My Contractor Overbilled Me or Charged for Work That Was Never Done

Types of Contractor Billing Problems

• Billing for work not performed: Charging for labor hours, materials, or tasks that did not happen. This may constitute fraud or theft.
• Material substitution: Charging for specified higher-grade materials while using cheaper substitutes.
• Unauthorized work: Performing work beyond the contract scope without written authorization, then demanding payment. California BPC §7159 requires written authorization for additional work.
• Inflated hours: Billing for more labor hours than actually worked on time-and-materials contracts.

Your First Step — Audit the Billing

Request an itemized breakdown of every charge. Compare it line by line against your contract, change orders, and your own records. Photograph the completed project to compare against the billing. For large discrepancies, an independent quantity survey by a licensed contractor can document the difference between what was billed and what was actually provided.

Withholding Disputed Amounts

California law generally allows withholding amounts genuinely in dispute — but not amounts owed for undisputed completed work. This is a nuanced area where legal advice is important. Withholding more than you are entitled to can give the contractor grounds to file a mechanic’s lien against you.

Pursuing Recovery of Overpayments

If you have already paid fraudulently billed amounts, pursue recovery through a demand letter, CSLB complaint, and civil lawsuit. If the overbilling was intentional, you may be entitled to punitive damages beyond your actual losses.