The Houston Sheriff’s Office recently announced the arrest of the principals of Kriser Homes who have been charged with fraud regarding residential construction in the Houston area. As stated:
“In a live news conference, Houston County Corporal Brandon Barnes revealed that, throughout the investigation, officials found fraudulent and forged documents including certificates of occupancy, building permits, sewage inspections, and termite bond records.”
Given that this matter will be set for trial, and everyone is entitled to a presumption of innocence and due process, I will not comment on the merits of this case. However, the fraud pattern applied to this Houston Home Builder who allegedly defrauded Houston Home Purchases is frequently encountered in many of my construction defect cases across Texas.
As a Houston Construction Lawyer of many years, I have been bombarded with cases of not only incompetent and deficient home residential construction but outright fraud. My clients are astonished by how prevalent this problem is. Home construction fraudsters are everywhere so…. Caveat Emptor (buyer beware!).
Typically, in these cases, homeowners or purchasers are so excited about the prospects of a new home or renovation, that they fail to focus on the details including the proper selection io the contractor. Here are a few recommendations:
- Verify the qualifications of the contractor. The best option is to have a qualified person run a criminal background check. You can also search the Texas judicial records to determine if lawsuits have been filed against the potential contractor. A lien search is also recommended when the contractor fails to pay his/her subcontractors for work performed forcing the unpaid vendors to file a lien on the Houston homeowners’ property. Such record evidences the potential existence of fraud and even criminality.
- Get a Houston Construction Lawyer involved in the beginning. If a small job is involved, it is not feasible to pay for a Houston construction attorney. However, when a larger contract is involved such as the purchase of a new home or major renovation it makes sense to have an experienced Houston construction attorney review the legality of the agreement and determine whether it contains “legal land minds”.
- If fraud is involved, there are many remedies to pursue. The point is to move rapidly to get a judgment against the fraudster and recover assets while they are available. In a typical situation when the contractor had no intent to perform, the claim of fraudulent inducement is available under Texas law which allows for a recovery of damages not just against the defrauding company but the contractor personally. That is a very powerful weapon in the legal arsenal. Other claims involve violations of the Texas Deceptive Trade Practices Act (DTPA) which allows for a trebling of damages if fraud can be established.
- Getting the fraudster thrown in jail may offer emotional relief but it usually doesn’t help the victim’s pocketbook. Jail time does not necessarily lead to a big civil payout which can be obtained in civil court and seizing assets.
- In many instances, the underlying construction defects may have resulted from strictly inexperience, incompetence, or horrible business management. In these cases, a myriad of effective remedies are available to damaged Houston homeowners. These include filing for relief under the Texas Residential Construction Liability Act (RCLA) which provides a mechanism for construction disputes to be resolved without court action and reduced expenses. If available, this is a preferred option and can easily be explained by an experienced Houston construction attorney.
At the Moster Law Firm we enjoy advising clients on construction defect issues. We are available for a complementary consultation including a document review and assessment.