A person may sue a contractor when they suffer economic loss or harm because the contractor they hired to complete a construction project fails to deliver work that is competently done and meets the professional standards of the construction trade in their location. For example, a contractor may fail to obtain the needed building permits for a project from local municipal or county government agencies that issue these permits.
The state of Michigan offers homeowners, to whom contractors provide substandard work, two specific laws that may be of help to them. One is the law, providing that an owner’s contract with a builder who is not licensed is voidable.
Under this law, if a homeowner should discover that the builder they have hired is not licensed by the state of Michigan while at work on their project, the homeowner may immediately halt the work and cancel the contract. A local attorney in Michigan would be able to advise a person about dealing with an unlicensed contractor.
If the homeowner cancels, the builder is legally barred from suing the homeowner to recover any amount still owed by them on the contract.
If the owner has already paid the contractor, cancellation of the contract may not be a complete remedy for the homeowner. But the homeowner may sue the contractor to seek damages for the contractor’s breach of contract and may recover any sums they have paid them.
In this case, the contractor would be barred from making a counterclaim against the owner, e.g., for any money the contractor might claim they were due. The contractor would be able to defend the lawsuit but would not be able to sue the homeowner. This gives the homeowners a great advantage in their lawsuit against an unlicensed contractor.
A homeowner in Michigan might also sue a contractor for negligence for construction defects in any project the contractor may have completed for the homeowner. Construction defects are any failures in workmanship in the design of the project, materials used, or the quality of methods used in the construction project. Construction defects may affect the quality, safety, or functionality of a completed construction project.
Some examples of common defects in construction are as follows:
- Defects in Design: There may be flaws or errors in the architectural or engineering design of a project. This could lead to such problems as inadequate physical support of a structure or instability;
- Defects in Materials: Substandard or defective materials used in the construction process can result in premature deterioration, water intrusion, or other problems;
- Defects in the Construction Methods Used: Errors or poor workmanship during the construction process, including improper installation, faulty wiring, plumbing leaks, or inadequate insulation;
- Subsurface Defects: Issues related to the soil or geological conditions, such as unstable foundations or inadequate drainage, can lead to structural problems.
In Michigan, another possible cause of action that may be claimed when suing a contractor for poor workmanship would include causes of action for breach of implied warranties. Warranties of workmanship and habitability are implied by Michigan law in construction contracts and may serve as the basis for a claim of breach of implied warranty.
The remedies a person may seek include the following:
- Repair or Replacement: The responsible contractor might be ordered to correct the construction defects if that is possible;
- Monetary Damages: In cases where repairs or replacements are not possible or are not adequate, monetary damages may be awarded to compensate the injured party for the loss in value, repair costs, or other losses.
Can I Sue a Contractor Without a Contract?
If a person hires a contractor to perform construction work for them, then the person has a contract with the contractor. The contract may not be in writing, but an oral contract may be perfectly valid and legally enforceable. A contract does not have to be written to be valid. Contracts do not even have to be expressed in words or in writing. They may be implied by circumstances, although that is unlikely in the situation in which a person hires a contractor.
If a person does not have a written contract with their contractor, it is probably the case that they have an oral contract. That is because they talked about the project that the contractor was hired to complete, even though they did not express their understanding in writing.
Of course, a homeowner would be well advised to have a written contract with a construction contractor. A person should consider what terms they would want in their contract, put it in writing and have it signed by both parties. This ensures that in the event of disputes, the parties can refer to their written contract.
A good contract would specify the scope of work the contractor is to perform. Scope of work is simply the work that the contractor is supposed to do. It may also include exclusions, i.e., specific things the contractor is not going to do.
A written contract should also include the timeline for the project and of course the price that is to be paid. This contract should also include the schedule according to which payment is to be made. Another important item would be a list of materials to be used. It might specify that there are to be no substitutions of materials, if material quality is important to the customer.
Putting a contract into written form helps prevent misunderstandings and is also helpful if there is a dispute, especially one that ends up in a court of law.
How Do I Sue for Breach of Contract?
In Michigan, a person who wants to sue on a traditional theory of breach of contract or negligence would probably try to negotiate a resolution of the problem they have with their contractor before filing a lawsuit against them. This is standard in the case of any lawsuit.
Another option would be to try an alternative dispute resolution procedure, e.g., mediation, with the contractor. Of course, if none of these options are successful, then a person would have to think about going to court.
A person’s first step is to gather all evidence they have that supports their claim. This includes evidence of any contract they may have had, invoices, and receipts. Evidence of communication a person has had with the contractor, such as emails or text messages, would also be important. It would also be critical to document the damages a person suffered because of the contractor’s negligence or breach of contract.
To file a lawsuit against the contractor, a person would need to prepare a complaint. Filing the complaint with the clerk of the court and serving the complaint and a summons on the defendant contractor begins a lawsuit.
A person would have to select the court in which to sue. A person can sue for up to $6,500 in a Michigan small claims court. If a person wants to sue for more than $6,500 and up to $25,000, they would file their complaint in a Michigan district court. If a person wants to sue for damages of more than $25,000, they would file their complaint in a Michigan circuit court.
How Much Does It Cost to Sue a Contractor?
This question cannot be answered with specificity. How much it would cost to sue a contractor is going to depend on a number of things. If a person files their complaint in a Michigan small claims court, they would not have to be represented by an attorney. This would reduce their cost significantly.
If a person sues the contractor in a district or circuit court and has an attorney represent them, the cost would depend on how much the attorney charges and how much time the attorney must devote to the case before it can be resolved. That is because an attorney is likely to charge an hourly fee for their service.
Reportedly, in 2022, the average hourly rate for a Michigan lawyer was $269 an hour. This is the average hourly rate. Some lawyers are going to charge more. So, a person can estimate the cost of a case. In addition to attorney’s fees, a person would have to pay court costs, e.g., the fee to file a complaint.
In a case about a construction project, a person might need to hire an expert witness to testify about how the contractor’s work is deficient. This would add to the cost.
What Is the Statute of Limitations for Contract Disputes?
In Michigan, the statute of limitations for a breach of contract action is 6 years. An action against an architect, engineer, or contractor must be brought within 6 years after occupancy, use, or acceptance of an improvement project. The statute of limitations for a construction defects case is 1 year after a defect is discovered or should have been discovered. The defect must be the direct cause of injury or damage and result of the contractor’s gross negligence.
Do I Need an Attorney for Suing a Contractor?
You want to consult a Michigan contract lawyer as soon as possible if you have a significant issue with a contractor. LegalMatch.com can connect you quickly to a lawyer near you who is ready to take on your case and make sure your rights are protected. Contract laws can be complex, but an attorney can provide you with the legal representation and guidance needed for your claim.
