Contractor violating Home Improvement Act by asking for 50% deposit

Q: I’m a regular reader of your Saturday-turned-Friday newspaper column and I’ve always appreciated your wisdom and advice. I know you’ve written about swimming pools before, but now I have a unique problem. I’m trying to get a swimming pool built in my backyard and I’m having a heck of a time with the city. My backyard overlooks a valley below and so I figured the pool and the view would be breathtaking. I hired a pool company to design the pool and other things like an outside kitchen and cabana. The company quoted me an all-inclusive price for everything. We signed the contract and I gave them 50% of the money up-front. But when they went to the city to pull the permits, the city told them I wouldn’t be able to build without a soil engineer signing off on the job. They were concerned the project could cause the hill behind my house to slide down. The pool isn’t that big and I think the city is entirely overreacting. The pool company said the cost of the engineer wasn’t covered by our contract and so I paid over $5,000 for a soil engineer to do drillings and tests and give me a report. His opinion was that I could do the project but would have to build a retaining wall with an estimated cost of almost $80,000! That’s way over my budget. So I contacted the pool company and told them I was cancelling the pool and wanted my money back. They told me they would cancel, but all the money I gave them covered the work they did so far and the rest was damages for backing out of the contract. At this point I don’t know what to do.

A: Well, if you want my wisdom on the issue, I wouldn’t build a pool in the first place. We had a pool when I was a kid and I was the sibling that always had to clean it even though we hardly ever used it. I’m still bitter. But that’s me.

The pool construction business has been, over the years, filled with every type of flim-flam man. In response, the Legislature has passed many consumer protection laws for homeowners just like you.

First of all, the company can only take a deposit of 10% of the contract price or $1,000, whichever is less. They demanded, and you paid, way over that amount. That puts them in violation of the Home Improvement Act.

So for starters, there are two things you need to do immediately.

First, contact the California State Contractors License Board and file a complaint. Generally, the CSLB is pretty quick to move on something like this, which could result in the contractor losing his license, a fine and even jail time.

Next, contact an attorney about filing a lawsuit to get your money back.

Once you file a lawsuit, the CSLB will often put everything they’re doing on hold while you try to get your money back in court. And sometimes it’s faster to just let the CSLB do its job, so talk it over with your lawyer.

You are absolutely entitled to your money back. Your pool contractor should have recognized from the start that an engineering report was going to be necessary and advised you of that.

These kinds of problems crop up with surprising frequency. The contractor should have done nothing pending the permit issuance.

Good and experienced contractors can usually judge when they may have a problem with the city’s Building Department and prepare their customers for it.

Building a pool on what amounts to a bluff with, what I presume to be a steep cliff just feet away, would qualify as one of those foreseeable problems. It certainly isn’t the Building Inspector’s fault. It’s a safety issue of exactly the type which gave rise to building codes in the first place.

I’m sorry you got nailed by a bad contractor. There are a lot of them out there, but many more good ones. The trick is trying to tell them apart.

Tim Jones is a real estate attorney in Fairfield. If you have any real estate questions you would like to have answered in this column, you can contact him at [email protected]