In the wake of Hurricanes Irma and Maria, residents of the U.S. Virgin Islands are doing what they can to band together and rebuild. The recovery of such staggering natural disasters is never easy—neither logistically nor legally.
Both property owners and the contractors they hire must carefully protect their legal rights and ensure they avoid potentially damaging relationships. Disaster recoveries are desperate times, and unless both property owners and contractors are careful, they could find that others take advantage of their kindness and vulnerability.
Below are some legal tips for contractors and property owners alike during the hurricane recovery efforts.
Advice for contractors, subcontractors and suppliers
The people who are actually performing the recovery work need to ensure they are protected. Much of this assurance needs to take place before a disaster actually occurs. All contractors, subcontractors and suppliers should know what the lien rights are in the territory if they want to ensure they can secure payment for their work.
Matters can get difficult when out-of-territory contractors come in to provide their services. A contractor from Florida, for example, might have different rules in its home state than one based in the U.S. Virgin Islands.
In addition, when dealing with recovery work, contractors and suppliers are likely to be receiving at least some, if not all, of their payment from insurance providers. Delays in insurance checks can cause some major financial problems for contractors. All parties to an agreement should understand that it might become necessary for the contractor to preserve and secure its right to payment.
Tips for property owners
After major storms, disaster zones tend to be flooded by contractors and suppliers looking for work. In many cases, this is extremely beneficial for both parties, as contractors get the work and the people who need it have resources readily available. However, the downside is that there are potentially fraudulent parties looking to take advantage of desperate people. There have been plenty of instances in recent disaster recovery situations, such as after Hurricane Sandy, in which contractors abused homeowners and either took money for work not completed or engaged in poor workmanship.
It’s important to stay in constant communication with contractors you hire at any time—and especially in disaster scenarios. You should, for example, have contractors list every party working on the project, a description of each party’s duties on the job site and any other information that will help you ensure responsibility on the part of the contractor.
Homeowners should also add conditional lien waivers to their payments. In doing so, a property owner asks the main contractor and any subs and suppliers to waive the right to file a lien.
To learn more about how to legally protect yourself as a contractor or property owner when it comes to disaster recovery efforts, speak with an experienced U.S. Virgin Islands business and contracts attorney.
Tom Bolt is Managing Attorney of BoltNagi, a widely respected and well-established business and corporate law firm serving individuals and organizations throughout the U.S. Virgin Islands.