Contractor - and current state-senate candidate - who walked away from home project after clients paid him for most of the work deserves all the punishment he got, court rules

The Massachusetts Appeals Court today upheld the license suspension and fine a state board levied against a Peabody contractor who deposited money meant for an attic refurbishing project into his separate house-flipping business, stopped paying contractors, abandoned the job, filed for bankruptcy and then sued the couple after they blocked pending credit-card payments to him.

The state Office of Consumer Affairs and Business Regulation had levied a $4,400 fine against Damian Anketell and suspended his contracting license for ten months, concluding he had "materially misrepresented" himself to the Newburyport couple by using their payments to prop up his separate business rather than paying subcontractors on their job and had illegally "abandoned" the project, leaving them with what a separate federal Bankruptcy Court ruling concluded was "an exposed roof and no heating on the second floor." In that case, a judge ruled Anketell's debts to the couple were "nondischargeable" in his bankruptcy case and dismissed his suit against the homeowners.

Anketell, the Republican candidate for the 2nd Essex state-senate seat, appealed, arguing he didn't need to explain the details of his company finances to the couple and that he didn't abandon the project - they did, by halting payments to him - and that, in any case, state law requires proof he intended to abandon the project, and there was none.

Yeah, no, the appeals court ruled:

Anketell mismanaged funds paid by the homeowners so that he did not have enough money to finish the project, failed to pay subcontractors, and then stopped work. He argues that the homeowners' unwillingness to pay him more money and give him more time is what ended the project. But Anketell's inability to complete the project under the terms of the contract amounted to abandonment. It should go without saying that homeowners do not have to throw good money after bad, or show forbearance to a contractor who cannot meet the terms of his agreement. Proof of Anketell's intent to abandon the project was not required.

In its summary of the case, the court recounted a meeting between the couple, Anketell and a subontractor who had stopped working on the $111,293 project because Anketell wasn't paying him:

On April 3, 2015, at the request of a subcontractor, the homeowners met with the subcontractor and Anketell. The subcontractor told the homeowners that he and the other subcontractors were not being paid and that much of the money that the homeowners had paid toward the contract had been diverted to Anketell personally. That subcontractor had reviewed Ground Up's bank statements and learned that the homeowners' payments had been depleted from the account by cash withdrawals and checks payable to "cash" or to Anketell personally, with no explanation from Anketell where the funds had gone. Although Anketell promised the homeowners that he would be able to recapitalize and complete the project in a short amount of time, they had lost faith in him.

The court also summarized the state regulatory hearing:

In April 2018, after resolution of the bankruptcy matter, the OCABR held an administrative hearing at which Anketell and the homeowners testified and exhibits including Ground Up's financial records were admitted in evidence. The hearing officer issued a written decision concluding that because the contract clearly set forth a payment schedule with installments due at certain stages of the project, Anketell's failure to tell the homeowners that he would deposit their payments to his businesses' general fund was a material misrepresentation. The hearing officer further concluded that Anketell had abandoned the project without justification. Crediting the testimony of the homeowners and discrediting portions of Anketell's testimony, the hearing officer found that Anketell's financial issues were caused by his own mismanagement of Ground Up's funds, including his use of those funds for [the house flipping company]'s projects. From evidence that included Anketell's testimony, the hearing officer found that before construction began, Anketell spent over $50,000 of the homeowners' funds, including by diverting money to [that company].