Thinking About Firing Your Contractor? Read This First.
When a home construction project goes sideways, many homeowners’ first instinct is to fire the general contractor. But in California, that can be a costly mistake. Many construction contracts require that before an owner can terminate the contractor, the owner must first provide a written notice of default and a reasonable opportunity to cure the problem.
Failing to follow that procedure can turn the tables — instead of holding the contractor liable, the owner may be found to have wrongfully terminated the contract and breached it themselves
The Law: Strict Compliance Required
California courts strictly enforce contractual termination provisions. As the court explained in Clark v. Tide Water Associated Oil Co. (1950) 98 Cal.App.2d 488, failing to provide a written notice of default and an opportunity to cure is “fatal” to a claim for damages.
Similarly, Hansen v. Fresno Jersey Farm Dairy Co. (1934) 220 Cal. 402 held that when a contract requires written notice, an oral warning doesn’t count. The California Supreme Court in American-Hawaiian Engineering & Construction Co. v. Butler (1913) 165 Cal. 497 went further, holding that the notice must “fairly and fully advise the contractor of what the owner demands, and what the owner will do in the event of noncompliance.”
In short: if your contract says the contractor must get a written notice and time to fix the problem before being terminated, you must follow that procedure to the letter. Otherwise, the termination is ineffective, and you may lose your right to recover damages
Why the “Opportunity to Cure” Matters
California Civil Code §1511 provides that a party’s performance is excused if it is prevented by the act of the other party. That means if a homeowner fires a contractor without allowing them a chance to repair or complete the work, the contractor’s obligations are excused — and the homeowner can’t recover for alleged defects.
The purpose of this rule is practical: it prevents unnecessary litigation and gives contractors the chance to fix issues before the relationship is terminated. Courts view it as a matter of fairness and efficiency — both parties get the opportunity to make things right
Wrongful Termination = No Recovery
If an owner terminates a contractor without following the required notice and cure process, the owner’s claims for breach of contract and damages may fail entirely. Courts have consistently held that such terminations are “ineffectual and vain.”
In those situations, the owner not only risks losing their damage claims, but could also be liable for the contractor’s damages arising from the wrongful termination — including lost profits and unpaid balances
Practical Takeaway for Homeowners
Before you terminate your contractor:
Review your contract carefully. Look for any clause about “notice,” “default,” or “opportunity to cure.”
Put everything in writing. Oral complaints don’t count.
Give the contractor a fair chance to fix the problem. Courts require strict compliance with cure periods.
Consult an attorney before acting. A quick conversation with a construction lawyer can prevent expensive mistakes.
Terminating a contractor feels like taking control — but done the wrong way, it can cost you the right to recover anything at all.