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Half-fast Eddie

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Discussion starter · #1 ·
There is another discussion going on tangentially related to this, but it’s at times incoherent so i thought I would start fresh.

Job in progress, who owns the material delivered to the site but not installed? Someone mentioned that in Calif it belongs to the contractor until installed. I have never been involved in a situation like this, but i thought i remembered discussions elsewhere that once delivered it belongs to the customer.
 
#2 ·
I would suspect there are many different state laws. He who buys the materials own them. I always tell the clients when I'm installing something that takes many days (kitchen for example) that it's mine until the final payment. No one has ever disputed that with me. But I do know that once the screw is driven into the wall technically it's theirs. Although the doors, drawers and anything else that can be removed from those cabinets can be taken if there isn't a final payment. Rendering them nice looking boxes.

But what about deck materials being placed on the HO property but not installed. Roofing materials place on the ridge etc.
 
#4 ·
Leo G said:
But I do know that once the screw is driven into the wall technically it's theirs. Although the doors, drawers and anything else that can be removed from those cabinets can be taken if there isn't a final payment. Rendering them nice looking boxes.
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The judge would tell you to come up with the doors and drawers or he'd come up with a jail cell.

You can't "uninstall"anything for non-payment.
 
#6 ·
Kowboy said:
The judge would tell you to come up with the doors and drawers or he'd come up with a jail cell.

You can't "uninstall"anything for non-payment.
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I've seen it done successfully. The doors are not attached to the house, they are not the HO property if they didn't fulfill their part of the contract (payment)
 
#7 ·
In my neck of the woods, it's mine until I install it. Then it becomes part of the real estate regardless whether I've been paid for it or not.
 
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#8 ·
My understanding in simple language is if the material is sitting on site, but not yet incorporated into the works, the contract terms will be important in deciding if the material is recoverable. This is the only unsettled legal issue that should be addressed in your contracts.
Legal precedence is clear and settled that If the material is installed, it is "incorporated into the property" and the contractor is not entitled to remove any goods from site, even if they have not been paid for.
 
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#9 ·
My understanding is in MA the contractor owns the materials until they are installed. I'm not sure how payments would work as there isn't a way to know if it was for labor or materials. Obviously once a lawyer gets involved all bets are off.
 
#10 ·
Half-fast Eddie said:
There is another discussion going on tangentially related to this, but it’s at times incoherent so i thought I would start fresh.

Job in progress, who owns the material delivered to the site but not installed? Someone mentioned that in Calif it belongs to the contractor until installed. I have never been involved in a situation like this, but i thought i remembered discussions elsewhere that once delivered it belongs to the customer.
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So if I'm working on a project and I need 3/4 a bunk of 2x4s, for example. (I don't know how many are in one, but it's a relevant example)

I know I'm going to need a few 2x4s for a different project and have the whole bunk delivered to job 1. It's cheaper to buy that way...

Job 1 owns them all because I had them delivered to their site, even though they aren't being charged for them and they won't be used there?

Or maybe I need $100 worth of 1x2 that isn't even a product being used on that job, but have it delivered there for my convenience. Does that belong to the homeowner now?
 
#11 ·
My contract states that I own and pay for all material, and any extra material upon job completion unless otherwise noted.

I always bring extra material to a job, and only a handful of times I've heard "Are you leaving that here? I paid for it"

No you didn't, read your contract, you paid for the job I just did, not the extra I brought to do it with.
 
#12 ·
In Cali it belongs to the contractor until paid for.

However the contractor may not repossess installed materials for non-payment.

I have thousands of dollars of materials in my service body at any given time. They don’t become the property of the customer because I pulled up in their driveway.

Special orders are different, if the customer paid for them at the time of ordering, and it was specified in the contract that “X progress payment is for X special order materials.“.

That’s how I do my contracts. I believe it’s a grey area in California, because technically you may not charge for “work not performed or materials not delivered to the job site”.

However, I’m not fronting tens of thousands of dollars for materials I can’t return or use elsewhere.

If it ever becomes an issue, I’ll just make them pay the supplier directly, and pay my markup in a progress payment.
 
#13 ·
In NJ its the contractors until its installed, which does not mean it has to be fastened to the house. A drawer in a cabinet is installed, a drawer in the garage is not installed. I can tell you 1st hand in NJ if you remove something that has been installed you can be charged. Many years ago it happened to me at a company I worked for, we removed a bunch of stuff that was not paid for from several buildings and had to return it all. The police were tracking us down the entire afternoon.
 
#15 ·
pinwheel said:
So you can't require materials to be paid for in advance in California? I somehow doubt that's true, even in the land of Fruits & Nuts.
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Contractors in California can receive a down payment of $1000 or 10% of the project total, whichever is less. That statement is required by law to be in our contracts. They even specify the text size.
The contract I use was written by an attorney, as the state has several requirements and statements that have to be incorporated in them.
 
#16 ·
Pounder said:
Contractors in California can receive a down payment of $1000 or 10% of the project total, whichever is less. That statement is required by law to be in our contracts. They even specify the text size.
The contract I use was written by an attorney, as the state has several requirements and statements that have to be incorporated in them.
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Just one more reason I'd never want to live in that state ran by communists.
 
#17 ·
Found the rules.

Required Contract Provisions for Construction Contracts in California
Under the California Business and Profession Code, section 7159, you'll find the statute that manages all home improvement contract requirements in the state.

All home improvement contracts for work being done in California should include several key statements:

  • Upon making a satisfactory payment for any part of the work that is performed, the contractor must furnish an unconditional and full release from any possible claimant for a mechanics lien before receiving any additional payment.
  • The project owner will not require a contractor to perform changed or extra work without prior written authorization before the work begins, also known as a change order.
  • Entitlement to a complete copy of the agreement, signed by both involved parties, before any work begins.
  • What constitutes the substantial commencement of the project, as agreed upon by both parties.
Make sure a contract also includes several required subheadings:

  • Price of the contract, with details of the payment required for the work being done.
  • Description of the project, including equipment to be installed and significant materials that will be used.
  • Down payment requirement, which may not exceed 10 percent of the total contract price or $1,000 (whichever is less).
  • Schedule of progress payments (if applicable), with the required amount of each payment during the progress of the work. If the agreement does include a progress payment requirement, make sure to include a statement that a contractor cannot charge for any work that hasn't been completed, with the exception of a down payment.
  • Any required finance charges that will be applied to a late payment.
  • Change orders and extra work, which should outline what will be required if the involved parties sign a change order before the scope of the work changes or additional work is required.
  • Approximate start and completion dates.
  • Any documents that will be incorporated in the agreement.
 
#18 ·
pinwheel said:
Just one more reason I'd never want to live in that state ran by communists.
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You get used to it, just a part of doing business. The reality is I'm never more than $50k out of pocket.
Honestly, that's the easy part. Dealing with some of the city requirements can be absurd.
I have a small project that coming up, replacing an existing 11x20 detached garage with a new 11x20 building that will be half storage and half home office. The building will have no plumbing in it. The owner will have $14k invested in plans, and permits before I drive the first nail.
 
#19 ·
Pounder said:
You get used to it, just a part of doing business. The reality is I'm never more than $50k out of pocket.
Honestly, that's the easy part. Dealing with some of the city requirements can be absurd.
I have a small project that coming up, replacing an existing 11x20 detached garage with a new 11x20 building that will be half storage and half home office. The building will have no plumbing in it. The owner will have $14k invested in plans, and permits before I drive the first nail.
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And this, folks, is how the cancer spreads.
 
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