Can I take my builder to court as a sole trader? He didn't disclose his limited status

bravo88

Hi all, 

First time posting on here, I need some advice from someone with legal knowledge who can help me decide what's best to do.. 

In short, I employed a builder to build an extension on my house 7 months ago. He did most of the work and then building control came round in the new year and said some things need changing. Builder is reading the messages but ignoring me. I believe these are things he needs to rectify and we have a signed contract in place that says he will complete the work. 

I have tried with 3 letters to mediate the issue: 

1) Asked for him to come and put things right

2) Requested a refund of the amount for other trades to fix the issues (thousands of pounds which I simply cannot afford) 

3) Letter before legal action, asking for a refund again

I can see he’s accepted and signed for all three letters so I am now looking at making a claim for money.

The problem is that this whole time I have been working with him I was under the false pretence he was a sole trader. It's only digging around on Companies House that I found he is limited but hasn't filed his accounts in over a year. The also has another brand new limited new company and two dissolved private ones. He doesn’t have 'limited' on his website, email signatures, document letterheads or signage, and he also gave me his name and personal address to add to the contract I drafted which outlined the deliverables. 

So, I need to know if it’s best to try and take legal action against:

1) Him as a sole trader. I drew up a contract which he signed, used his name and provided his home address. No mention anywhere of him being a limited company

2) The limited company. As mentioned, he had not disclosed the fact he is a limited company (which is a trading standards matter apparently?). If I’d have known this I wouldn’t have used him as there’s very little that can be done when claiming from a ltd company - I know as frustratingly I have already had this happen to me in the past with a carpet fitter. 

In short, do you think there are grounds to take legal action against him as a sole trader? I hope so, or that there is a loophole with the fact he didn’t not disclose his limited status.

TIA to anyone who can shed some light on this. 

DullGreyGuy

You take legal action against a legal entity be that a natural person or a legal person, in the headline you dont specify in what capacity the entity was operating. 

The contract document, having not seen it, may suggest that they entered into it personally rather than signing as the director on behalf of a company but would really have to see how the document introduces the entities at the start.  The other thing to look at is any documentation they provided you, like a quote, to see if it stipulates the contracting entity; any stationary should identify the entity beyond the branding at the top of the page. 

Assuming nothing mentions the Ltd then you contracted with him personally and therefore he personally would be liable for the works even if he chose to subcontract it to his company to manage. As such you would sue him personally... doesn't matter if he is acting as a sole trader or as a middleman on behalf of a company.

bravo88

DullGreyGuy said:

You take legal action against a legal entity be that a natural person or a legal person, in the headline you dont specify in what capacity the entity was operating. 

The contract document, having not seen it, may suggest that they entered into it personally rather than signing as the director on behalf of a company but would really have to see how the document introduces the entities at the start.  The other thing to look at is any documentation they provided you, like a quote, to see if it stipulates the contracting entity; any stationary should identify the entity beyond the branding at the top of the page. 

Assuming nothing mentions the Ltd then you contracted with him personally and therefore he personally would be liable for the works even if he chose to subcontract it to his company to manage. As such you would sue him personally... doesn't matter if he is acting as a sole trader or as a middleman on behalf of a company.

Thanks you for this, very helpful. 

I drew up the contract off my own back just to try and protect myself given past experiences, and I did this assuming he was a sole trader. The contract lists his name, the name of his company as I knew it (turns out that is actually one of the liquidated companies, his website and branding is out of date & he's still trading under that name), I asked for his address to add and he gave his personal one. None of the companies I have found - active or dissolved - use his personal address as correspondence. 

There is absolutely no evidence of him being limited anywhere at all. 

Obviously just reluctant to spend the money on small courts for it to turn out I need to go after the company instead, when I had no idea he was ltd  

DullGreyGuy

bravo88 said:
The contract lists his name, the name of his company as I knew it

See here you have shot yourself in the foot... you have know acknowledged there is a company involved which is why its important to see how its actually stated in the document 


Company - a separate legal entity; a legal person
Sole Trader - a natural person acting in the capacity of a business
Business - the trade of an entity be that a natural person or legal person
Trading Name/Style - a name other than that of the legal entity that they operate under for their business


Small claims court is intended to be simple but it's important not to be lax with language and many involved in cases use language that causes them to lose the case. 

tacpot12

Do you have home insurance? If so, do you have legal expenses cover? if you do, you can ask this question of the Legal Helpline that your insurer provides. They might even sue the builder for you.   

Hoenir

bravo88 said:

 The contract lists his name, the name of his company as I knew it (turns out that is actually one of the liquidated companies, his website and branding is out of date & he's still trading under that name), I asked for his address to add and he gave his personal one. None of the companies I have found - active or dissolved - use his personal address as correspondence. 

You've probably been dealing with someone who has always been at least one step ahead of you. 

ThumbRemote

Who, and how, did you pay?

If you paid a business bank account then you're dealing with a company. 
If you paid him personally then you can argue you employed him as a sole trader. 

DullGreyGuy

ThumbRemote said:

Who, and how, did you pay?

If you paid a business bank account then you're dealing with a company. 
If you paid him personally then you can argue you employed him as a sole trader. 

Payment doesn't prove anything, a builder for a small job asked us pay the full amount to his building merchant account, didnt mean B&Q (can't remember which one it actually was) became liable for the quality of his brickwork on our garden wall. 

bravo88

ThumbRemote said:

Who, and how, did you pay?

If you paid a business bank account then you're dealing with a company. 
If you paid him personally then you can argue you employed him as a sole trader. 

I believe a sole trader can open a business bank account though, especially if the lions share of their income comes from that

bravo88

tacpot12 said:

Do you have home insurance? If so, do you have legal expenses cover? if you do, you can ask this question of the Legal Helpline that your insurer provides. They might even sue the builder for you.   

I do but sadly legal isn't covered 

bravo88

DullGreyGuy said:

bravo88 said:
The contract lists his name, the name of his company as I knew it

See here you have shot yourself in the foot... you have know acknowledged there is a company involved which is why its important to see how its actually stated in the document 


Company - a separate legal entity; a legal person
Sole Trader - a natural person acting in the capacity of a business
Business - the trade of an entity be that a natural person or legal person
Trading Name/Style - a name other than that of the legal entity that they operate under for their business


Small claims court is intended to be simple but it's important not to be lax with language and many involved in cases use language that causes them to lose the case. 

Right. Would this be correct re. sole trader?

This contract is between ‘the client’ (my name, my address) and ‘the contractor’ (his name, his business name, his personal address).