My Sunday column used the experience of a Plymouth man who successfully sued his former contractor to explain how winning a judgment in conciliation court isn’t the same as collecting your debt. The comments on the story offer some advice from those who have experienced this little-noticed arena of the Minnesota court system.

After reading my column, Donald H. Walser, an attorney with Kraft Walser Hettig Honsey Kleiman in Hutchinson, Minn., alerted me to the Contractor Recovery Fund, a pot of state money that comes from fees paid by licensed contractors. Here’s how the state Department of Labor and Industry describes its purpose:

The purpose of the Fund is to compensate certain owners or lessees of residential property (located in Minnesota) who have lost money due to a licensed residential
contractor’s fraudulent, deceptive, or dishonest practices, conversion of funds, or failure of performance that arose directly out of a transaction that occurred when the residential
contractor was licensed and performing any of the special skills enumerated under Minn. Stat. § 326B.802, subdivision 15 (2008).

Homeowners or renters can recover up to $75,000 ($50,000 if the loss happened before Dec. 1, 2007) if they can prove their case to the state. A prerequisite is getting a judgment in court against the contractor. The judgment has to be against the “licensed entity,” something that the Plymouth homeowner I wrote about, Leo Melamud, discovered to his frustration, because the contractor he sued is apparently licensed under the name of his business. Now Melamud is attempting to get that name added to his judgment.

The fund isn’t available to those who hire non-licensed contractors. So property owners face an added risk using a non-licensed contractor. Detailed instructions on filing a claim for the Contractor Recovery Fund are available here.

The contractor, Robert Loeffler of Midwest Creative Interiors, has more troubles than just Melamud’s judgment. In April, the state revoked Midwest Creative Interiors’ license, assessed a $2,500 fine and ruled that Loeffler cannot work as a residential building contractor.

This entry was posted on Tuesday, June 16th, 2009 at 11:51 am and is filed under Home improvement, How to blow the whistle. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.