done.
Also, bring pictures. This is where that digital camera will
be worth its weight in gold. Bring photos that show the job
site before you started work and after you finished. (And if
you didn’t take those pictures, start doing so
Finally, don’t forget your license. Some
jurisdictions require you to be licensed before you can win a
judgment against a nonpaying client.
What to do in court. The most
important thing to remember is that you can do this. You
don’t have to be Perry Mason — this
isn’t that kind of court. You already have the skills
you need: You know your business, and you know what you did
when you were on the job site. To help yourself relax, picture
the judge as someone like an inspector or another customer, and
then just tell him or her what happened.
If you win. If the judge finds in
your favor, you’ll still have to collect from the
customer — which is the problem that brought you to
small-claims court in the first place. But once you’ve
won, the legal system can help you collect. You may be able to
garnish the customer’s wages or attach his property or
bank account. The court clerk can explain how to do this.
Quenda Behler Story has practiced and
taught law for more than 25 years.