Contractor Breaks Verbal Agreement

Contractor Breaks Verbal Agreement

QUESTION:


We have hired a general contractor for home renovation. In the contract, we noticed the following phrase: “All work to be completed in a workmanlike manner according to standard practices.” The contract doesn’t list deadlines, but the contractor has verbally agreed to deadlines with us for different phases of the project. After giving us verbal promises about when the work will be completed, the contractor failed to finish the renovations on time. So far, he has missed four deadlines. What can we do?

ANSWER:


Year 2015

Homeowners do have recourse when a contractor breaks a home renovation agreement. When it comes to construction projects, the law agrees that meeting deadlines is important. And, when a contractor does not meet a deadline they are, in fact, in breach of contract. At the same time, the law gives the contractor a chance to fix the breach within a reasonable time frame after the missed deadline. This is known as “curing” the breach. Unless the missed deadlines have been exceeded to the point where they have harmed you or prejudiced you in some way that cannot be corrected, they’re considered curable.

One often-misunderstood issue in Massachusetts law is the idea of a “waiver.” If you don’t enforce a contract when it’s breached, you have waived your right to enforce that same provision later. If you accepted the work once it was complete the first time your contractor missed his deadline, you waived your right to claim breach of contract for the first missed deadline. Note that the contractor’s work after the missed deadline is also an example of a contractor fixing or “curing” the breach of contract.

Waiver is an instance-by-instance analysis meaning that if you waive the first construction deadline, you have only waived the first construction deadline – you still have the right to enforce later deadlines (for example, the project completion date). Although “waiver” is isolated to the specific provision(s) being waived/not enforced, I have seen Massachusetts court incorrectly treat a case of waiver as a modification of the contract.

Homeowners should notify a contractor, in writing, when they miss a deadline and inform the contractor that their failure to meet a deadline constitutes a breach of contract. Such a notice should be sent by certified mail, return receipt requested or some another method that will provide the homeowner with proof of delivery.
In such a notice letter the homeowner should state that the breach of contract must be cured by a specific date — if it isn’t, the homeowner will terminate the contract. The good thing about sending this type of letter is the homeowner will have proof of its objection to the breach, which is proof that the homeowner did not waive its right to claim breach of contract.

If there’s a dispute and you decide to stop working with the contractor, payment and liens may become an issue. Under Massachusetts law, contractors can put a lien on your house or property to make sure they can get paid for their materials and labor costs. If you decide to stop working with a contractor, the contractor may try to prove in court that you owe him or her money. Again, having letters where you outline the contractor’s breach of contract can help you prove that the contractor breached the agreement and thus, is not entitled to a lien or other compensation.

Since property and contractor laws can be complex, it’s a good idea to consult with an experienced construction attorney. Calabrese Law Associates handles a broad scope of matters involving of real estate and construction law, including breach of contract claims. Our goal is to offer industry-leading legal representation for a reasonable fee. To receive detailed and honest advice about your specific situation, contact Calabrese Law Associates at any time for a consultation.

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