Construction Law - Kent Carnell

Sly- Joining us now from Lawton and Cates is Kent Carnell. Construction law. Everybody’s hiring their contractors; as a matter of fact I was just talking about one of our contractors on a commercial. Everybody is hiring people to do home remodeling or having insurance work done with roofing that sort of thing. There is law that applies specifically to this, isn’t there?

Kent- Well there is general law that applies specifically to construction problems. The basic is contract. What is your contract or what is your agreement?

Sly- Is that one of the first things you get in a law school, contract law?

Kent- That is one of the first year courses, yes.

Sly- That’s what I thought. That first year is hell isn’t it?

Kent- It is. There’s a movie about that from many years ago that’s very real.

Sly- Contract law can’t be as fascinating as like criminal law but you must have to deal with it more frequently than some of the things that you see on a TV show.

Kent- I get lots of calls from people that are having problems with their home. Either a new home or remodeled home and something has gone wrong. And that’s when you have to know what your legal rights are.

Sly- Is there anything really called “boiler plate contract?” Or is that kind of an overused cliché?

Kent- It’s an overused cliché. There are lots of clauses that you want to have in certain contracts. In very big construction projects there are very big, very specific contracts that are used, but for homeowners it’s very minimal.

Sly- Alright. You’re going to have someone put an addition on your home or build you a home or remodel your basement. At what point do you have a lawyer look at the contract the contractor puts in front of you?

Kent- Most people probably don’t do it at all. It is smart, before you sign the contract, to have a lawyer look at it so you know what’s in it and you know what your rights are. But probably the important thing is for any homeowner to understand what they’re getting in it. Not just, I will build you a room for X number of dollars. What’s the quality of the windows, what’s the quality of the cabinets, what’s the quality of plumbing fixtures for instance in the bathroom? Those kinds of things have to be in the written agreement. Sometimes I see agreements that are just very sparse and have nothing in them. And then people say well why is this so bad? It’s because you didn’t specify it.

Sly- What about the longevity about how long the work is supposed to last?

Kent- Typically that’s in contracts especially if you’re building a new home. You’re talking about how long it takes to build it. In terms of how long a warranty is, typically on a new home there is a warranty for about a year. If a particular product like a water heater has a longer warranty, then you go by the manufacturer’s warranty.

Sly- What about allowances? We’re talking about cabinets.

Kent- Allowances something people have to know about. An allowance is an item in a contract that says for instance $5,000 for your kitchen cabinetry; you have to know how much you can get for that. Oftentimes people may go with a certain contractor because the contract is lower because he puts his allowances lower. Then you go to pick out your kitchen cabinets and you find out that they’re going to cost $10,000 instead of $5,000 in your allowance. You’re going to have to pay $5,000 more than your contract. So that’s what I talked about earlier, you want to know what’s specified, what are you getting in your contract for the money that you’re paying?

Sly- Kent Carnell with us. He’s from Lawton and Cates. What’s your phone number at Lawton and Cates?

Kent-282-6200

Sly- So it’s not a bad idea to have an attorney look at an agreement that you signed to have remodeling or an addition or having a house built. But the other important thing is to know your rights in case something goes wrong.

Kent- That’s probably more important and those would be more of the calls that I get is when something has gone wrong.

Sly- What’s the most common call you get on construction law?

Kent- Something has gone wrong. Something doesn’t work right.

Sly- Give me an example.

Kent- The kitchen cabinets aren’t put in correctly, they aren’t the quality that I expected. The plumbing doesn’t work correctly. I’m having water problems on the outside. Water’s leaking into the house.

Sly- I can see that one happening. With the kitchen cabinets and the quality, can’t that all be specified? What type of cabinets they’re going to use and how much they’re going to cost, can’t that all be specified at the very beginning of the contract?

Kent- It’s best to specify very precisely. Often that isn’t done. It’s very general and people don’t understand when they’re getting into it, the need for that specification.

Sly- Is it tough to sue a builder?

Kent- It’s not tough to bring a lawsuit. The hardest part is that many times hiring a lawyer and getting through the lawsuit is not economically justified by what you’re trying to get.

Sly- And contractors know that?

Kent- Contractors know that. If you want to sue a contractor for five or ten thousands dollars, it’s very difficult to come out ahead doing that unless you can get under the home improvement practices act if it’s a remodel. This allows you to get twice your damages plus your attorneys’ fees. If it’s a newer construction and there is some misrepresentation, a certain statute allows you to get attorneys’ fees.

Sly- Can you collect damages if they’re habitually late and the project is delayed through their malfeasants?

Kent- It’s very difficult because usually there aren’t penalties for lateness unless there are specifics in the contract. Usually you won’t see one of those except in huge projects.

Sly- I imagine this is a common dispute- if the work is not done to your satisfaction, and you don’t give them their final payment, they can end up suing you. Have you had to protect people that are standing on their own legal grounds not to make the final payment?

Kent- Sure. I do it both ways; I represent contractors or homeowners.

Sly- But have you ever represented a homeowner who is being sued by the contractor because they didn’t make their final payment because the work was not done to their satisfaction? And there is a dispute on whether the work has been done properly.

Kent- Yeah. You defend them on that basis. A contractor may file a lean against the property which gives them certain priorities in collecting and essentially they can try to foreclose on that property to try and collect their payments.

Sly- Alright in the final minute here, if a contractor does not have a lean, does he still have the right to get paid?

Kent- Yes. One you have your contract rights and the contract says that you have a right to get paid. Two even if your contract isn’t good, you have a right to get paid for the value of the work that you put in the home. In other words the homeowner can’t have you put work in and not pay for it. And you look at what the value of that work is.

Sly- Kent Carnell from Lawton and Cates, what’s your phone number one more time?

Kent- 282-6200

Sly- Alright. Have a lawyer look at your contracts, especially if you’re doing something substantial. Have him or her look at it. It’s good for you and it’s not bad for the contractor either.