Call Kurtis: Homeowner Sued Over His Contractor's Unpaid Bill

An El Dorado Hills man poured $101,000 into his dream pool, now he's getting sued and could even lose his home. Rafael Gallardo is on the hook because the contractor he paid to build the pool didn't pay a subcontractor. Call Kurtis looked into how other homeowners can avoid these types of situations.

The view of Folsom Lake from Gallardo's home is marred by the pool job that's turned into a nightmare. A few months ago, he learned a subcontractor had put a lien on his property because his contractor, Murphy's Pools of Folsom, didn't pay a subcontractor.

"That infuriated us. My wife went ballistic, I went ballistic," said Gallardo.

And now he's getting sued by the subcontractor for the $14,298 that's still due.

"I will not pay twice for something that a contractor was paid for," said Gallardo.

The pool sits unfinished, as Gallardo tries to decide how to move forward with Murphy's Pools.

"Frankly, I think sometimes homeowners, they don't realize that the contractors and suppliers do have a right to do this. And so then it comes and takes them by surprise," said Venus Stromberg, of the Contractors State License Board.

Stromberg says you can avoid being left on the hook by making out your check to not just the contractor, but the subcontractor too.

"So that both people, both the prime and the subcontractor both have to sign it in order for payment to be released," said Stromberg.

She also recommends getting your contractors to sign lien releases as work is completed. By signing those forms, the contractor is basically putting in writing that they got paid and they no longer have a right to place a lien on your property.

The owner of Murphy's Pools, Frank Murphy scheduled an interview with us, but backed out on the advice of his attorney. He claims the project went over budget, but couldn't explain why he didn't pay the subcontractors.

"I think I owe him about $5,000 more, but he's not going to see one penny of that until he's caught up and paid for everything," said Gallardo.

Murphy also claimed to be in talks to pay the subcontractor back, and finish Gallardo's pool this month. Gallardo doesn't have high hopes.

"If he doesn't come through, he will be served," said Gallardo.

Murphy's current license was recently suspended for not having the required $12,500 bond. That is a sort of an insurance policy to cover problems like this one. After getting a new bond, his license was reinstated. Gallardo is filing a claim on that bond.