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Lucy, Esq.
Lucy, Esq., Attorney
Category: Legal
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Experience:  Lawyer
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I'm in a situation as follows.... (Los Angeles) I am a

Customer Question

I'm in a situation as follows....
(Los Angeles)
I am a fairly young sole proprietor fabrication business,with not a whole lot of bankroll to use as cash flow.
Client(tv studio) hired us to design and build environmental decor, furniture, and sculptures for a scheduled tv event. They hired us through a planner they had subcontracted.
An invoice was sent for 30k+, half was paid up front. Final balance due on event date(early April) there were no signed contracts at the time.
4 days before completion we were notified that the event was postponed with a future date unknown. They agreed via email to pay us 500/month to store the unfinished product in our warehouse, including the backed rent of June and July.
At the end of April they told us they lost their investors and weren't sure when they could pay us. After three months of attempting to get them to pay and finally threatening legal action they paid us( end of July)
This cash flow deficit(it wasn't a very high profit job) hurt us financially and actually prevented us from being able to take on a few jobs that crossed our table.
At that time they proposed an 18 month window to complete with a 3 month warning and complied that they would pay the additional 5-6k for us to complete the project. (Not having the full payment in april meant we had to release the contractors and pay them out) We have to rehire the contractors to help finish the build and painting)
We sent them an updated contract including the new terms and rental agreement included. We also required a signature as we didn't want a repeat of last time. The new contract also has late charges that Can be applied at our discretion.
They never sent it back and have dodged every email, phone call, etc. They owe us almost 5 months of rent(first and last were required up front)
What can I do? I would be happy to let them take the materials( though worthless until completed) and have them pay us out the backed rent, or I could even repurpose them and call it a wash. But I don't know how the rules apply in a situation like this, fabrication contract+rental.
I haven't been able to get a single lawyer to call me back and I've left messages with at least 30 offices. I reached a real person at one and after hold time she said it wasn't worth the lawyers time and that he said go to small claims, however I want to know what's what before I put time into that long process.
One friend said we might be able to get a mechanics Lien. ???
I would appreciate any advice you can offer.
Submitted: 2 months ago.
Category: Legal
Expert:  Lucy, Esq. replied 2 months ago.

Hi,

I'm Lucy, and I'd be happy to answer your questions today. I'm sorry to hear that this happened.

How much is the rent they still owe you? Did they pay everything except the rent at this point?

Customer: replied 2 months ago.
2500 at this point, but they withheld almost 13k last time and i dont want it to get to that point again.they havent responded in almost 2 months
Customer: replied 2 months ago.
any advice?
Expert:  Lucy, Esq. replied 2 months ago.

I apologize for the delay, as I typically am not online after 5 pm EST on Fridays.

You have the ability to serve them with a 3 day notice to pay the rent owed or vacate your warehouse. If they pay, then you can serve them with a 30 day notice to vacate. If they don't pay, you can go to court seeking a judgment that they must leave, plus a judgment for the $2,500. You'd be able to request a lien on the inventory being held in the warehouse, and if the judge grants it, the items can be sold to pay what they owe you.

A mechanic's lien is appropriate if the money they owed you was for the work done on their studio. However, there are multiple notices that must go out to perfect your right to a mechanic's lien, starting with when you begin the project. Also, the money they owe you now isn't for the studio - it's for renting your warehouse. So there wouldn't be a mechanic's lien on the studio.

You do not need a lawyer to represent a sole proprietorship (and in Small Claims Court, you couldn't have one). The state has more information on their website, including forms:
www.courts.ca.gov/selfhelp-eviction.htm

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Customer: replied 2 months ago.
if they vacate the premesis can they take their stuff if they have not paid(it's only half built product at this point)?Also if they request we finish the job and were to take possession of the product due to the 3 day or quit, are we required to finish it even if they don't pay the backed rent?The agreement was they had to pay an additional 5400 for us to finish and give us a 3 month notice to complete within 18 months of the agreement, however they still haven't signed the contract.
Expert:  Lucy, Esq. replied 2 months ago.

You can refuse to finish the job until they pay you. They're in breach of the contract, so you don't have to finish the work. They are allowed to take their stuff and go so you can get your space back, but if you'd rather get paid, you can sue for the lost money and not evict them. That's entirely your choice as the property owner.

Expert:  Lucy, Esq. replied 2 months ago.

Do you have any other questions about this?