How Much Does it Cost to Sue a Contractor?

When you hire a contractor, you trust them to bring your vision to life—whether it’s a kitchen remodel, a new roof, or a basement renovation. But what happens if the work is left incomplete, poorly executed, or, in the worst case, the contractor vanishes? 

If you’re in this unfortunate situation, you’re likely wondering how much it costs to sue a contractor and whether legal action is the right path for you.

In this guide, we’ll explore the potential costs involved in suing a contractor. We also provide steps to help you prepare for court and offer cost-effective alternatives so you can resolve the issue without breaking the bank.

Costs Involved When Suing a Contractor

Before pursuing legal action when a contractor hasn’t finished their work, you should understand the expenses involved. These costs do vary quite a bit depending on the complexity of your case, the court you file in, and whether you hire an attorney.

Filing Fees

Filing fees are the initial costs you’ll encounter when bringing a case to court.

• Small Claims Court: Filing fees typically range from $20 to $100, depending on your state. Small claims court is often the best option for disputes under $10,000, offering a simpler and more affordable process.
• Civil Court: For claims exceeding small claims limits, you’ll need to file in civil court. Filing fees here can range from $100 to $500, depending on your state and the size of your claim.

Process Server Fees

After filing your lawsuit, you must formally notify the contractor by serving them with court papers.

Process server fees generally range from $20 to $100. If multiple attempts to serve the contractor are needed, the cost may increase.

Attorney Fees

Most small claims courts don’t allow you to have an attorney. However, if you do need to escalate to civil court, hiring an attorney is highly advised.

Hourly rates for attorneys range between $150 and $500, depending on their experience and location. Some attorneys work on contingency, meaning they only get paid if you win your case. In this scenario, they typically take a percentage (usually 25%-40%) of the awarded amount.

Additional Costs

Other potential expenses may include:

• Expert Witness Fees: If you need a professional to testify about subpar workmanship, expect to pay several hundred dollars or more.
• Document Preparation: Costs for copying and organizing contracts, photos, or emails to present as evidence.
• Transportation Costs: Travel expenses for court appearances or meetings with your attorney.

Tips to Minimize Costs

Legal action can become expensive very quickly. Thankfully, we have some tips to reduce your costs. 

Try Small Claims Court

Small claims court is ideal for smaller disputes. Depending on your state, the claim must be under $5k to $25k.

Small claims court eliminates the need for attorneys and simplifies the legal process, saving you significant time and money.

Gather Evidence Yourself

Collect all the required documentation yourself. This includes:

• Contract
• Payment receipts
• Photos of work
• All written communications (including emails and text messages)

By gathering this information yourself, it can reduce how much legal preparation you’ll have to pay someone else to do.

Send a Demand Letter

Before filing a lawsuit, consider sending a demand letter to the contractor. This formal letter outlines your grievances and requests a resolution.

You may find that this is enough to have the contractor work with you to resolve the dispute without any further work on your part.

Alternatives to Suing a Contractor

Litigation isn’t the only path to resolving contractor disputes. Here are some cost-effective alternatives to consider.

1. Mediation

In mediation, a neutral third party helps you and the contractor reach a mutually agreeable solution. This process is less formal than court and usually costs less.

Cost: $100 to $300 per session (or free if offered by your state licensing board).

2. Arbitration

Arbitration is more formal than mediation would be. However, it’s much faster and cheaper than going to court. An arbitrator is there to hear both sides and make a binding decision. Some contracts include an arbitration clause requiring this step before litigation.

Cost: Typically $1,000 to $3,000.

3. Filing a Complaint with the State Licensing Board

If your contractor is licensed, your state licensing board may offer free or low-cost arbitration or mediation services. They can also penalize contractors who violate licensing laws.

Cost: Free! Most states do not charge to file a complaint.

4. Selling Your Home to a Cash Buyer

If your contractor dispute involves significant property damage or unfinished work, selling your home As-Is to a cash buyer could be a smart move. Companies like House Buyers of America purchase homes in any condition. This way, you avoid costly repairs or legal action.

Cost: Free! In fact, by selling to a cash buyer, you’ll end up making money instead of spending it.

FAQ: How Much Does it Cost to Sue a Contractor?

Can I Recover Legal Costs if I Win the Case?

In some cases, the court may order the contractor to reimburse you for legal fees if you win. However, this depends on state laws and the specifics of your case. Be sure to ask your attorney or check local laws for details.

What if I Can’t Afford to Sue?

If legal action is too costly, consider mediation, filing a complaint with your state licensing board, or selling your property As-Is to a cash buyer.

How Long Do I Have to Sue a Contractor?

The timeframe depends on your state’s statute of limitations, which typically ranges from 2 to 6 years. Check your state laws to confirm the exact deadline for your claim.

What Happens if I Win but the Contractor Doesn’t Pay?

If the contractor refuses to pay after you win, you may need to enforce the judgment. Options include garnishing their wages, placing a lien on their assets, or pursuing other legal remedies, depending on your state’s rules.

Is It Worth Suing a Contractor?

Suing is worth considering if the damages are significant and alternatives like mediation have failed. However, weigh the potential costs against the recovery amount to decide if litigation is the best path forward.