If a company hires a contractor to work on your home is the company/employer liable for faulty work?
Under the legal theory of respondeat superior, an employer may be held vicariously liable for the negligence of employees. Employers are generally only liable for acts of employees that fall within the scope of their job duties. However, there is case law which allows a victim to sue employers directly for their failure to monitor their employees, or failing to check them out before hiring them, or for failing to fire them after learning of their questionable conduct.
One of the most important considerations in determining whether someone is an independent contractor or employee is the degree of control exercised by the company over the work of the workers. An employer has the right to control an employee. It is important to determine whether the company had the right to direct and control the workers not only as to the results desired, but also as to the details, manner and means by which the results were accomplished. If the company had the right to supervise and control such details of the work peformed, and the manner and means by which the results were to be accomplished, an employer-employee relationship would be indicated. On the other hand, the absence of supervision and control by the company would support a finding that the workers were independent contractors and not employees. Whether or not such control was exercised is not the determining factor, it is the right to control which is key.
Another factor to be considered is the connection and regularity of business between the independent contractor and the hiring party. Important factors to be considered are separate advertising, procurement of licensing, maintenance of a place of business, and supplying of tools and equipment by the independent contractor. If the service rendered is to be completed by a certain time, as opposed to an indefinite time period, a finding of an independent contractor status is more likely.
An unjustifiable failure to perform all or some part of a contractual duty is a breach of contract. A legal action for breach of contract arises when at least one party's performance does not live up to the terms of the contract and causes the other party to suffer economic damage or other types of measurable injury. A lawsuit for breach of contract is a civil action and the remedies awarded are designed to place the injured party in the position they would be in if not for the breach. Remedies for contractual breaches are not designed to punish the breaching party. The five basic remedies for breach of contract include the following: money damages, restitution, rescission, reformation, and specific performance. A money damage award includes a sum of money that is given as compensation for financial losses caused by a breach of contract. Parties injured by a breach are entitled to the benefit of the bargain they entered, or the net gain that would have accrued but for the breach. The type of breach governs the extent of damages that may be recovered. Restitution is a remedy designed to restore the injured party to the position occupied prior to the formation of the contract. Parties seeking restitution may not request to be compensated for lost profits or other earnings caused by a breach. Instead, restitution aims at returning to the plaintiff any money or property given to the defendant under the contract. Out of pocket losses caused by the breach should be substantiated by copies of repair bills and other lossses and expenses caused by the breach.
Mold cases often present difficult issues of proof with regard to causation and damages, due to the lack of standards for mold. Water damage mitigation is something that must be dealt with quickly and effectively. Most home insurance policies not only cover the cost of water damage mitigation, but also require the policyholder to take the necessary steps to prevent secondary damages. If the insurer inspected the damage, they may not have taken proper measures to repair the damage. The EPA says, "Stop the water leak quickly and begin restoration during the first 24 hours. It is important to dry water damaged areas and items within 24-48 hours to prevent mold growth".