Opinion ID: 1207008
Heading Depth: 3
Heading Rank: 3

Heading: Did Gross Substantially Comply with Registration Requirements?

Text: Gross maintains that he substantially complied with the registration requirements of AS 08.18; hence his suit should not be barred. He argues that because he had a valid bond and insurance as required under the statute, he satisfied the essential elements of the statute. We do not believe that Gross has sufficiently complied with the statute for us to utilize the equitable doctrine of substantial compliance. Registration as a construction contractor under AS 08.18 requires: a registration fee, [6] a surety bond, [7] and public liability and property damage insurance. [8] Registration must be renewed annually. [9] In addition, no person registered under one name may act in the capacity of a contractor under any other name unless that name also is registered. [10] Registration was intended by the legislature to ensure competence and financial responsibility in those who undertake work as contractors. Sumner Development Corp. v. Shivers, 517 P.2d 757, 763 (Alaska 1974); see also Industrial Power, 623 P.2d at 303 (Rabinowitz, C.J., concurring in part, dissenting in part). When the contract was formed on February 6, 1981, Gross was not registered with the State of Alaska as a general contractor. [11] In fact, he had not been registered since March 1978, although he submitted an application in May 1981 which he subsequently withdrew. Gross was insured and had a $5,000 surety bond in the name of Creative Builders. The statutory bar precluding legal actions by contractors unless the contractor is registered at the time of contract formation may be avoided by the contractor's substantial compliance with the registration requirements. Jones v. Short, 696 P.2d 665, 668 (Alaska 1985) (the contractor, in renewing his registration, had filed all necessary documents with his insurance carrier who then failed to promptly process the application for renewal). Substantial compliance involves conduct which falls short of strict compliance with statutory registration requirements, but which affords the public the same protection that strict compliance would offer. Alaska Protection Services v. Frontier Colorcable, 680 P.2d 1119, 1122 (Alaska 1984). A contractor who has not registered at all, not filed the required surety bond, nor obtained insurance has not substantially complied with the registration requirements of AS 08.18.151. State ex rel Smith v. Tyonek Timber, 680 P.2d 1148, 1155 (Alaska 1984). The burden of compliance is solely the responsibility of the unlicensed contractor. Id. A contractor who is registered, bonded, and insured, but who contracts under an unregistered name, has substantially complied with AS 08.18.051 since he has sufficiently `afforded the other party the effective protection of the statute.' Frontier Colorcable, 680 P.2d at 1122 (quoting Latipac, Inc. v. Superior Court, 64 Cal.2d 278, 49 Cal. Rptr. 676, 411 P.2d 564, 566 (1966)). Gross has not substantially complied with the construction contractor's registration requirements because Gross' failure to register at all prevented the public from ascertaining his status. In fact, state records available to the public [12] at the time of the contract's formation would have shown that Gross had not been registered since 1978, and that Creative Builders was involuntarily dissolved in September 1980. Gross' registration did not lapse for a short period, due to an insurance broker's negligence as in Jones. On the contrary, Gross has not been registered since 1978. Two months before signing the contract, Gross filed and then withdrew his application for registration. Consequently, he was well aware of his non-registered status at the time of contract formation. Moreover, Gross was not registered with the State under another trade name, as in Frontier Colorcable.