RME/RMO, Adding Qualifiers & Transferring License Numbers

Becoming a Qualifier has certain ‘qualifications’ in whatever form is chosen. Understanding the differences between RME/RMO may take an expert and an example of what can go wrong. A licensed corporate construction company can be ‘removed’ to create a new firm, but they will discover some thing’s can’t be ‘transferred’…

Q: My Company’s Responsible Managing Employee (RME) has resigned and I have been asked to be the Responsible Managing Officer (RMO) for the corporation’s license. However, I have my own personal license that I need to keep active for small jobs that I do on the side.

I understand that I need to have at least 20% ownership in the company in order to keep both licenses active, which isn’t a problem.  My concern is that if something goes wrong on a job that my company contracts for and there is a complaint filed, is that going to affect my Sole Owner license?  And will I be held responsible for judgments/claims against the other license?

 

A:  While it depends on the circumstance, as the Responsible Managing Officer you do hold some liability for claims, judgments, and complaints against the license.  If the company license has an unsatisfied judgment that results in the suspension of the license while you are the RMO, it is likely that the CSLB will also suspend your Sole Owner license until the judgment has been satisfied.

 

In fact, to give you an example of a case where problems with a company license trickled down to an individual license, in a recent case the CEO of a corporation entered in to a contract with a homeowner, took a down payment, and then never did any of the work.  This of course resulted in the homeowner filing a complaint.  The RMO of the company claimed to know nothing about the project and further claimed that he wasn’t involved in the business operations.  The company was cited with several violations that resulted in the license being revoked. A separate order was signed which provided for the revocation to be stayed on the RMO’s individual license provided that he comply with all terms and conditions including a 2-year probation, $15,000 disciplinary bond, and restitution to be paid within 90 days in the amount of the down payment that the homeowner paid.

 

As always, we recommend that you contact a construction attorney to discuss the legal liabilities associated with acting as a Responsible Managing Officer.

 

Q:  We are going to close our current corporation down and start a new one.  Since the current corporation will no longer need the contractor’s license number, is it possible to transfer the number to the new corporation?

 

A: License numbers cannot be transferred from one corporation to another.  When a new entity is formed you are required to obtain a new contractors license number for that entity.

Q: We currently have a General “A” license and we have an employee with an inactive “B” license.  Can we add that employee as the “B” Qualifier on our license, or do we need to use the same Qualifier that currently holds the “A”?

 A:  You can add your employee as the “B” qualifier on your license and you are not required to use the same Qualifying individual who currently holds the “A” classification.  You can have a different Qualifier for each separate classification on your license.

 

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