Dealing with Subcontractor Problems

No matter how well you vet, hire, and manage subcontractors, problems will arise. It's not if, but when. How you handle these problems determines whether they're minor bumps or project-killing disasters.

This guide covers the most common subcontractor problems owner-builders face, how to prevent them, how to address them when they occur, and what legal options you have when things go seriously wrong.

The Reality of Construction Problems

Expect problems. Even on well-managed projects with quality contractors:

The difference:

Your job: Handle problems professionally, document everything, enforce contract terms, protect your interests

Common Subcontractor Problems

1. Schedule Delays

The most common problem: Contractor not showing up or finishing when promised

Causes

Legitimate delays:

Problematic delays:

How to Address

For legitimate delays:

Step 1: Get information

Step 2: Document

Step 3: Adjust schedule

Example email:

[Contractor],

Thanks for notifying me about the rain delay. I understand framing
can't proceed safely in these conditions.

Per our contract Section 8, weather delays extend the completion
deadline. I'm adjusting the schedule:
- Original completion: June 15
- New completion: June 18 (3-day extension for weather)

I've notified the electrician that rough-in will now start June 19
instead of June 16.

Please confirm you can resume work on June 11 when weather clears.

Thanks,
[Your name]

For problematic delays:

Step 1: Address immediately

Step 2: Set clear deadline

Step 3: Document in writing

[Contractor],

Per our phone conversation today, you committed to:
- Return to site Monday, June 10 with full crew
- Work full days until completion
- Complete all framing by June 20

Our contract requires completion by June 15. This delay is costing
me $200/day in extended construction loan interest and delayed
trades (per contract Section 9).

If you cannot meet the June 20 deadline, please let me know
immediately so I can make other arrangements.

[Your name]

Step 4: Enforce contract terms

Step 5: Make the call

Decision criteria:

Prevention

During hiring:

During work:

2. Quality Issues and Defective Work

Second most common: Work doesn't meet code, contract, or quality expectations

Common Quality Problems

Framing:

Plumbing:

Electrical:

Drywall:

General issues:

How to Address Quality Issues

Catch early (best option):

During work:

Address immediately:

Example conversation:

"I notice these walls aren't plumb. The plan calls for walls to be plumb and square per IRC. How do you plan to correct this before we proceed?"

At inspection (still fixable):

If inspector catches it:

Contract language to use:

"Per our contract Section 6, all code violations and failed inspection corrections are at your expense. Please make the corrections and call for re-inspection. Payment will process after passing inspection."

After work covered (expensive):

When you discover:

Discussion approach:

"I've discovered [issue] with the [work]. This doesn't meet [code
requirement / contract specification / industry standard].

To fix this properly requires [specific correction].

Per our contract warranty section, this needs to be corrected at
your expense. When can you address this?"

Contractor responses:

Good response: "You're right, I'll fix that this week at no charge."

Defensive response: "That's not a problem, it's fine."

Refusing response: "That'll cost extra" or "It passed inspection."

Prevention

During hiring:

During contract:

During work:

3. Scope Disputes

"I didn't think that was included": Disagreement about what contractor should do

Common Scope Disputes

How to Prevent

Crystal clear contract scope:

Example (prevents disputes):

INCLUDED:
- Hang all drywall per plan
- Tape, mud, and finish all joints to level 4 finish
- Sand and prime all surfaces
- Clean up debris daily
- Remove all waste materials

NOT INCLUDED:
- Texturing (by owner)
- Painting (separate contract)
- Repair of structural issues found during hang

How to Resolve

When dispute arises:

Step 1: Review contract

Step 2: Discuss professionally

Step 3: Determine who's right

Step 4: Resolution

Document resolution:

[Contractor],

We discussed the [disputed item] today. After reviewing the contract:

[Your position and reasoning based on contract]

[OR]

We agreed the contract is unclear on this item. We'll resolve it as
follows: [resolution]

Please confirm your agreement.

[Your name]

4. Communication Problems

Symptoms:

How to Address

Minor communication issues:

Serious communication breakdown:

Step 1: Document attempts

Step 2: Formal written notice

[Contractor],

I have attempted to reach you:
- [List dates and methods]

I need response to the following urgent matters:
- [List issues]

Please respond within 24 hours. Continued failure to communicate is
a breach of our contract and may result in termination.

[Your name]

Step 3: If still no response

Prevention

5. Contract or Abandons Job

The nightmare scenario: Contractor stops showing up

Warning Signs

What to Do

Step 1: Document absence

Step 2: Formal notice

[Contractor],

You have not been on site or communicated since [date], despite
multiple attempts to contact you.

Per our contract Section 10, failure to perform work without valid
reason for 5 consecutive business days constitutes abandonment.

You have 48 hours from this notice to either:
1. Resume work with full crew and commitment to complete, OR
2. Provide valid explanation and proposed resolution

Failure to respond will result in contract termination and hiring
of replacement contractor to complete your scope.

[Your name]
Sent via: Email and certified mail

Step 3: Termination (if no response)

[Contractor],

Due to your failure to respond to my notice dated [date] and your
abandonment of the project, I am terminating our contract effective
immediately per Section 10.

I have hired [Replacement Contractor] to complete the remaining work.

You are owed $[amount] for work completed to date, minus:
- $[amount] cost to complete your scope
- $[amount] damages per contract terms

Final accounting: [You owe me $X] or [I owe you $X]

Please remove all tools and materials from site within 5 days.

[Your name]

Step 4: Hire replacement

Step 5: Final accounting

Most scenarios: Cost to complete exceeds what you owe them, so you owe nothing

Legal options: Sue for damages (see below)

6. Safety Violations

Dangerous situations on your property

Common Safety Issues

How to Address

Immediately:

Document:

Follow up in writing:

[Contractor],

Today I observed [unsafe practice]. I directed you to stop immediately.

Safety is non-negotiable on this site. All work must comply with
OSHA requirements and safe work practices.

Any future safety violations will result in work stoppage and possible
contract termination.

[Your name]

If repeated:

7. Damage to Other Work

Contractor damages completed work by another trade

Examples

How to Address

Immediate discovery:

Later discovery:

Communication:

[Contractor],

I discovered damage to [item] caused during your work on [dates].

[Photo attached]

Per our contract Section X, you're responsible for damage caused by
your work. Please repair or replace at your expense by [date].

If you disagree about responsibility, please respond within 2 days
so we can resolve.

[Your name]

If they repair: Great, document completion If they refuse: Deduct repair cost from their payment or hire others and back-charge If can't determine who: May need to accept as cost of construction

Prevention

8. Payment Disputes

Disagreement about how much is owed

Common scenarios:

How to Address

Step 1: Review contract

Step 2: Document your position

Step 3: Communicate

[Contractor],

You requested payment of $[amount] for [milestone].

Per our contract, this payment is due when:
- [List milestone criteria]

Currently complete:
- [List completed items]

Still required for payment:
- [List incomplete items]

I'm ready to process payment within 5 days of completion of the
items above. Please let me know your timeline to complete.

[Your name]

Step 4: Negotiate if needed

Step 5: Legal options if can't resolve (see below)

When to Fire a Subcontractor

Difficult decision, but sometimes necessary

Fire Immediately If:

Fire After Warning If:

Don't Fire If:

How to Fire Properly

Step 1: Review contract termination clause

Step 2: Document cause

Step 3: Formal termination notice

[Contractor],

Due to the following material breaches of our contract:
1. [Specific breach with dates]
2. [Specific breach with dates]
3. [Specific breach with dates]

And your failure to cure these breaches after notice dated [date],
I am terminating our contract effective immediately per Section 10.

Financial accounting:
- Contract amount: $[total]
- Paid to date: $[amount]
- Work completed: $[amount]
- Owed to you: $[amount]
- Cost to complete: $[amount]
- Net: [You owe X] or [I owe X]

Please remove all tools, materials, and equipment from site within
5 business days.

[Your name]

Step 4: Secure site

Step 5: Hire replacement

Legal Options

When problems can't be resolved through communication

Small Claims Court

For: Disputes under $5,000-10,000 (varies by state) Cost: $50-200 filing fee Time: 30-90 days to hearing Lawyer: Not required (sometimes not allowed) Outcome: Judgment, but still must collect

When to use:

Process:

  1. File claim at county courthouse
  2. Contractor is served
  3. Both parties present evidence at hearing
  4. Judge decides
  5. Winner gets judgment

Winning doesn't mean collecting: Must still enforce judgment

Mediation

What it is: Neutral third party helps you negotiate

Cost: $200-500 for mediator (split with contractor) Time: 1-2 hours Outcome: Agreement (if successful) Binding: Only if you both agree to terms

When to use:

Success rate: 70-80% if both parties attend in good faith

Arbitration

What it is: Private judge makes decision

Cost: $500-5,000+ depending on complexity Time: 2-6 months typically Outcome: Binding decision Appeal: Very limited

When to use:

Pros: Faster than court, expert arbitrators Cons: Expensive, binding (can't appeal), no jury

Lawsuit (Litigation)

What it is: Formal court process

Cost: $5,000-20,000+ in attorney fees Time: 1-2 years minimum Outcome: Judgment Appeal: Possible but expensive

When to use:

Reality: Expensive and slow, only for significant disputes

Contractor License Board Complaint

What it is: File complaint with state licensing board

Cost: Free Time: 3-12 months investigation Outcome: Contractor discipline (fine, suspension, revocation)

When to use:

Process:

  1. File complaint with licensing board
  2. Board investigates
  3. Hearing if substantiated
  4. Board disciplines contractor

Limitation: Won't get your money back, but contractor may be motivated to settle

Find your board: "[Your state] contractor licensing board"

When Legal Action Makes Sense

Consider legal action if:

Skip legal action if:

Before suing, ask yourself:

Preventing Problems

An ounce of prevention...

During Hiring

During Work

Best Practices

Reality: Problems still happen, but you'll have fewer and handle them better

Problem Resolution Checklist

When any problem arises:

When to Get Professional Help

Consider hiring attorney if:

Cost: $200-400/hour typical Value: Can save you more than they cost

Initial consultation: Many attorneys offer free 30-minute consultation

Real-World Examples

Example 1: Framing Delay

Problem: Framer scheduled to complete June 15, still working June 25

Cause: Under-estimated time, took another job mid-project

Resolution:

Lesson: Firm deadlines with consequences work

Example 2: Failed Electrical Inspection

Problem: Electrical rough-in failed with 8 violations

Cause: Electrician didn't know recent code changes

Resolution:

Lesson: Don't pay until inspection passes

Example 3: Contractor Abandonment

Problem: HVAC contractor stopped showing up after 60% complete

Cause: Took larger commercial job, ghosted owner-builder

Resolution:

Lesson: Document everything, follow contract termination process

Mental Approach to Problems

Mindset matters:

Stay Calm

Be Solution-Focused

Document Everything

Follow the Contract

Know When to Cut Losses

Learn from Each Problem

Summary

Problems will happen: Accept this reality

Most are solvable: With communication and professionalism

Prevention is best: Vet well, contract well, manage well

Document everything: Photos, writing, dates

Follow your contract: It's your protection

Know your options: Communication → Formal notice → Termination → Legal action

Stay professional: Emotions don't help

**Cut losses when needed