Keeping up with the notification and paperwork required for most all contractors can be time consuming. However, failing to stay up to date with State government agencies on simple things like a change of address, a shuffle of corporate officers or an unexpected turn of events can be costly. As I have been asked our first question more than once, let me give new ‘life’ to a previous answer…
Q.: Our Responsible Managing Officer (RMO) recently died without notice. Since our contractor’s license must be renewed at the end of this month, what do you suggest we do to replace him ASAP?
A.: When a RMO leaves a contractor’s license for any reason, the company has 90 days to replace them or the license will be suspended. In your case, the former company president died 83 days ago. Since it is unlikely a replacement can be accomplished in the next week, I would advise requesting a 90-day extension. This must be done in writing and should be delivered to the CSLB within the initial 90-day “grace” period. A copy of the death certificate should accompany your request. I would also suggest filing the contractor’s license renewal prior to the expiration date along with the appropriate license application to qualify a new RMO.
While we often don’t want to consider the consequences of death, in our lives or business, the changes prompted by someone’s passing need to be part of our planning. In business, the ‘life’ of the company could also be at stake without realistic planning for this contingency. I am often contacted about a ‘backup’ license that may be in order for some reading this column.
Q: I just discovered the prime is not actually licensed, as I was ready to sign a sub contract. What now?
A: Despite the fact the company has an individual with a contractor’s license, they are still operating illegally because the corporation – with whom you would be signing the contract – does not have a valid license number. As a licensed subcontractor you could be fined or issued a citation for knowingly contracting with an unlicensed entity. B&P Code 7118 addresses the issue of Contracting with an unlicensed company: “Entering into a contract with a contractor while such contractor is not licensed constitutes a cause for disciplinary action”.
Q. The CSLB has twice rejected our Application To Report Current Officers. We are simply trying to notify them that we have a new President. What now?
A. In reviewing your Application, I noticed that you listed yourself as Vice President. Yet, you’re listed on the CSLB record as a Responsible Managing EMPLOYEE (RME). Board rules do not allow you to be OFFICER and RME. You must file an Application to Replace the Qualifying individual. In other words, you would need to replace yourself!