Getting Paid

When an owner awards the construction contract to the general contractor and issues the Notice To Proceed, everyone is eager to start the physical construction at the jobsite, and they immediately gather up the labors and the materials necessary to begin the work.  As the demolition starts, and the backhoe begins the excavation, the contractor, subcontractor and the material suppliers are excited about the possibility of a new and profitable project, especially during a slow construction market.  During this time, no one is concerned about, or anticipates future litigation.  As a result, the members of the construction team, i.e. those who provide labor, services, equipment and material to the jobsite, sometimes neglect to properly investigate the players and the project prior to the start of the work, and fail to obtain information that could be useful and sometimes necessary for dispute resolution and collection activities when the project goes unpaid.  

 

With today's technological advancement, information about parties and construction projects are often times available online and at your fingertips.  Below are a few useful online resources:

 

1.  Secretary of State Website (www.ss.ca.gov): The SOS website allows you to investigate your customer's business history, determine if the entity is a corporation, a limited liability company or a limited partnership, identify when the business was formed and whether it is a domestic or out-of-state business, the entity's status (active/suspended/dissolved) along with identity of the agent for service of process if notice or service is required. The SOS's information is useful in identifying the business' contact information and in evaluating the risk of doing business.

 

2.  California Contractors State License Board (www.cslb.ca.gov): The CSLB website provides information about a contractor, including the date and type of license issued, the status of the license (active/inactive/expired/suspended), workers compensation insurance information and history, complaint disclosures and disciplinary history, and information about the contractor's license bond surety. This information is useful in determining whether an entity is properly licensed.

 

3.  Social Media: These days, most businesses have some kind of online presence through social networking sites, whether that be via Facebook, LinkedIn, Twitter,  Instagram, Pinterest, Vine, Flicker, YouTube, Snapchat or your customer's own website.  There is a lot of information that can be found about people and business entities through social media that can be useful (or scary) in determining the stability and viability of a potential individual or entity customer.

 

4.  Google Searches: Google searches, including "advance" and "reverse" searches can reveal information that would otherwise not be easily found. Furthermore, "Google Alert" is a useful tool that once set up, sends automatic and periodic e-mails notifying you of news and updates about topics/people you want to track.  For example, if you want to track a high profile construction project, or a developer or an investor,  you can assign search terms, keywords and phrases (the Project name, address, developer) for Google Alert to track for you.  After it is set up, you will receive email notices every time there is a development or article or mention of your search terms.  In essence, it is an ongoing customized search which delivers search results automatically to your email inbox.

 

5.  Public Records Search: Through various websites, such as the Superior Court websites and Pacer, you can search for information about bankruptcy filings, pending lawsuits, prior judgments, tax liens, and/or criminal records. 

 

6.  Property Information: To properly serve Preliminary Notices, and/or Stop Payment Notices and/or Mechanic's Liens, websites such as Zillow, Google Maps, and the Los Angeles County Assessor's online helpdesk can provide information about the property owner and the property Assessor's Parcel Number.  Additionally title searches can reveal the name and contact information of owners and construction lenders and identify existing loans, construction deeds of trust, and existing mechanic's liens.

 

With the above resources, there is no excuse for failing to investigate the players and the project in advance of work starting and for failing to take advantage of the available (usually free) resources!