From Our Perspective: Subcontractor Not Paid For Work

“From Our Perspective” provides unique insight from some of Robinson & Henry’s most experienced attorneys. In this video series, we take a closer look at cases won by our attorneys, and, from time to time, we’ll share our thoughts on other cases and legal issues in Colorado.

In this episode, R&H Civil Litigation Partner Steve Whitmore discusses a recent case he won at jury trial in Denver County District Court. 

The case is about a construction project at a home in Colorado involving two former friends doing business together. Our client, Rein, Inc., worked as a subcontractor for Cobblestone Design Build that decided not to pay our client $140,000 for work completed on the project. Steve took on Rein, Inc.’s case and explains how he recovered more than $100,000 for his client.

Past results afford no guarantee of future results; each matter is different and must be judged on its own merits. Facts are those of an actual Robinson & Henry litigation case. 

Question: Steve, tell me more about this case, who we represented and what was the issue.

Steve: In this case, we represented a contractor. It was Rein, Inc., or ReinHouse Design. Our client handles all kinds of contracting responsibilities. In this particular job, he was asked to install some pavers for a very beautiful home in a very nice neighborhood. The company that he contracted with was a company by the name of Cobblestone Design Build. Now the owner of Cobblestone Design Build and the owner of Rein, Inc., were former friends. Consequently, as things work among friends, they probably didn’t do the best job of papering their deal, of deciding what was going to be done, when it was going to be completed, and those types of things. So as the job progressed, there were some spats, there were some disputes and some discussions, and eventually what happened is my client got frustrated with his friend and sent out some texts, which said, “That’s it; I’m finished with this job. “Keep the money. I don’t even want it; I quit. “I’m leaving my subcontractor behind “to take care of this deal.” Well, the other side, Cobblestone Design, used that and said, “Okay, well, you’re quitting the job. “If you’re quitting the job, I’m not gonna pay you.” Now that’s not really what the parties intended. You know, we’ve got two friends here who, they lower their guard, they talk to one another, they speak freely, they talk in hyperbole, you know, as friends do. Unfortunately, that doesn’t translate well when you’re conveying those messages in a text.

Question: You mentioned they’re friends, you mentioned the text messages. What were some of the biggest challenges of this case?

Steve: Well I think those messages were the biggest challenge. My fear as a practitioner was I’ve got a client here who’s done the majority of the work, but he sent messages that are in writing, that a jury’s gonna look at and hold in their hands and read, which say, “Keep the money; I don’t even want it. “Forget it. I quit. “It’s over and done with.” And how are we going to explain to the jury that, you know, what was written in a text is not really what was conveyed between the parties? That was the fact that kept me awake at night. And that was the fact that, every time I met with my client, I said, “We’ve really gotta focus on this.”

Question: What was the other side’s defense heading into trial?

Steve: Well the other side basically said, “Look, I’m looking at the text right here; you quit.” Now that defense, you know, I don’t know how strong that defense was because clearly my client had done more work, significantly more work than he was paid for. The other side also claimed that they had to do some additional work based on mistakes or errors made by my client. Now at trial, they didn’t prove up those mistakes or those errors, so I think it became apparent to the jury pretty quickly that our client, Rein, Inc., did this significant majority of the work and hadn’t been paid for it.

Question: What were the damages awarded, and what comes next?

Steve: The way it worked out, my client had asserted claims for breach of contract and for a breach of Colorado’s Mechanics Lien Statute, a Trust Fund Statute, and we prevailed on both of those claims. On the breach of contract claim, the jury awarded my client $104,000. I think the jury ultimately decided that, while we were asking for $140,000 the work performed by my client was valued closer to $104,00 to $105,000. So we prevailed on that claim. Now suddenly by this jury verdict, my client has the ability to recoup some of his fees related to this case. So that was a big win for us. On the other side of the coin, the defendant, Cobblestone, asserted counterclaims against our client, counterclaims for breach of contract, for a trust fund violation similar to the one that we had alleged against them, and for conversion. Conversion is similar to theft. It’s when you take someone else’s property, and you don’t pay for it. We prevailed on all three of those claims, so the jury ruled in our favor and against Cobblestone on all of those claims. So that was very important as well.

Question: Steve, if someone is watching and in a similar situation, what type of advice would you give them?

Steve: Well, if you’re going to do business with friends, get it in writing anyway. Really the failure here was that the parties because they used to be friends; they relaxed their guard. They didn’t take precautions that they normally would’ve taken to make sure you understand what the specific scope of work is, what the exact price is going to be when payments are going to be made, how changes in the work are to be addressed, completion deadlines, those types of things. Because when you leave that up in the air, all you’re really doing is creating a mess subsequently, and that’s what happened here.