How do I find out if a general contractor has disputes with past clients?

Begin with the seller. Ask for a written list of current and recent disputes: unpaid invoices, deficiency claims, warranty complaints, liens and any legal notices. Ask how each was handled. Also request the correspondence with the clients involved. A seller who answers openly and in detail usually has less to hide, and one who is vague is telling you where to dig.

Then check the answer independently. Your lawyer can search for lawsuits and liens against the company. Look at online reviews, but remember that happy clients seldom write. Ask for references from recent projects and call a few. Speak with architects, suppliers and subtrades if the seller allows it, since they know who pays and who argues. An industry association may also help you find out how members handle complaints.

Finally, look at the finances for signs. Large unpaid holdbacks, repeated warranty costs, rising legal fees or a long list of overdue receivables can all point to friction with clients. Find out what remains unresolved at the time of sale, and ask your lawyer how those matters should be handled in the purchase agreement, so they do not land on you.

Key takeaways

• Ask for a written list of disputes, then verify it independently.
• Have your lawyer search for claims and liens against the company.
• Call recent clients, suppliers and subtrades, not only the references offered.
• Look for friction in the financials, such as holdbacks and legal fees.