Source: https://marinbar.org/news/article/?type=news&id=403
Timestamp: 2019-04-19 03:21:36+00:00

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By David F. Feingold, Esq.
Regardless of your practice area, many of your clients are homeowners. Most also have hired or will hire a contractor to work on their home. They might have the foresight to educate themselves about the legal issues involved when embarking on a home improvement project. They may even ask you to look at the contract.
For any project involving large dollar amounts or potentially dangerous work, the proposal or draft agreement should be reviewed by counsel. That page of small print on the back of the proposal for services typically includes a number of booby traps, such as hold harmless and indemnity clauses heavily favoring the contractor, limitations of liability, and other exculpatory language. The standard form AIA contracts also should be reviewed and modified as necessary to protect your client. But I digress—the purpose of this article is not to analyze all of the issues raised in a construction contract. The purpose is to acquaint you, the general practitioner, with the “top ten” laws and regulations I think you should know about when dealing with home improvement contractors.
1. License Required: Any contractor who does home improvement work must be licensed by the Contractor’s State License Board (“CSLB”). (Bus. & Prof. Code § 7159, subd. (b).) (There is an exception for what is considered “minor work,” which is work that does not involve more than $500 in labor and materials.) “Home improvement work” is defined broadly and basically includes “the repairing, remodeling, altering, converting, or modernizing of, or adding to, residential property.” (Bus. & Prof. Code § 7151.) Almost everything, from landscaping to windows to HVAC systems to carpeting, falls under the “home improvement” definition.
9. No License – No Hope: An unlicensed contractor cannot sue to recover money for work requiring a license. (Bus. & Prof. Code § 7031, subd. (a).) An unlicensed contractor may also be required to disgorge any money he or she received from the owner. Let me repeat that: An unlicensed contractor can be sued and required to give back all the money he or she has been paid. (Bus. & Prof. Code § 7031, subd. (b).) The license requirement is strictly construed and can have draconian results, as illustrated in Great West Contractors, Inc. v. WSS Construction, Inc. (2008) 162 Cal. App. 4th 581. In Great West, the subcontractor that signed the contract was a recently formed corporation. The subcontractor’s president, as an individual, held a valid contractor’s license at all times. However, the corporate entity was not licensed at the time it submitted its bid and performed some preliminary tasks but it did obtain its corporate contractor’s license shortly thereafter. Because the corporate entity was not licensed prior to beginning performance, it could not recover compensation because it was not licensed at all times. As if not being able to sue and being required to disgorge funds received was not enough pain, an unlicensed contractor causing injury or damage may be liable for three times the amount of damages (to a maximum of $10,000), plus costs and attorneys’ fees. (Code Civ. Proc. § 1029.8.) You can—and always should—check the status of a contractor’s license by contacting the Contractors State License Board. The easiest way is on the web.
10. Prove the License: If you represent a contractor in a suit, you must prove license status by producing a verified certificate of licensure from the Contractors' State License Board showing that the contractor held all necessary licenses during performance of the work. (Bus. & Prof. Code § 7031, subd. (d).) If you are representing an owner or other contracting party, have your motion for non-suit ready when the contractor misses this crucial step.
David F. Feingold, Esq., is a partner with the San Rafael law firm of Ragghianti Freitas LLP. His practice is focused on representing community associations, homeowners, and contractors in real estate and construction matters.

References: § 7159
 § 7151
 § 7031
 § 7031
 v. 
 § 1029
 § 7031