subcontractor dispute

[CashProperty]

Looking for some advice on how to handle a subcontractor dispute with main GC. Here's some background information:

A client of mine hired a contractor to do a bunch of renovation work.
The contractor then hired a subcontractor. The subcontractor was to install material provided by the contractor.
The contractor has refused to pay the subcontractor, claiming poor quality of work.

What responsibility does my client have towards the sub?
What liability does my client have due to the subcontractor not getting paid?
What actions can the sub take against my client?
What advice or suggestion, would you give to my client?

Thank you in advance.
Huong

***MORTGAGE ELIMINATOR***
Real Estate Coach & Consultant
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Cash Property Inc.

 

[Thomas Beyer]

Unless sub liens do NOT get involved. That’s the GC’s job.

If you or GC disagree with lien send a 21 day notice

Sub then has to go to Supreme Court in BC / Court of Queen’s Bench in AB which is very expensive


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[Matt Crowley]

The sub can register a lien against the property, and it is actually not hard at all to do. If they have been in business for very long at all they probably know all about this. The sub's claim can be removed from the title but it is a bit of work and takes time.

Ultimately, the owner is responsible to pay the subcontractor and the sub has a right to enforce against that. Before paying the contractor, the client should seek to ensure that subcontractor matter is settled or have some holdback against the contractor to settle that liability. Need to read the contract with the main contractor on how to deal with this, but the owner is ultimately liable to pay the sub.

 

[Thomas Beyer]

The sub can register a lien against the property, and it is actually not hard at all to do. If they have been in business for very long at all they probably know all about this. The sub's claim can be removed from the title but it is a bit of work and takes time.

Ultimately, the owner is responsible to pay the subcontractor and the sub has a right to enforce against that. Before paying the contractor, the client should seek to ensure that subcontractor matter is settled or have some holdback against the contractor to settle that liability. Need to read the contract with the main contractor on how to deal with this, but the owner is ultimately liable to pay the sub.

Not quite.

If the lien is in dispute, which it appears it is, then you send a 21 day notice to dispute the lien. The sub now has to go to court which is a very expensive and time intensive process most vendors don’t go if claim amount is small.


Thomas Beyer, Asset Manager, Investor, Community Improver, Author, Father, Mentor www.prestprop.com