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Loren, Attorney
Category: Legal
Satisfied Customers: 34027
Experience:  30 years experience representing clients.
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I recently did a sizable insurance restoration job for a client

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I recently did a sizable insurance restoration job for a client who has defrauded my company. We signed a contract guaranteeing us all insurance approved repairs at the insurance line item pricing (Xactimate). After the initial settlement and upon commencement of work, the homeowner insisted that the insurance company was paying for additional damage (Including all the walls/ceiling/trim in the living room and several other rooms). We sent in our estimate to the insurance and he told us it was approved and to finish the job. Several times, he threatened to trash our reputation if we did not finish the job on his terms and in his timing, rather than waiting on the insurance adjuster's revised settlement letter and check. Other times, he threatened to report us for insurance fraud if we do not comply with his wishes, because he insists the garage ceiling insulation was never replaced (even though we knocked out drywall to pull the new insulation down to show him it was actually done.) BotXXXXX XXXXXne, we let him string us along. When the final settlement came from the insurance company, they paid to "spot paint" some of it and completely ignored the rest of it. BotXXXXX XXXXXne, he scammed his way into over $20,000 worth of work at the insurance pricing.

Now that we have pulled the plug on the job, leaving him to find another contractor to do his carpet and attic insulation, he says the only way we will get paid for the roof, drywall work, and panting we have done is if we sue him. Am I able to recover the fair market value of the work that he defrauded us to complete, or only what the insurance company actually allowed for? In addition to breach of contract, do I also have a valid extortion, fraud, or blackmail claim against him?
Thank you for using JustAnswer. I am JudgeLaw and I will do whatever I can to answer your question and provide excellent service.

Before we begin, a bit more detail wold be helpful please.

What was the reason the insurance company would not cover the restoration work?

Did the contract provide for the owner guaranteeing payment?

Do you have any of his threats in writing?

Thank you.


Customer: replied 4 years ago.

They felt it was excessive. For example, they did not feel the trim or all of the walls needed painted.


The contract says "Upon adjustment of Owner's insurance claim, the value of such claim shall become the contract price, with the addition of any insurance supplements or additional costing of required work/materials. The value of such claim will be determined by current/local Xactimate pricing for all applicable line items, per industry standards. Please note that until your insurance claim is adjusted, price may be listed as 'To Be Determined.'"


While I do not personally have his threats in writing, I do have several material witnesses to the events, including but not limited to

1) My general manager who received these threats against my company personally

2) My painter, who had to call the police for the homeowner to give him back his tools. It is worthy of noting that he hired the painter for some additional work outside of our contract, and refused to pay him anything over the deposit once the work was complete. On top of that, he sent in writing (which I do have) that his expensive tools would not be returned until the homeowner had a check in hand for $300 refunding his deposit.

3) A police report was filed, where the homeowner promised in front of the officer to destroy my company and trash our reputation via Facebook

4) Another homeowner in the neighborhood informed us today that this very same homeowner did this to another contractor and never paid him for the extra work he had him perform.

5) An HVAC mechanic who told me that the homeowner wants everything for nothing

and 6) last but not least, the insurance adjuster has sided with me stating that the homeowner should have never promised us the insurance was paying for things that he did not yet have in writing. Furthermore, he needs to pay us for the extra work we have done. He has watched this homeowner try to get his entire house renovated by the insurance company for non-insurable reasons.


BotXXXXX XXXXXne, I am curious if enough material witnesses to his misconduct could help to secure a verdict.

Thank you, XXXXX XXXXX the additional information.

I am sorry to hear of your dilemma. I realize how frustrating this is for you, but I believe I have information which you will find helpful.

I believe you can make a claim for the market value of the materials and work provided. The basis for that claim is the line "...or additional costing of required work/materials." I would argue that the failure of the insurance to pay makes it "additional costing".

As far as blackmail, I do not think that is a claim you would likely prevail. You were under no compulsion to proceed and the damage he could have done is speculative.

The better claim is for the work done. There is also a legal principle called quantum meruit. That is where the defendant would receive a windfall which would be unjust for the plaintiff to bear, even though the terms of the contract may have been technically observed or if, for some reason, the contract is unenforceable.

It is my privilege to assist you. Let me know if you need further information.  I hope I have helped you beyond your expectations in the service I have provided to you.  I am here for you.

Please remember to rate my answer when our communication is completed so I will be compensated for my time in providing you with the information you requested.

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Thank you.

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