Philadelphia, PA asked in Contracts and Construction Law for New York

Q: Not able to pay contractor remaining installments because of sudden financial difficulties .

New York, NY | 11 minutes ago

A bit complicated and long question - I've hired a contractor company to renovate our apartment in New York City. We have a contract that only states that we will pay total cost divided by 5 installments. it is very vague and has nothing written about due date/ deadlines/conditions or laws. we paid the first installment as down payment to do demo. The contractor has finished the demo work for first installment and won't start again unless we pay the next installment, which is correct.

However I currently have sudden family financial difficulties and want to stop continuing the remaining work at my apartment because I have no money to pay the remaining installments. technically speaking, I have paid the contractor the work they've done at my apartment (they only did demo and won't start unless I pay the next installment). My question here is can I just explain my situation with the contractor and ask them to not work because I can't pay them anymore?

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1 Lawyer Answer
Michael David Siegel
Michael David Siegel
  • New York, NY
  • Licensed in New York

A: You should not have them do work you cannot pay for. That is going to lead to damages against you, and a lien on the apartment. You should tell them to stop work, and that you are not paying. Your breach entitles them to "quantum meruit" damages, which is payment for work done, which you say you paid. It also entitles them to damages if they cannot get another job. They have to mitigate damages by working elsewhere, but you have to pay for any loss. However, a mechanics lien can only be for work done. Long answer to a short question, tell them and tell it in writing. You still may be sued, but you are setting up your best defense.

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