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On the day I was going to close the sale of a new house that I was
going to buy, I had a major flood in the basement. The seller (previous
owner) contacted his insurance and asked a Disaster Clean Up company to
do the work. Since I was away for a month, they took their time to fix
the house and put a new carpet. After almost a month they put a new
carpet, but I noticed there is some color change of the carpet which
they did not notify me. They came with an offer to pay me $600 since
they believed it was a carpet manufacture's problem. Since I did not
agree with their offer, they came back and said they will replace the
whole carpet. At the same time I noticed there were other issues with
the house they did not fix. I owe them money for 3 rooms carpet which
comes to $2000. Now they want this $2000 money after all the
negotiations failed. The funny thing is that they are now saying they
have only contract with the previous owner so I had to contact the
previous owner to fix this problem.
What can I do in this situation? Can I use the Previous Owner's
Insurance Company?
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frustrated wrote:
On the day I was going to close the sale of a new house that I was
going to buy, I had a major flood in the basement. The seller (previous
owner) contacted his insurance and asked a Disaster Clean Up company to
do the work. Since I was away for a month, they took their time to fix
the house and put a new carpet. After almost a month they put a new
carpet, but I noticed there is some color change of the carpet which
they did not notify me. They came with an offer to pay me $600 since
they believed it was a carpet manufacture's problem. Since I did not
agree with their offer, they came back and said they will replace the
whole carpet. At the same time I noticed there were other issues with
the house they did not fix. I owe them money for 3 rooms carpet which
comes to $2000. Now they want this $2000 money after all the
negotiations failed. The funny thing is that they are now saying they
have only contract with the previous owner so I had to contact the
previous owner to fix this problem.
What can I do in this situation? Can I use the Previous Owner's
Insurance Company?
If their contract is with the previous owner, tell them to collect the
money from the previous owner.
Let this be a lesson to you. Your error was in procedure and now there
is an unholy mixup involving insurance companies, you, the previous
owner and some cleanup company. The right way to proceed would have been
for you to demand a reasonable allowance for cleanup to come from the
proceeds or to be put into an escrow. Then you'd contract for the
cleanup so you'd be the contracting party and have standing in your
complaints.
This could get ugly if the previous owner comes back on you claiming you
accepted the house as is with his promise to do the cleanup as much as
it was done and to that standard. Since you haven't given details on the
agreement you had with the previous owner as to the damage, I can't
comment further.
-paul
ianal
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On 2/3/05 11:11 pm, in article 5thc219ggvisalovk9o0ccp222pdpo4pm0@4ax.com,
"Paul Cassel" <pcasselplustwo@comcast.net> wrote:
Let this be a lesson to you. Your error was in procedure and now there
is an unholy mixup involving insurance companies, you, the previous
owner and some cleanup company.
One has an insurable interest in property the moment one contracts to buy
it. In traditional English law the risk of loss (from fire, flood) was on
the buyer, so it was particularly important to insure forthwith. Modern
American contracts of sale of land are conditional, so the urgency isn't
there and I think few people do insure at that point.
More's the pity.
This is a contract matter: we don't know the circumstances under which they
provided services (supply of carpet) to you (based on your implicit promise
to pay), and other services to the seller (based on the policy). One problem
is that there seem to be two contracts, and you may not have a right of
setoff on your claim against the seller, who then claimed against his
insurer.
If this goes to court, you are going to need to get both seller and insurer,
and perhaps supplier of carpet, into court at the same time or you risk
inconsistent judgments (i.e., that nobody owes you anything). Such judgments
are less likely when everybody is before the court at once, in a single
case.
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Tam wrote:
On 2/3/05 11:11 pm, in article
5thc219ggvisalovk9o0ccp222pdpo4pm0@4ax.com,
"Paul Cassel" <pcasselplustwo@comcast.net> wrote:
One has an insurable interest in property the moment one contracts to
buy
it. In traditional English law the risk of loss (from fire, flood)
was on
the buyer, so it was particularly important to insure forthwith.
Modern
American contracts of sale of land are conditional, so the urgency
isn't
there and I think few people do insure at that point.
Thank you very much for the reply.
The contract with my previous owner was accept the house as it is. I
asked the previous owner to fix few items which he did. We verified
whatever he did. Then on the day of the closing this flood happened.
The flood happened after he repaired everything and left the AC off
which caused a pipeline to burst. Just hours before the closing, and
the
money transferred to my previous owner, the work started in my house
tearing the walls down and fixing the house. I did not have any
contract neither I signed any papers with the Insurance or the clean up
company. They were on their own. At that time since the Insurance was
involved, both of us (me and the Previous owner) believed Insurance
would take care of the demolition and building it. My real estate agent
did not tell me to sign a contract with them as he also believed this
is handled by the Insurance.
Let me clarify about the money the Clean Up company talking about. They
say that they have contract with the previous owner. From that what I
can understand is that I need to contact the previous owner for the
cracks, wrong carpet (except the rooms that I asked the Clean Up
company to put). I need to pay the Clean Up company for the carpet that
I asked them to put in 4 rooms. So, I can't say I don't owe them
anything except in one room out of 4 rooms they did not put the carpet.
Yes, they did not put the carpet in one of the 4 rooms that I asked
them to put. Doesn't that mean they did not complete the job?
When I contacted the Consumer Protection Agency of my state, the first
question they asked me was why did the Clean Up company started putting
the carpet if they did not have enough carpet. The Clean Up company was
highly tactical in getting the money from me. First they said they are
going to close the account. When I asked how can you close the account
without finishing the work, they said they are going to deliver the
rest of the carpet (which they did not put in one room) infront of my
house. Then I said you can't do that, they said they are going to
substract the amount from the total amount that I owe him. They started
all these tactics after saying the owner of the company is a 'Jerk'.
The surprise of all was why did they put the carpet and did not inform
me about the Manufactures problem. They cam up with an answer saying I
was not able to be contacted since I was away from the country at that
time. What they said is not true because they put the carpet when I was
available at my house. Unfortunately I did not notice the problem until
I moved in all the stuff into the house. Honestly they wanted me to
figure out the problem and report them so that they can blame it on the
Manufacturer.
Do I have the following options?
1. Can I ask the Clean Up company to come and take the carpet (that I
asked them to put in 4 rooms) back and replace my old carpet?
2. Can I sue the Insurance and the Clean Up company because they
accessed my house when the house was in my possion? That means doing
work in my house and making a mess when they did not have any contract
with me? As far as I know, the house key was given to them by the
Previous owner.
3. If the Clean Up company puts a lien on my house to collect the money
of $2000 from me (This is the first tactic they used), can I go ahead
and pay that amount and sue the Clean Up company for not to finish the
work (that means they did not put the carpet in one room and for
putting the wrong carpet)?
4. I got a message from the Insurance company that they are going to
come to my house and verify it. They are ready to pay me $150 for the
energy that is used during the construction. But they will give that to
me only through the Clean Up company as the Insurance does not have a
contract with me. Now I don't have any contact with the Clean Up
company, what can I do to get this money?
5. The Clean Up company sent me a letter. Do I need to respond to them?
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