Construction Work 101 - Licensed vs. Unlicensed

In California, contractors (and subcontractors) must be licensed by the Contractor's State Licensing Board (CSLB) if they wish to provide any construction work for the general public where such work is for $500 or more. (Bus & Prof Code Section 7031, et seq).  How does the State punish those who violate the rule (and get caught)? By forcing them to pay back any money received for the unlicensed work.  In fact, even if the work was perfect, the hirer can file a lawsuit for Violation of B&P Section 7031, and under the statutes that follow, will be entitled to, at a minimum, all money paid to the unlicensed contractor.  It doesn't even matter if the hirer knew that the contractor was not licensed - makes no difference.

Similarly, insurance companies may have the right to expressly deny coverage of any claim against its insured where it discovers that the insured was not properly licensed.  That can pose a major problem if the work performed ends up being shoddy, defective, or otherwise causes damage to the hirer's property.

How do you know whether a contractor is licensed? The first thing to do is ask for the contractor's license.  Then, you can confirm whether the license is active, suspended, or non-existent by reviewing the CSLB website - www.cslb.ca.gov.  A second way to determine whether a contractor is licensed is through their advertising material provided to you - letterhead, bid sheet, business card - these items are required by law to have the contractor's license on them in plain view.  Thus, if you hire a plumber and his truck does not have a license number on it, chances are, he may not be licensed to perform the work.

The clear rationale for requiring contractors to be licensed is that you expect a higher degree of care to be used by a licensed contractor than by an unlicensed contractor.  Similar to your physician, who is licensed by the state in which he practices medicine, or your attorney, or your accountant, or your real estate agent.

Consumer Beware!  In Part II, I'll look at The Amount To Be Charged.

Have A Great Day!