$150,000 Consumer Fraud Award Against General Contractor
Updated: Mar 8, 2022
Gordon & Lowman recently defeated a prominent New Jersey general contractor following a four day construction arbitration hearing stemming from a home rehabilitation project due to a house flood. The project involved a complete gutting and rehab of the property and the homeowners hired a well-known general contractor to complete the work. Midway through the project, the homeowners were unhappy with the general contractor's quality of work and slow progress. The homeowners then refused to pay an approximately $50,000 bill submitted by the contractor until he fixed certain aspects of the project. Rather than working with the homeowners to make the changes, the contractor hired a large law firm and initiated arbitration proceedings against the homeowners for breach of contract in addition to filing a construction lien against their property. The contractor sought more than $200,000 in damages for the construction lien, the remainder of the contract price, attorney's fees, interest, and costs.
The homeowners hired Gordon & Lowman to defend them. After inspecting the home and reviewing the evidence, Gordon & Lowman filed counterclaims against the contractor for violations of the New Jersey Consumer Fraud Act. Pursuant to the construction contract, the parties moved forward with a binding arbitration to resolve the dispute through a construction arbitrator certified by the American Arbitration Association.
The arbitration was conducted remotely via Zoom videoconferencing due to COVID-19. The attorneys at Gordon & Lowman cross examined the general contractor for nearly four hours during the arbitration hearing. On cross examination, the contractor admitted he billed the homeowners for work not completed and failed to include certain notices in his contract and work orders that are required by the New Jersey Consumer Fraud Act. Although Gordon & Lowman had prepared six witnesses, including an expert witness, to testify on behalf of the homeowners, the admissions they extracted from the contractor essentially proved their clients' case.
Based on the successful cross examination, Gordon & Lowman made a strategic decision to submit the case to the arbitrator relying solely on the contractor's admissions. Gordon & Lowman asked for the contractor's claims to be dismissed and argued their clients, the homeowners, were entitled to nearly $120,000 in damages and reimbursement of attorneys' fees and costs as the contractor's billing discrepancies and failure to include necessary notices on the contract and work orders violated the New Jersey Consumer Fraud Act.
The arbitrator ultimately ruled that the general contractor violated the New Jersey Consumer Fraud Act, dismissed the contractor's claims against the homeowners, and awarded the homeowners over $97,000 in damages plus attorneys' fees and costs. The total award exceeded $150,000. The homeowners were represented by Roy Gordon and Grady Lowman. The contractor was represented by a large national law firm with more more than 25 offices and 900 attorneys.
This case is an example of the powerful and expansive protections of the New Jersey Consumer Fraud Act and highlights the importance of general contractors keeping appropriate records, billing only upon completion of work, and including the proper legal notices in their contracts and work orders.
At Gordon & Lowman, we provide personal, attentive, and aggressive representation. If you are a homeowner, commercial property owner, builder, or contractor in need of advice on legal compliance or representation for a claim, please call for a free consultation.