A $22,500 Deposit Claim Grew Into Statutory Fee Exposure
A custom staircase contractor kept a $22,500 deposit and bet that litigation costs would consume a homeowner's recovery. Leave to add fee-shifting statutes was granted over opposition, and the matter settled out of court.
Fee exposure
added over opposition
- Resolved
- Public court
- Case
- Lin v. Serett Metal Works Corp.
- Court
- Supreme Court of the State of New York, New York County
- Judge
- Justice Gerald Lebovits
The situation
In Lin v. Serett Metal Works Corp., a homeowner brought a six-figure contract action against a custom staircase contractor that retained a $22,500 deposit, supplied inaccurate drawings, missed installation dates, and substantially delayed the renovation. The contractor strung the homeowner along and refused to settle for even half the deposit, exploiting the contract's lack of a fee-shifting provision and betting that litigation costs would consume the recovery.
The approach
After replacing prior counsel, overlooked home improvement and deposit-protection statutes were identified, and leave was sought to amend the complaint to add claims for deficient disclosures, failure to escrow advance payments, and diversion of funds under New York General Business Law §§ 771, 772 and 773, and New York Lien Law § 71-a.
The outcome
The contractor opposed the amendment as prejudicial because it increased exposure on what was otherwise a $22,500 claim. The court disagreed, crediting the argument that the deposit was only a fraction of a contract worth several times that amount, holding that increased exposure was not unfair prejudice where the new claims arose from the same underlying facts, and granting the amendment over opposition — expanding the contractor's potential liability and introducing statutory attorney's fee exposure. The parties ultimately resolved the matter out of court.
The full write-up
This page keeps the figures and the holding. The firm's own account of the matter, in full, is here:
Prior results do not guarantee a similar outcome. Each matter is different, and the results described here were achieved on the specific facts of those matters.