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The owner won’t sign over the insurance check- HELP!

Hello Steve,

I hope all is well. I took SFS at Florida last year. I have a big problem with a huge water damage job I just finished. The insurance company cut a check out to the Insured for like $55,000.00 and now the Insured is giving me problem on releasing the check to me. I’ve told the property owner I am willing to settle total job for that amount and not charge him a deductible.

Fortunately my company’s name along with his name is on the check. (Too complicate matters the property which is a 100,000 Sq Ft building is in foreclosure!) Is there any law that says the owner has to release the check to me? Its not like he can do anything since both of our names are on it! Help!

Struggling In Orlando

Cut to the chase time, Struggling!   You need an attorney’s advice and you need one right away and especially with the foreclosure situation. While you are consulting with your lawyer on this situation also check on how you can change your procedures and legal paperwork to avoid the same problem in the future.

More and more of our SFS members are hitting problems where the home or building is “underwater” (forgive the pun!) as in the current appraised value is worth much less than the amount of the mortgage.  So in some cases the owner (or the mortgage company) lets the restorer do the emergency mitigation work, cashes the check and leaves the restoration company “high and dry”!

So in addition to tightening up your legal paperwork you should also search for “Early Warning Signs” that there may be an issue on any incoming loss.  If possible, you should run an Internet search of the address BEFORE starting emergency work and if there are some legal clouds take steps BEFORE you start work.

For example, it is entirely appropriate to take a page from a lawyer’s playbook and ask for a retainer up front and graduated payments (either from the property owner or the insurance company) as certain steps are completed in your work. Just explain that this is your company’s “standard operating procedure” and you’ll be amazed at how many will play ball.

After all, the property owner is standing in 3″ of water at the time!  You have them exactly where you want them since they are DESPERATE! The problems come AFTER you have done all the work and they have YOUR check.  That is where (as you are finding out) the problems start since they no longer are desperate and YOU will be the DESPERATE one!

I FINALLY learned that when I became the “knight in shining armor mounted on a white horse” too often I would get bucked off.  Or as my mother always used to say, “No good deed goes unpunished!”  So a major part of your success will be knowing when to walk away!

Let me know what happens.

Steve Toburen

NOTE: I am not a lawyer and none of my comments should be considered legal advise. 🙂

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