Business & LicensingQuestion 1377 of 1632

An unlicensed person performs work requiring a license and sues the customer for nonpayment. What is the result?

a.The court awards the contract price, less a statutory penalty
b.The contractor recovers its documented labor and material cost
c.The contractor recovers in quantum meruit, but no profit
d.The action is barred, whatever the merits of the claim

Explanation

B&P §7031(a) bars a person from bringing or maintaining any action for the collection of compensation for work requiring a license without alleging licensure at all times during performance, and it says so 'regardless of the merits of the cause of action'; §7031(b) goes further and lets the customer recover back what was already paid. (a), (b) and (c) are the equitable compromises the courts have refused — no discounted contract price, no cost recovery, no restitution in quantum meruit. The one narrow escape is the substantial-compliance showing under §7031(e).

Law Reference: B&P Code §7031(a) / §7031(e)

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Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)
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