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Discussion Starter · #1 ·
I have a sub that is very annoying and pesky. I cut off work to this sub Jan 10, 2013. With my company I've made it a policy to rendered final payment 90-120 from last job. I do this to make sure my clients pay out and don't cut my invoices or whatever. Needless to say this idiot has called my client and complained and threaten to lien properties. My contract has a waiver of lien rights and a clause that late work will be penalized to the tune of 50 percent for 1 day late then 100 percent for 2 days or more late. From her invoices their is $1100 dollars discounted off for late work according to the contract. Problem is she never fully signed the contract but verbally agreed to it because at the time her husband was having surgery and we both just forgot about it. What should I do?? Love to hear your thoughts.
 

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To be honest 90 - 120 days out would be a non starter for us. Considering she did not sign the contract then none of it is really enforceble. I know I for one would have already liened the property after 60 days.
Doesn't matter what the contract states, in some states you can lien the property no matter what. Best bet would be to pay up, besides if it is taking you over 3 months to get paid from your client that is your problem not the subs.
 

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As a GC in WI, I can legally lien (and so can my subs) any property that I haven't been paid on or haven't paid them on with in 60 days, irregardless of any contracts. All I have to do is notify the party contracting with me of this fact. Guess what, every bid and proposal has this disclaimer on page 1.

I can see 30 days, longer than that is ludricous. QC your subs work. Don't wait to see what your client does. Afterall, your sub worked for you. Not your client.

Just my $0.02 worth
 

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Lien wavers are for after work is completed, we often do final payment lien wavers, but I would look into the legalities of the contract lien wavers they might not be valid in your state. Our national puts a disclaimer at the bottom of each order " by accepting this you waive lein rights..Mediation... Blah blah" but if they were to take 120 days to pay me it would void the entire contract and I could lien whatever I wanted. Just explain the situation in an email of course the sub will be upset out of a job and waiting on money, but maybe it can keep the tension down to stay in communication. And def get a paid in full waiver for each property!
 

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I agree with BradsConst.

Your contract really means nothing (signature notwithstanding) since your State Contractor law takes priority/precedent. 90-120 days? If I was your sub I would have a lien on every property within 30 days of figuring out that work wasn't coming my way THEN I would turn you into the State Employment Agency for unemployment compensation...may win may not but it would sure cause you a lot of unhappy nights.

Ah but then again maybe she really isn't that "pesky" ;)
 

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If it is not in writing it is a rumor, and rumors do not stand up in a court of law. She did not sign the contract so that means basically she gets to dictate terms.

You need to chalk this one up to getting an education from the school of hard knocks and move on.

One lien from her, which is legitimate specifically because she did not sign the contract, and I would be willing to bet hard cash you will loose that customer forever.

I am not even sure your contract is enforceable with payments stretched that far. There are laws that govern how fast a sub has to be paid for work completed particularly when you are dealing with a small business and more so if it is owned by a woman.

The late penalties you have imposed are basically liquidated damages and the law specifically states that liquidated damages cannot be imposed if they are too harsh, if they can be deemed to be a form of punishment or if they exceed the amount that you have lost as a result of the infraction. They are to offset your real loses without you making a profit from them.

And any lawyer worth the ink on his bar license will be able to prove they are one the three aforementioned things.

And if your contract is too one sided a judge will most likely deem it null in its entirety. You have to outline what protections there are for the sub as well as for you.

I would have already filed a Notice of Nonpayment for each property and a Notice to Owner for each property and if I go through that much expense and trouble you will need to drive the cash to me to keep it from becoming a lien.
 

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I have a sub that is very annoying and pesky. I cut off work to this sub Jan 10, 2013. With my company I've made it a policy to rendered final payment 90-120 from last job. I do this to make sure my clients pay out and don't cut my invoices or whatever. Needless to say this idiot has called my client and complained and threaten to lien properties. My contract has a waiver of lien rights and a clause that late work will be penalized to the tune of 50 percent for 1 day late then 100 percent for 2 days or more late. From her invoices their is $1100 dollars discounted off for late work according to the contract. Problem is she never fully signed the contract but verbally agreed to it because at the time her husband was having surgery and we both just forgot about it. What should I do?? Love to hear your thoughts.
I you hadn't posted here before I'd have said you were trolling....
 

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Knock on wood...never had to lien a prop yet for non payment. As far as subs go......I always pay my subs upon completion, I hired them, I pay them regardless of the deal I have with the client I'm working for. Had the same face to face meeting with a client 2 yrs ago about 60-90 pay. (original deal was 30 day max) They said they can't pay till their client pays. I said no way, YOU hired me, you pay me on our agreed terms. Heated argument with the head honcho until they cut a check while I sat at the table and we parted ways.
 

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WHEW!!!! lots of horrible advice here! Since I doubt any of us are attorneys, my advice is see an actual attorney and don't get your legal advice on a message board.

I have been through this a few times and like you we hold final payment for a minimum of 90 days. We also are indemnified and held harmless the same as our clients. It is much harder to lien a property than most would have you believe. Once the lien has been filed it still has to be perfected and must hold up in a judges eyes. The fact that neither of you has a contract is just as good for you as it is bad.

In most of these cases the sub needs the money so you will find them more willing to settle. Justify your position through facts make a final offer, with that offer attach a final lien waiver and a statement for them to sign stating this is it. Write them a check and be done.

I have had contractors go out and screw up jobs then bill me double or triple even what the national pays. They call the national and the national will tell them it's between you and the company you were getting work from. If this person will not reason and or begins harrasing have a NO CONTACT order slapped on them for $30.00 at the local PD. This order will extend to your business and anyone you work for. If they contact you or your clients again they will face charges.

I had a contractor threaten to come beat one of my office girls this past December. He had gone to a property for a lock change and wint. He for some unknown reason did a trash out and sales clean without a work order. Luckily all he threw away was trash but then he billed me for it. I told him I wasn't going to pay he should have read his work order better. We spell out exactly what is to be done in plain english. This guy had worked for FAS and only knew their way of doing things. In the end I slapped him with charges, my attorney fees, and he now owes me money.:whistling2:
 

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I read a lot more personal anecdotes than advise. Everyone is free to run their biz as they choose. I don't wait 4 months for payment; I don't make my people wait four months for their money. I don't make my problems with a client the problems of my subs. I don't let my sub's problems become my problems. Works for me. Your mileage may vary.
 

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After all, your sub worked for you. Not your client.

Just my $0.02 worth





Thats how I've always ran the odd job where I have a sub.
 

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What was the work for? In michigan you can't lien a property for service work only improvement work.

Check your state laws
 

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Making a sub wait 90-120 days is ridiculous.

Please tell me what national takes 90-120 days to cut invoices. I have never worked for a national that took longer than a couple of weeks to cut an invoice on a job due to CYD count, etc.

Chargebacks for missing something are another story, and can happen at any point in future, so still no benefit to holding money.

We pay subs in 30 days at most, some quicker if it's a small job. We get paid in ~45. 30 days is enough time to get the order through the nationals QC process. We sub maybe 5-10% of our business.
 

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I have been through this a few times and like you we hold final payment for a minimum of 90 days. We also are indemnified and held harmless the same as our clients. It is much harder to lien a property than most would have you believe. Once the lien has been filed it still has to be perfected and must hold up in a judges eyes. The fact that neither of you has a contract is just as good for you as it is bad.

In most of these cases the sub needs the money so you will find them more willing to settle. Justify your position through facts make a final offer, with that offer attach a final lien waiver and a statement for them to sign stating this is it. Write them a check and be done.
I'm confused here. Are you saying you will hold subs payments for 90 days, hoping they will be desperate for money and settle for a lesser amount? That would have to be the lowest of the low in business practices.
 

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Discussion Starter · #19 ·
I hold last payment for 90 days min. I've worked for a few companies where the last payment is 60 days out. No big deal deal because I might only be owed a few hundred. In this case I had this Sub refuse work in mid-jan because she did not have the capital to operate. Not my problem, if I told my clients I am having a money problem and can't work for a week, maybe 2, what will happen........yep they will find another vendor. With this I had to personally go out in the field for 2 days and cover her work. I should charge her a reassignment fee per order, but I haven't.
On the topic of 50 percent for 1 day late and 100 percent for 2 days late...I'm sorry but I'm one of those that want a perfect scorecard and I don't want late work. My subs don't get the calls and emails from clients asking about late work, I do !!! Besides that it gives me a better chance to expand with my existing clients. Basically get the work in on time and there isn't a problem. If your having an issue with say your equipment or truck... let me know and I won't discount.
I am not having a money issue myself or an issue with my client at all. Simply my client doesn't pay for late work and if I'm held to that I am surely going to pass it down.
My subs are paid every week. Paid pretty good I think. No special software to download orders or anything. We Just simply use Dropbox for everything and the sub sends me invoices. which upon auditing I have found this sub never discounted her work according to the penalities. I have sent her audited invoices the other day and she complained saying "how can you discount me 50 % on a few orders that were sent to me at 630 am due for that day? , which we did the next day" I said I'm sorry my clients want same day turn around on a few orders and if not in I get discounted by them and these few orders are litterally in the same zipcode you live in and are just simple grass cuts orders. She didn't say anything back.
I'll always pay out what is rightfully owed not a question, but this lady called my client 5-6 times a day for 3 days straight, lying right to the clients saying she is owed $7k when after auditing her invoices (I wasn't even going to discount her invoices and I never did intill she started calling my client and making threats to "make sure my client ceases to give me work") Then it just pissed me off and I said fine I will discount her based upon my what my contract states.
 

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Trying to discount because the order was received in the morning and not turned in till the next day, really?
I don't want to appear combative but, there is no way that you can expect to send an order in the morning and have it done the same day. So in other words you want this person to be available 24 hours a day and not be able to schedule any other jobs for their company (sounds like an employee if you ask me).
We have a policy that any order received after 6PM the night before is considered not received until the following day. As a business owner we need to schedule our days. Sure there might be once or twice that a client may ask us to go the same day but they ask first and if we agree there is an additional emergency trip fee and if we can't then we tell them there is no such thing as forcing an independent contractor to do it.
I am sorry but in my eyes and I have been around a while, it sounds like you are looking for reassurance, but there is no justification for holding money that long. If I was the vendor there would probably be a knock on your door.
 
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