Another Trap For Home Improvement Contractors
In a case of first impression, a court in Suffolk County holds that a licensed home improvement contractor whose license expires in mid-project is not entitled to recover for services performed thereafter.
Most counties in New York State have licensing laws requiring that home improvement contractors possess a special license at the time of entering into a home improvement contract. Failure to obtain the license means that the contractor may not sue for the money it is owed—even where there is no dispute that the work was properly performed and the money would otherwise have been due.
Over the years, courts have addressed a variety of permutations surrounding this requirement. For example, it has been held that although an unlicensed contractor may not sue for amounts due, the homeowner is not entitled to get money back which it has already paid. Other courts have held that if you can’t sue for your money, you also can’t file a mechanic’s lien for it. And it matters not if you sue for breach of contract or under some other quasi-contractual theory.
But in a new issue which presented itself for the first time, a judge in Suffolk County held that if the home improvement license expires in mid-job, one can only sue for the money earned prior to its expiration (if it was not timely renewed). The court recognized that there was a certain amount of unfairness in requiring a contractor which was licensed when it entered into the contract to forgo its undisputed earnings. But it felt it had no choice but to rule as it did.
The effect of this holding was to find that a landscaping contractor (yes, landscapers are subject to the home improvement licenses in Suffolk County) was able to recover only the $3,557 it earned before its license expired, not the $14,660 it earned after it expired.
Sometimes a good diary is more important than a good lawn mower.
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