You Paid A Contractor For A Job They Never Finished - Now What Happens?

Home renovations and building projects are meant to be an exciting time of transformation, when the bathroom or kitchen of your dreams finally comes to fruition. You do research, shop around for contractors, and then hand over a deposit for the work to begin, expecting it to be done to your standards. However, every once in a while, you may make a mistake and hire a contractor with some red flags, which ultimately leads to an incomplete project. This contractor may ghost you: a one-day delay in communication spirals into a week, then a month. It's an anxiety-ridden situation when you've paid a contractor for a job they never finished. Fortunately, there are solutions that you can pursue. These include documenting the issues, communicating with the contractor, taking the situation to the licensing board, and pursuing legal action.

Before you reach the point of "contractor ghosting" and the recourse that comes with it, be sure to take proper precautions. For example, having a written contract with your contractor that outlines the deliverables and payment schedule is a key form of documentation. It's a common mistake that everyone makes when hiring contractors and starting work on their home, believing that a handshake, conversations, and an invoice suffice as a contract. A contract is in place to protect the interests of both parties, particularly if the contractor makes mistakes or if the client unrealistically demands work outside the scope of the project. Another precaution is to ensure communication is documented, whether it be through email or text messages. With these careful considerations in place, hopefully you'll never have to pursue recourse after a contractor ghosting, but if you still do, there are several courses of action.

First, ensure the contract has indeed been violated, then document the situation by taking photos of the abandoned project and writing down what was finished (if anything) and what was left undone. This material will become your evidence for any legal or insurance recourse. Then, send formal written communication to your contractors, clearly and coherently stating the breach of contract, which items were not completed, and providing a deadline for the work or a refund. The letter will constitute a good-faith effort to resolve the issue before escalation.

So what is that escalation? One avenue is to file a claim to recover some of your lost funds through the contractor's surety bond, a form of specialized insurance that the contractor must carry, which guarantees that the holder of the bond will execute the terms as set by the state or licensing board's protocols and statutes. Keep in mind that you will only be able to recover up to the amount of the bond, meaning there may be a cap that does not fully compensate for the project. 

Of course, you can also take your claim to Small Claims Court if the disputed amount is under a certain threshold, depending on local laws. It's a lawyer-free legal route you can take to maximize your return, though for amounts that exceed the area's threshold, you'll likely have to file a lawsuit with a civil attorney. While winning a judgment is a victory, collecting it will be the next hurdle. Consider reporting the contractor to the licensing board, as well, to ensure nothing like this happens to other homeowners. It may seem like a hassle at first, but you're doing the right thing for yourself and others.