Disaster Relief Contractors: What to Do When You Don’t Get Paid

One thing can be said about Harvey. It certainly did its share of devastation. As a result, disaster relief contractors will be busy for a long while to come. Despite the influx of work, there are some concerns. Without a doubt, worrying about getting paid is one of them.

Turn on any news channel, and you might hear stories of crooked contractors taking advantage of Harvey victims. However, it’s the stories that aren’t told that are more prominent. With estimates for hurricane relief well into the billions, there are a whole lot of contractors out there. Most are honest and just looking to ensure they are compensated for their work.

Disaster relief contractors are made up of a few different types of trades. First, there are those doing debris removal. Meanwhile, general contractors, plumbers, and electricians all are integral parts of rebuild efforts. Additionally, tow truck companies and janitorial supply businesses all see an uptake in receivables during storm recovery efforts. Some of the contractors will be local. However, a great many have come to help from other states.

Start With a Written Contract

A written contract is something that works for both the disaster victim and the contractor. In fact, you might want to read our article geared to those needing remediation assistance. Although there are circumstances where a handshake agreement may hold up, it’s more sensible to contain your price and work to a written document.

All things considered, you should really have an experienced business attorney take a look at your proposed contract. Generally speaking, there are problems with taking boilerplate agreements from internet resources. For the most part, they will not be state-specific. In the end, this could hurt you if you need to start collection efforts.

Disaster Relief Contractors and FEMA

Just about everyone recognizes the acronym FEMA to stand for Federal Emergency Management. FEMA actually provides a checklist regarding contractor requirements. Without question, it is a good idea to review the directives provided by the federal government.

First and foremost, contractors should be aware of the types of contracts that FEMA discourages. For example, your attorney can advise you regarding the necessity to avoid time and material contracts when looking for payment in conjunction with FEMA requirements.

Mechanic’s Liens and Construction Liens

In the meantime, disaster relief contractors and suppliers should know about Texas law as it applies to both mechanic’s liens and construction liens. First, mechanic’s liens are placed on property for a variety of reasons.

Texas property lien laws appear in Chapter 53 of the Texas Property Code. More specifically, the chapter includes expectations regard Mechanic’s Liens, as well as Contractors and Materialman’s Liens. Labor performance is just one reason a company doing disaster relief might need to file a lien. Without question, material is another. Meanwhile, an architect, engineer, or surveyor might be entitled to file a lien for preparation of a plan or plat.

Although there are no legal requirements for filing a notice of lien, Texas has other requisite notices in unique circumstances. For example, if you do work directly with the homeowner, you may not need to file a notice of lien. Meanwhile, there are different laws in effect for subcontractors and suppliers. Without a doubt, you should discuss lien requirements with your attorney when you meet to draft your work contract.

Contact Us

At the Law Offices of Manfred Sternberg and Associates, we have represented a number of contractors regarding their concerns about payment for their work. Give us a call to see how we can help!

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