[quote=“dougger222”]Sounds like a storm chaser contract? My brother has been able to talk a few home owners out of these “contracts” with home owners over the years and none have been “sued”.
In doing so, your brother committed an act of tortious interference which caused the HO to illegally breach their perfectly legal contract for which both you and the HO could be sued. Presumably, he then did the work for substantially less then the SC’r would have done it for.[/quote]
I tried to convince a home owner once to do the same but his lawyer said his wife messed up with signing with a storm chaser. The contractor wanted 20% to back out which on a $38K roof was too much to risk.
If the SC’r was competent and did quality work, the wife didn’t mess up and the HO’s lawyer did the right thing (for once) by recommending to the HO’s that they abide by their legally enforceable agreement. Local contractor(s) who talk against the contingency process because they don’t understand it lose millions across the country every year to SC’rs who do understand it and come into anytown, USA and write a majority of the storm repair business for big legitimate profits. Now, if the local guys in each city took the time to learn the process, they’d level the playing field and the SC’rs would move on - and the average per job prices and profits for the locals would increase dramatically.
$7,500 roof? Move on to bigger and better things. I think in Minnesota they just changed the law and these types of “contracts” won’t hold up in court. quote]
No, Minnesota did not change the law, at least not in the way you imply here. All the “law” (326B.811) says is that if the HO’s insurance company denies the claim (deny would mean 0$), the HO has the right to cancel within 72 hours from the time they learn of the ins co denial and the contractor must return any monies paid to them within ten days of the date the contractor receives the cancellation notice. Doesn’t specify whether contingency or other contract. In fact, as written, only really speaks to non contingency contracts since with contingency agreement, no money is accepted until HO knows claim has been approved.
Then there’s the ole’ attorney opinion given out to HO’s whose contractors get them paid full RTA pricing and the HO attempts to cancel “those contracts (contingency agreements) that aren’t worth the paper they are printed on” so the HO can go with a free estimate guy for less $ and the HO can defraud the ins co. Bad idea on the part of the HO and the attorney.
The attorneys “legal reasoning” behind “not worth the paper they are printed on”? Because they are an “open” contract with no work description and no pricing. The implication being that the contractor is free to write in anything they want and steal from the HO. That, of course, is pure nonsense since, in reality, when the HO signed the contingency (and is given three business days in which to cancel from that date) they were informed by the contractor that the contingency and the ins co loss report are made one once the ins co has approved full payment. The line item and pricing are transferred from the loss report to the contingency agreement that converts to an enforceable contract. Nobody’s fooling anybody there. Any argument to the contrary is specious and nonsensical…transparent and just plain silly.
Then there’s that silly “rule” bulletin that now ex insurance friendly commerce commissioner Glenn Wilson and now ex DLI commissioner Steve Sviggum put out last September that implied that contractors who negotiate on behalf of HO’s with damage would be in violation of PA laws and rules and therefore subject to fines, penalties, etc. Both agencies have been doing a tremendous amount of back peddling on that one ever since they realized they had crossed over the line far past what any objective person would perceive as being reasonable.
Departments of Commerce and DOLI’s along with clueless legislators in a number of states (IL is high on the list) are playing the same and similar games. Ins restoration is a specialty that requires substantially more knowledge than is required to simply estimate and contract for normal retail work. When a contractor takes the time to aquire that knowledge, they put themselves years and profits ahead and no longer concern themselves with the out of stater’s.[/size]