Contracts & ExecutionQuestion 851 of 1605
A properly licensed contractor completes a commercial tenant improvement and is not paid. The contractor's ability to sue for the unpaid balance is generally supported because:
a.The contractor was duly licensed at all times during performance, satisfying a key prerequisite to recovering compensation
b.Licensing is irrelevant to lawsuits
c.The Statute of Frauds guarantees payment
d.Only unlicensed contractors may sue
Explanation
California requires a contractor to have been duly licensed at all times during the performance of the work in order to bring an action to recover compensation. Being properly licensed throughout the job satisfies this critical prerequisite and preserves the contractor's right to sue for the unpaid balance. Licensing is highly relevant, not irrelevant; unlicensed contractors are barred, not favored; and the Statute of Frauds concerns required writings, not a guarantee of payment.
Law Reference: Business & Professions Code §7031Practice all 1605 questions free — no signup required.
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Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)