There is nothing worse than when a home improvement project comes to a standstill because the contractor stops turning up to complete the job. Last week, the house was overflowing with the noise of sawing and hammering, as if progress was being made, and then the next week, the tools have all but disappeared and the dust is starting to settle. It seems the contractor has vanished into thin air. The first thing to do is call the contractor but no one answers. Meanwhile, your kitchen is in a mess and your unfinished deck is left exposed to the elements.
If your contractor has stopped showing up to your job site, you are probably dealing with what’s called contractor abandonment. Fortunately, in Massachusetts, there are robust consumer protection laws which are specifically designed to safeguard homeowners from these sorts of home improvement nightmares.
There are several steps you can consider taking to help protect your investment.
Step 1: Establish your approach to the problem
When a contractor vanishes completely the likely reaction is to phone the business and leave angry voicemail messages. It is far more proactive to remain calm, take a deep breath and use texting and emailing instead. All forms of written documentation are your strongest asset. Do the following first:
- Send a 24-hour formal inquiry to the contractor in the form of a professional email or text outlining the length of their absence and requesting a written status update by a particular date that you have provided.
- Take a series of photos that provide an accurate picture of the current job site state including unfinished installations, exposed structures and any potential safety hazards that still exist.
- Create a spreadsheet that shows all the payments that have been made so far. Keep copies of bank transfers, and/or credit card receipts. You should not have made any cash payments.
Step 2: Check the contractor’s HIC registration status
In Massachusetts, residential home improvements are strictly regulated under Massachusetts General Laws Chapter 142A. Under this law, any contractor undertaking work on owner-occupied, one-to-four-family primary residences must be registered as an Improvement Contractor (HIC).with the Office of Consumer Affairs and Business Regulation (OCABR)
You can make a contractor search to find out if your contractor is registered as an HIC.
If it’s registered, you then have access to cost effective, specialized state programs to recover your losses. If your contractor is unregistered, it will be operating illegally, which gives you some leverage under Massachusetts state consumer protection statutes.
Step 3: Review your contract and Chapter 142A mandates
Extract the original contract you signed. In Massachusetts, if your home improvement project exceeds $1,000, state law mandates that the contract must be in writing. In addition, M.G.L. c. 142A sets out clear boundaries on what a contractor can legally demand from you:
- The Deposit Rule states that the initial upfront payment cannot exceed one-third (1/3) of the contract price, unless it is necessary to order special materials ahead of time. If your contractor requested 50% or more upfront and has now vanished, state law has already been violated.
- The Building Permit: Did the contractor provide the right building permits, or did they put pressure on you to get them as an “owner-builder”? If you got the permits yourself, you may have inadvertently waived your eligibility for some of the state’s sponsored restitution programs.
Step 4: Pursue restitution and legal remedies
If your contractor has clearly abandoned the job and not replied to your request for updates, it is time to take up the matter. Massachusetts homeowners have the following avenues to follow to pursue justice and gain financial compensation:
1. Send a 93A demand letter
Before you take the contractor to court or state arbitration, a formal 30-day Demand Letter under M.G.L. c. 93A (the Massachusetts Consumer Protection Act) must be sent first. Because any violations of the HIC law (c. 142A) will automatically be a violation of c. 93A which means a contractor who abandons a project could face severe penalties.
If a court finds that the contractor misled knowingly or willfully, it can be ordered to pay double or triple damages, along with your attorney’s fees.
2. Apply for HIC arbitration
If you find your contractor is registered and your contract does meet state guidelines, you can apply for the Home Improvement Contractor Arbitration Program. Arbitration is informal and much faster than waiting to have your case heard in court. HIC arbitration claims enforce a cap at $10,000.
3. File for the residential contractor guaranty fund
If you win a court judgment or an arbitration award against a registered HIC contractor but can’t collect the money because the contractor has filed for bankruptcy or disappeared completely, you might be eligible to apply to the Massachusetts Residential Contractor Guaranty Fund. This state managed fund can compensate distressed homeowners up to $10,000 to cover their actual financial losses.
4. File an OCABR disciplinary complaint
You can lodge a formal complaint using the MA Contractor Hub. Filing a complaint does not offer monetary awards for you, but it initiates an investigation that could lead to administrative hearings, hefty fines, or the suspension of the contractor’s registration, preventing them from victimizing other Bay State residents.
5. Take the matter to court
If your financial damages do not cleanly fit into state arbitration, you may file a lawsuit:
The Small Claims Court suits simpler disputes which are seeking damages up to $7,000. This is fast, affordable, and can usually be handled without the need for a lawyer.
The District or Superior Court is required for complex, high-value renovations where the damages are more than $7,000.
Moving forward: hiring a completion contractor
Do not consider hiring anyone else to complete the work until you have officially terminated your last contract in writing with the original contractor. You should consult a local Massachusetts construction attorney so that you can be sure your termination notice is legally sound, so the original contractor cannot claim at a later date that you breached the contract by locking it out.
Once the old contract has been cut completely, you should seek detailed quotes from a new, fully registered HIC contractor to complete the project. The difference between what you agreed to pay and what it costs to fix and complete the job will be the basis of your legal claim against the contractor who walked off the job.