May 7, 2016 • By Dennis Beaver
You might not have heard the term “Disaster Restoration Company,” odds are you have seen the excellent television commercials for three of the largest, Servicemaster, ServPro and DKI. All have high Better Business Bureau ratings, and excellent customer reviews, for most of us, calling one of them is the last thing we want to do.
For these are the people we phone when our property is damaged by wind, water, storm or fire, after reporting the loss to the insurance company, possibly even before placing that call.
Just imagine returning home from weekend away to a house filled with water from a broken pipe. These companies extract the water, immediately begin the drying process, treating or preventing mold. House fire? They save your soot-covered belongings, and on it goes.
Called by family members or apartment managers to clean a house or unit where the occupant was ill–or possibly died–restoration workers see the ugly things that most of us never do.
In late December 2015, 75-year-old Terry, living alone, became critically ill, fell into a coma and was hospitalized. “The days before relatives found him, life for the poor man must have been pure agony,” commented Eli, an employee of ServPro, the restoration company called by Terry’s daughter-in-law Pam.
“We had to wear Hazmat suits and use breathing devices. The trail of human waste — on the carpet, furniture and walls, on everything — told a story of a man completely unable to care for himself. It was so sad,” he explained.
Oddly, Pam told ServPro employees that she “Was not responsible and expected Terry’s homeowners policy to pay for the work.”
With Terry in the hospital, legally Pam’s signature was required on the work authorization contract which she took several minutes to read. One clause prominently stated, “If insurance does not pay, I agree to be responsible for the bill.”
She signed the contract, ServPro spent an entire day cleaning the apartment and its contents, but, as you’ve guessed, the bill was not paid. Instead, Pam’s husband phoned ServPro and “Went berserk, swearing, screaming and even denying that she signed the contract,” You and the Law heard the bizarre, ranting, messages he left.
As you’ll see, Pam and her husband face much more than just being sued for the bill, and they are not a unique couple.
We ran this situation by Attorney Ed Cross, based in Palm Desert, California. Known as “The Restoration Lawyer,” Cross represents restoration contractors across the country and has collected tens of millions of dollars on their behalf over the last 20 years.
“Our goal is to prevent people like Pam and her husband from ripping off these hard-working restorers who do heroic work, preventing mold, removing the soot, the smell of smoke, saving clothing and family photos. Often customers do not pay when the insurance check arrives, and keep the money!”
“Dennis, this is far more common than many people realize. Homeowners who play fast and loose with money that isn’t theirs, or who simply refuse to pay can end up paying double or triple the amount of the original invoice.
“When the bill is not paid, homeowners face suit for the amount owed, interest of 12% to 18% or more, court costs, and hefty Administrative Service Charges.
“Administrative Service Charges” Cross explains, “compensate the service provider for the time, labor expended in tracking, managing and accounting past due receivables. The amount of these charges is set by contract between the parties and will generally be enforced unless they are so excessive as to shock the conscience of the court.
“These charges can push the amount owed well over the contract price itself,” Cross points out.
“But it can get worse, much worse for a dead-beat customer, including being sued for fraud and the real possibility of losing the real property where the services were performed,” Cross points out.
“By asking someone to perform services, signing a work authorization and then denying responsibility, they have made a promise made with the intent to not pay. This dishonest behavior can result in an award of punitive damages for civil fraud.
“Finally, property owners must be aware that the law does not reward taking advantage of someone who helps to protect your property. If a homeowner refuses to pay the bill, a Mechanics Lien can be filed against the property.
“The result is that the property can literally be sold to pay the bill,” Cross warns.
His website is: www.restorationlawyer.com It merits a visit by the public, restorers and lawyers.
Dennis Beaver practices law in Bakersfield and enjoys hearing from his readers. Contact Dennis Beaver.