Can a Cabinetmaker Repossess Work If Not Paid?

In most states you can't remove work that is installed into a home, even if you aren't paid. But there are other legal alternatives. June 3, 2007

Question
Has anyone had a customer refuse to pay, and have you threatened to remove or pick up the cabinets, and actually had to take the cabinets back? If so, did you run into any problems? Do you need to notify the police, or get a court order, or should I hire a repo company? Unfortunately, it looks like this is what it is going to come to, and I am not sure what to do.

Forum Responses
(Business and Management Forum)
From contributor S:
Careful - not sure about your state, but once cabinets have been fastened to the walls, they become part of the house. We had a GC that defaulted on several subs (he did about 20 houses a year) in more than one house. We were able to get the cultured marble vanity tops, but that was it. Filed a lien, but we were last in line. Good luck, and seek legal advice.


From contributor H:
I have it written in my contract that I have the right to remove the items if not paid for as agreed. We have not had to use it, but my attorney says anything is legal in a contract if both parties know and agree to it. In the last 30 years I have removed items that were not complete, even though they were installed, such as stair rail systems that were not joined, glued, and plugged. I brought them back after the client delivered a certified check to me. I have removed island cabinets and cabinets that did not have their doors mounted yet. I have also left cabinets but taken all the doors until I got a check. There can always be one door that just is not up to par and needs to be refinished, but it's best to redo them all so they match (get it?).

Laws vary by state and some of these things are a grey area. A client that is not willing to pay you will most likely not pursue legal action against you for removing things that they have not paid for.


From contributor M:
I can tell you what I know about this from the last time I looked into it. I am in Texas. The Assistant DA told me to talk to an attorney, but he said that once they are attached to the walls, they are considered "permanent fixtures" and cannot be removed without a court order. I asked about the doors, drawers, and adjustable shelves. He said that they could be removed with a court order, but it would have to be done by a constable and they must have either a serial number or my business name on them. I would not be able to accompany the constable to show him what was mine, and there must be some way for him/her to identify them.

If you can get the customer to let you remove these things, that would be fine. Otherwise, you might be charged with theft. Be very careful. A lien may be your best option. Talk to a construction attorney. There are many liens and each have different effects and requirements.

Need some encouragement to talk to an attorney? In Texas, if a residential project is over $5,000, you must have a construction account for that project. If it is over $20K, you must be registered with the state as a builder even if you are the subcontractor. Otherwise the customer can refuse payment and sue you for Deceptive Trade Practices and you wind up paying them. I don't know where you are, but I would be surprised if there were not backward laws that could hurt you in a situation like this. Good luck, and unfortunately, welcome to the club. I have a similar situation, and 3 years later, it might be coming to trial at the beginning of next year.


From contributor A:
I have a collections agency that seems to be real good. They got blood from a stone once. On the morning of the 16th, I'm giving them another stone.

From the original questioner:
Thanks. These are free standing desks in a business, so they are not attached to anything. The job got delivered out of state. I guess I will talk to an attorney.

From contributor Z:
Contributor M, I am also in Texas. Could you elaborate a bit? What is a construction account? How do you set one up? What state agency issues builder's permits? Thank God I have never faced a hostile situation, but you never know.

From contributor M:
"A contractor who enters into a written contract with a property owner to construct improvements to a residential homestead for an amount exceeding $5,000 shall deposit the trust funds in a construction account in a financial institution."

Texas Property Code Section 162

Talk to your banker. He should be able to set up a Construction Account for the person. You need to be able to track the money going in and the money going out. It is not a 2 party check system. This is your accounting.

--------
A person must be registered with the State of Texas as a builder if:
Sec. 401.003. DEFINITION OF BUILDER.
(a) In this title, "builder" means any business entity or individual who, for a fixed
price, commission, fee, wage, or other compensation, constructs or supervises or manages the construction of:
(1) a new home;
(2) a material improvement to a home, other than an improvement solely to replace or repair a roof of an existing home; or
(3) an improvement to the interior of an existing home when the cost of the work exceeds $20,000.

The state of Texas is the one who issues licenses. I don't think there is much to it. One of my attorneys said that you must pass the mirror test - you have to be able to fog a mirror placed under your nose. But nevertheless, it is one of those requirements.

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