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Law Educator, Esq.
Law Educator, Esq., Lawyer
Category: Real Estate Law
Satisfied Customers: 118252
Experience:  Licensed attorney practicing landlord-tenant, land use and other real estate law and litigation.
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In March, I sold a house in Iowa. There were still repairs

Customer Question

In March, I sold a house in Iowa. There were still repairs to be done to the house, including a new roof and other repairs, outlined in a contract with my Contractor X. I paid him 50% down, and provided a copy of the contract to the new home owners. Then, on the closing papers, I wrote: "I have provided the contracts regarding a new roof and repairs from US Bank and Country Mutual Insurance to the new owners of the house. Upon Completion of the sale of the home, the remaining amount will be released and sent to the new owners of the home, to be paid to the contractor upon completion of the repairs." --- Those repairs are still not done. The roof is done, but not the new garage doors. I have paid the Contractor X $15k, out of a $17k settlement I received from US Bank and Country Mutual. All he has to do is put the new garage doors on, but he does not have the money to buy the materials. The new owners are now asking me to pay them the remaining 2k and be done with it. My feeling is, we wait for my current contractor to finish the work, IF EVER. BEcause, I would then not owe him any more money because he said we'd be even. Or, does that statement I put on the Closing Papers even be legal? What do I do?
Submitted: 1 year ago.
Category: Real Estate Law
Customer: replied 1 year ago.
Files attached.
Expert:  Law Educator, Esq. replied 1 year ago.

Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.

You will have to sue the contractor for not doing the work as promised. Him not having the money to buy materials is no excuse, you paid him for a job and he has failed to perform. So if you do not sue the contractor, then your buyer can sue you for breach of your contract and can seek the damages from you for what it costs them to complete the repairs and then you would have to sue your contractor to complete the repairs.

If you just pay the buyer as they are asking, then you still have a contract you have to fight with the contractor because he is going to be looking for his $2000 as well. Thus, giving the contractor notice to perform or you will sue him for breach of contract is typically the best option.