The state Office of Consumer Affairs and Business Regulation [OCABR] disciplined embattled Mutual Builders Inc. principal Jay Pelletz on May 6 with a six-month suspension of his contracting license and a $4,250 fine. The penalties followed a complaint hearing on April 4, involving Jeanty Pierre Paul of Dudley and his attempt to recoup nearly $80,000 he paid for work that was never finished.
As Worcester Sun has previously reported, Pelletz has been repeatedly accused of missing appointments, not addressing repairs, and taking deposits from customers and never starting work.
Pierre Paul alleged Pelletz committed three violations of Massachusetts General Law 142A, which regulates home improvement contractors, including abandoning the project; making a misrepresentation to procure a contract with Pierre Paul; and failing to comply with a state order.
While the hearing officer, Jennifer Maldonado-Ong, found Pelletz in violation of only one of those allegations, abandoning and failing to complete the project, three other violations were cited.
The hearing found the agreement between Pierre Paul and Pelletz, who served as contractor, lender and mortgage broker, was “superfluous” and “improper.” That type of transaction is prohibited by state law.
That Pelletz demanded full payment for construction of the home before all work was completed was another violation, as was the insufficient contract used in the transaction, which was missing standard addendums such as payment schedule and a cancellation rights notice.
Additionally, the contract was missing a statement directly above the signature line warning the homebuyer not to sign the contract if any of the above were missing.
Attempts to reach Pelletz, including twice by phone late last week, have been unsuccessful since November.
Pierre Paul said work is left unfinished in the basement, where he says a new 80-gallon water heater should be installed. A two-car garage and rear deck have yet to be built, and a driveway and sidewalks remain incomplete.
“The water heater he put it in isn’t large enough for this house. The house plan says he was supposed to put in an 80-gallon water heater. He put in a 50-gallon,” Pierre Paul said.
In the end Pierre Paul paid Pelletz $77,500 and an additional $6,000 for lawyer’s fees since last year. Pierre Paul said he was considering a civil suit. The Sun was unable to confirm.
Pierre Paul said he can’t afford to hire another contractor to finish the work until he’s reimbursed by Pelletz. “I don’t want that guy to come to my house. He’s a liar and a thief. He’s never going to pay me back my money,” Pierre Paul said.
Pelletz is now on the hook to the state, as well. The regulatory office fined him $1,000 for failure to complete Pierre Paul’s home; issued a $1,500 fine for serving as both lender and mortgage broker in a residential contracting transaction; $1,500 for demanding final payment before the project was completed; and $250 for the incomplete contract, according to the state order.
Pelletz was required to immediately surrender his home improvement contractor Certificate of Registration (#175330), which will be suspended until Nov. 6. The registration expires May 8, 2017.
He has until tomorrow, June 6, to pay his fines and request an appeal.
Christopher Goetcheus, spokesman for the state consumer-business office, said June 2 that Pelletz had not paid his administrative penalties, nor had he appealed the decision. He had not made contact at all, Goetcheus said.
“After that 30-day window, if we haven’t received the administrative penalty, we issue a notice for registration revocation hearing. Meanwhile, his registration remains suspended,” Goetcheus said. “Generally, we look at the facts and circumstances of each case and if [Pelletz] pays the penalty, there will be consideration for renewal [of registration].”
Pierre Paul’s complaint is the only one filed with the Office of Consumer Affairs and Business Regulation against Jay Pelletz and Mutual Builders Inc.
“Jay Pelletz violated many of the Massachusetts laws,” Pierre Paul said in an interview with the Sun on June 2. “He should be charged criminally.”
Since the Sun began covering the numerous allegations against Pelletz in November, the Mutual Builders office has been put up for sale, the website has been taken down, the main office telephone number has been disconnected, and the Better Business Bureau has dropped the company’s rating from an “A+” to an “F” and issued a consumer warning against Mutual Builders.
In 2016, there have been three complaints issued against Mutual Builders to the Better Business Bureau.
Additionally, Jay’s father and founder of Mutual Builders, Mel Pelletz, who says he retired from Mutual Builders five years ago, has attempted to publicly distance himself from the business.
In 2013, Mutual Builders was contracted to reconstruct Pierre Paul’s home in Dudley for $256,000.
A 2012 fire irreparably damaged the multi-unit, owner-occupied home at 3 Cross St. owned by Pierre Paul.
Pierre Paul paid another contractor $7,500 for a new foundation before striking an agreement with Pelletz and making a $58,500 deposit.
Construction of the new home began in March 2014 before halting in June 2014 due to monetary issues with Pierre Paul’s insurance company.
According to the state findings, the insurance company ceased payments to Pierre Paul because the fire-loss claim expired having passed the agreed-upon six-month completion.
The insurance company had paid $178,000 by then.
Pierre Paul agreed to a mortgage from Pelletz held by Mutual Builders for $77,500 – the difference of the fire loss claim — with a promissory note for Pierre Paul to begin making payments on August 29, 2014, and the now incomplete home served as secured repayment of the note.
According to the state consumer-business office, after receiving the mortgage, Pelletz and Mutual Builders resumed some work, but communication between he and Pierre Paul became “sporadic.”
Pierre Paul did not pay the mortgaged amount by August 29, and in December 2014, Pelletz demanded payment of the loan. In late February 2015, Pelletz gave Pierre Paul until July 31, 2015 to pay back the loan and any accumulated legal fees or Mutual Builders would foreclose on the mortgage.
On May 28, 2015, Mutual Builders filed a complaint to allow it to foreclose on the property.
That same month Pierre Paul attempted to obtain a loan to pay off the mortgage and fees owed to Pelletz — a total of $83,625.00. He secured the loan from Quicken Loans on Aug. 14 and moved in about that time.
The mortgage was paid in full to Mutual Builders, and according to the OCABR, the funds were “applied to bills and other operating expenses.”
However, with the mortgage paid off, Pelletz never returned to complete the construction of Pierre Paul’s home — triggering Pierre Paul to submit a complaint with the Better Business Bureau in September 2015.
Communication, Pierre Paul said, between he and Pelletz began quickly deteriorating — culminating in a confrontation between the two at Mutual Builders’ 660 Park Ave. office in October resulting in Worcester Police being called to “diffuse the situation, according to the state findings.
Pierre Paul sent a demand letter under Mass. General Law Chapter 93A — the Consumer Protection Act — to Pelletz in November seeking a refund of $167,000.
Pelletz failed to respond with an offered settlement to Pierre Paul’s demand letter within the 30-day response time, resulting in Pierre Paul taking legal action with the state Attorney General’s Office and OCABR.
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