California law and court decisions have always protected the consumer from unlicensed contractors. An unlicensed contractor cannot recover money in any court if he is owed anything by a consumer, notwithstanding whether the consumer knew the person was unlicensed prior to contracting to do the work. Recently, I have seen a number of B licensed contractors advertising as specialty contractors which is a play on the public. Typically these B licensees advertise that they are roofers or re-modelers, but they make their money in supervising their subs who actually do the work. The result is that the consumer pays an extra 20 per cent for nothing but a supervisor.
The twist here is that many of these B contractors state that they have no employees on the website so they are exempt from worker's comp insurance, but when they get a job, they suddenly have a bunch of guys who work for them. So what does that mean?
If a contractor does not have worker's comp and has employees on the job that work at the contractor's direction, then the contractor's license is suspended as a matter or law, or in laymen's terms, immediately, with no hearing needed. This converts a licensed contractor into an unlicensed contractor, which means the consumer now owes him nothing and can sue the now unlicensed contractor for disgorgement, meaning all the money paid should be refunded to the consumer. Again, it does not matter whether the consumer knew the contractor was licensed or not. A case decided last year gave the consumer $55,000 against a landscaper who was unlicensed who had done the work. The landscaper was dumb enough to sue the consumer and it cost him $55k.
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The story here is to check with the Contractor's State License Board and confirm not only that they have a license, but that they have worker's comp, and what their specialty really is. A simple visit to the website will save you thousands of dollars and a few sleepless nights. It is also important to confirm that a licnsed contractor has liability insurance as well as being current with his bonding company.
