New York is home to some of the most expensive real estate in the world. If you are a homeowner in New York, it behooves you to ensure that your property is well maintained. This can mean that you’ll need to hire a contractor to handle a small-scale renovation to your home or apartment. Unfortunately, disputes are not uncommon between homeowners and contractors. Perhaps your contractor uses the wrong materials, takes too long to complete the job, or abandons the job altogether, taking your deposit and disappearing.
How can you get your money back and get compensated for any damage? For small projects, like kitchen repairs or window replacements, you probably lost only a few hundred or a few thousand dollars – a lot of money, but perhaps not enough to justify the cost of hiring an expensive attorney. New York's Small Claims Court might be a good solution.
Small claims courts across the U.S. allow individuals to sue people or businesses without the need for an attorney. In New York, the court systems differ a bit depending on whether you live in the five boroughs of New York City (Manhattan, the Bronx, Brooklyn, Staten Island, and Queens), or elsewhere in the state.
In the City, you can sue in Small Claims for up to $5,000 in money damages. Outside of the City, you can sue for up to $3,000 in Town and Justice Courts. While Small Claims Courts have judges, Town and Justice Courts tend to have local attorneys or “part-time” judges acting as the deciders. In both types of courts, you generally won’t see a jury.
Regardless of whether you’re suing in the City or outside of it, there are certain state-wide laws called "statutes of limitations" that will affect your claim. New York’s statutes of limitations control the time within which you can sue your contractor. From a public policy perspective, the goal is to encourage citizens to resolve claims quickly, to give individuals and businesses a sense of security from legal liability.
The most common legal causes of action against a contractor tend to be breach of contract (“He promised to fix my kitchen sink for $500, but it cost me $1,500 and it still leaks!”) and property damage (“She broke the pipes in my bathroom when she was supposed to be retiling the floor!”).
New York has a six-year limit under N.Y. C.P.L.R. § 213(2) for breach of contract, and a three-year limit for property damage under N.Y. C.P.L.R. § 214(4). These amounts of time can seem lengthy, but they pass by quickly if you spend too long negotiating with your contractor before filing suit. Be sure to preserve your rights!
Like all states, filing a lawsuit in the Empire State is not free. You will pay about $65 (as of 2015) to issue a summons to your contractor and file a complaint against him. You’ll also pay additional fees if you need to issue subpoenas (for example, to third-party witnesses) or get an official court transcript. Moreover, you’ll need to pay for copying exhibits and documents, which you will present as evidence. Generally, you should set aside a few hundred dollars from the beginning as an investment in your case.
Next, you’ll file a Statement of Claim with your county clerk. This is essentially an informational sheet for the court system: You’ll need to provide names, addresses, and phone numbers for both yourself and the defendant contractor (or the business entity name). You’ll then need to describe your claim.
Finally, you’ll indicate the amount of money you believe you are owed. Don’t exaggerate. Remember, you’ll need to substantiate every dollar that you are claiming, and losing your credibility with the judge is not a wise move.
Court clerks are helpful resources, but be aware that they cannot give legal advice; many are not attorneys. If you feel that you do need some additional guidance on filling out the various forms, New York’s court system provides a helpful video, and the New York City Bar Association (a nonprofit organization of lawyers) provides a helpful guide.
Once you’ve filed the summons and complaint, you’ll need to make sure the defendant is officially served with a copy of the lawsuit and that proof of service is filed with the court. A court clerk can help you find a process service company to do this for you. This generally means that a process server will physically find the defendant and hand him a copy of the papers. While this seems like a technicality, failure to properly serve the contractor could result in dismissal of the case.
Next, your contractor will have an opportunity to file a document called an Answer. Like your Claim, this is a short form that allows the contractor to tell his or her side of the story.
Finally, the clerk will send both you and your contractor a notice of a date to come to court. This is when you will see the judge.
However, before you see a judge, the court staff may encourage you to try to settle your case through mediation. In mediation, a trained third-party neutral will sit down with you and your contractor and help you to negotiate an agreement, without the need for a trial. New York’s court system is a leader in alternative dispute resolution, and partners with the world-renowned Mediation Clinics at Cardozo Law School and Columbia Law School to provide free mediation services. These services are worthy of consideration; if you can’t reach an agreement, you’ll be no worse off than you were before.
A band wouldn’t play Madison Square Garden without rehearsing its set. Similarly, you shouldn’t “perform” in front of a New York judge without preparation. Even for trained lawyers, standing in front of a judge can be nervewracking. You can easily forget dates, documents, and requested damage amounts.
Practice what you will say in your one to two minutes speaking to the judge by rehearsing in front of a friend or family member. Delete extraneous details. Remember, New York courts are extremely busy, and judges have heavy caseloads. Make the judge’s job easier by keeping the story short, simple, and to the point.
The evidence you present is another key aspect of convincing a judge of the merits of your claim. In the context of home improvement contractor litigation, evidence is crucial to avoiding a he-said/she-said situation, where you and your contractor simply disagree on whether or not the contractor properly performed the agreed-upon duties.
Typically, the most important evidence will include: 1) Any written contracts between you and the contractor outlining the work he promised to perform, the timeline for performance, and the payment agreed upon; 2) Any proof of money transferred from you to the contractor, showing how much money you’ve already paid; 3) Any emails or letters you’ve sent to the contractor outlining your dispute; and 4) Photographs of your home before and after the construction work, especially photos that show shoddy workmanship.
Depending on circumstances, you might also bring witnesses with you to court to describe elements of the story to the judge.
First of all, it’s possible that your contractor may offer to settle with you before trial. Being served with a lawsuit is annoying, particularly for a small business, and your contractor might realize the lawsuit isn’t worth fighting. If you are able to come to a settlement, you and you contractor can fill out and file this Stipulation of Settlement. This document will notify the court that your case is effectively closed.
If you win your lawsuit, you’ll receive a “judgment.” This indicates that you are owed a certain amount of money – perhaps everything that you asked for, or perhaps a percentage of what you asked for. What if your contractor ignores the judgment and never actually pays you? Through post-judgment proceedings, you will be able to attach (formally lay claim to) any assets (such as bank accounts or vehicles) owned by your contractor in the amount of the judgment.
Unfortunately, this isn’t automatic. It will require that you return to court and fill out more paperwork, specifically “information subpoenas,” which are used to locate the contractor’s assets. While New York’s court system provides some resources on how to collect the judgment, it will ultimately be your responsibility, as the winning plaintiff, to work with the court system and retain a third-party collections company.