Mechanic’s Lien Rules, General Builder’s & Swimming Pools and Handyman Limits

Handymen need to remember the scope and limits of their work or they might find themselves ‘a dollar’ over the line and on the wrong side of the law.  Licensed contractors also face significant penalties when projects go astray, including revocation of their license number. Wrapping it up we help settle a ‘buddy’ bet that offers an important reminder about knowledge and power…

 

 

Q:  I am a licensed contractor and I regularly read your Q&A’s.  I came across one recently regarding Handymen performing work under $500.  I have never understood this rule completely.  Is that per job, per customer or what are the criteria?

 

A:  A handyman is permitted to perform work that is under $500 per job and, important to remember, that includes labor and materials.

 

Q:  You helped me obtain my license recently and I am getting ready to make new contracts but I’m getting confused when looking at the CSLB’s website regarding the Mechanics Lien law. Am I supposed to put the notice on the contract itself?

 

A:  It’s nice to hear from you again.  A Mechanics Lien Warning is required to be part of a Home Improvement Contract or New Residential Contract.  This applies to every contract or changes in a contract and it can be incorporated within the contract or as an attachment.  The specific wording for the notice that is required is outlined in B&P Code section 7164. Or, if it remains unclear call my office for more help.

 

Q:  I recently had my license revoked because of a judgment and I’ve been getting conflicting information regarding the repercussions of having a revoked license. Does this mean that I will never be able to get a contractor’s license again in the future?

 

A:  Not necessarily.  It really depends on the specifics of your situation.  Many times if you can prove that the judgment that resulted in the license revocation has been satisfied then you can in fact obtain a contractor license again in the future.  When you apply the CSLB will review your situation and make a case-by-case determination.

 

Q: I’m hoping that you can settle a disagreement with a buddy who is also a licensed contractor. Can a “B” General Building contractor perform part of the work necessary for pool construction?  It is my understanding that a “B” contractor can do anything as long as two unrelated trades are involved on the same project.  Is that a good bet?

 

A: No, that is not correct; a General Building contractor cannot do “anything” as long as two unrelated trades are involved. There are many trades that are not covered within the General Building classification.  In fact, pool construction is one of them!  Even though the project involves two unrelated trades, the appropriate classification would be the “C-53” Swimming Pool license.

According to the State’s definition of the “B” classification, “a General Building contractor is a contractor whose principal contracting business is in connection with any structure built, being built, or to be built, for the support, shelter, and enclosure of persons, animals, chattels, or movable property of any kind, requiring in its construction the use of at least two unrelated building trades or crafts, or to do or superintend the whole or any part thereof.” Sorry, but you lose that bet!

This is also a great example what we think we know versus the actual law, and why Capitol Services is here to provide expert assistance in getting it right. Don’t depend on rumor.  Got a question? We’ve got answers and share the knowledge here so we might all learn from the problems others encounter.

 

Handyman Rules, Generals, Subs & Materials Payments

A ‘general’ question starts out this Q&A, and for anyone who employs subcontractors a valuable lesson comes with the answer. We discover a ‘major’ glitch in the ambitions of another contractor and a handyman with a ‘minor’ problem…

Q:  I am a General Contractor and the supplier on one of my jobs from last summer recently contacted me regarding payment.  I paid retention to my sub, but it turns out he did not pay his material supplier, and at this point has no ability to do so.  The supplier claims that they filed a preliminary notice, so my question is, as the GC am I responsible to pay the 2nd tier sub’s supplier?

A:  I reached out to a former CSLB employee, Michael Brown, who now serves as a contractor licensing expert witness for attorneys.  He stated that as a General Contractor, you are not responsible for payments to anyone with whom you don’t have a direct contract.  The license law does not provide for discipline in such cases, but a sub like the one described can certainly mess up a project.  One solution would be for the General to require joint checks and/or lien releases from the sub and the sub’s material suppliers in order to avoid this type of problem.

Q:  My question is about getting a General Building license.   I’ve been working for a few years with a contractor doing a little bit of everything (mainly plumbing, painting, drywall, finish carpentry).  I have also done some handyman work on the side such as fencing, and plumbing repair   Do you think I’ll be able get my license with this background?

A:  Thank you for your email.  In order to qualify for a General Building (“B”) contractor’s license you must be able to show 4 or more years full time experience within the past ten years.  The CSLB will require that someone verify your background in two or more unrelated trades — plus rough framing. The Board will look for work in what they consider the “major” building trades (plumbing, concrete, electrical, roofing and HVAC).  Unless you have this work background – especially framing – it is unlikely the Board will accept your application for a “B” license.

If you would like to discuss any aspect of this licensing, please contact us and we’ll be happy to discuss your entire situation.

Q:  I have been doing ‘minor’ repair work for the last several years, but I don’t have a contractor’s license. I would like to know what services a Handyman cannot perform or advertise for.  I plan to get my license once I have the four years of experience under my belt, but until then I want to make sure that I’m not doing anything incorrectly.

A:  There are no specific trades/services that I am aware of that a Handyman cannot perform and advertise for, as long as the total cost of the project does not go over $500, including materials and labor.  Also, when advertising, individuals who are unlicensed are required to indicate in their ad that they do not have a State Contractor’s license.

Feel free to call us when you ready to obtain your license or if you have any additional questions. We can help navigate the route to a successful conclusion in obtaining a license in California, Nevada or Arizona.

B&P 7031, LLC’s, Bonds, License Suspension & Expired Licenses

Despite the obvious ‘suspense’ we step up to provide a ‘remedy’ for a contractor worried about ‘hiccups’ in applying for the LLC license. Just in time, we remind all our readers why it is critically important to keep the CSLB up to date on your business address. Failing to do so carries a potentially high price …

 

Q:  We are in the process of obtaining a new license for an LLC.  We have already applied and we anticipate that the license will be issued within a month or so (fingers crossed!).  The bonds on our existing corporate license are due to expire this week.  Since we don’t plan on using the corporate license anymore we are considering letting the bonds expire rather than paying to renew them, which will result in the license getting suspended.  Is having a “suspended” license going to prevent us from obtaining the pending LLC license?  Before we do this I just want to make sure that there are absolutely no hiccups with the pending application!

 

A:  While there are certain instances where having a suspended license could cause some problems when applying for a new license, a suspension due to lack of a bond should not cause any hiccups when obtaining the new LLC license.  As another option you could just cancel the license, which would eliminate the need for a bond and also prevent you from having a “suspended” status on record.

Q:  I have a question about late license renewals.   My license expired last year because we moved and the renewal was never received or forwarded by the post office.  By the time I realized what had happened, and drove to Sacramento to get this handled, my license had been expired for nearly three months.  Everything is fine now, but I’m worried this might cause problems in the future.  Is there anything I can do to get this expiration erased from my record (like what you can do with a speeding ticket)?

A:  Unfortunately, I am not aware of anything you can do to have this expiration removed from your licensing records.  There is no online “traffic school” that magically erases this type of problem.

When you finally renewed your license at the front counter, the form they handed you should have stated: “Delinquent Renewal, Read Section 7141.5 of the Contractors License Law regarding retroactive renewals”.  That would have been the time to make such a request; however, since the reason for the late renewal application was due to contractor error and not a “Board error”, it is highly doubtful they would have granted your appeal.

It is incumbent upon the contractor to notify the Board in writing within 90 days of moving. As you learned, unless the CSLB has a contractor’s address of record, it is very unlikely you’ll receive these important mailings (the Post Office generally will not forward documents from the CSLB).

I hate to be the bearer of more bad news, but your problems may not be over. Business and Professions Code Section 7141 states, in part: “Renewal (of a license) under this section shall be effective on the date an acceptable renewal application is filed with the board. The licensee shall be considered unlicensed and there will be a break in the licensing time between the expiration date and the date the renewal becomes effective.”  In other words, during this “nearly three months,” your license was expired you may be subject to the provisions of B&P Code 7031.  Among other things, this means if you were to get into a legal dispute with a homeowner or another contractor down the road, for work performed during this “unlicensed” time period, you likely will not be able recover any compensation you’re owed.

RME, General & “C-10”, Worker’s Comp Exemption & New 2013 Rules for “C-20 & “C-21” Contractors

Like the chefs at your favorite diner we are cooking up a few ‘short’ orders while providing contractors with a steady diet of ‘Q and A’ at the Capitol Connection. We finish this feast as the CSLB is ‘turning up the heat’ to serve new rules for contractors in disposing of mercury in California…

Q:  I came across your website and I’m really hoping you can answer a question for me.  One of our employees has two Sole Owner licenses: a “C-10” (Electrical) as well as a “B” General Contractor’s License.  We would like him to become the Responsible Managing Employee (RME) for our company and qualify a “C-10” license.  Does he have to deactivate both of his licenses or just the Electrical license?

 

A:  Thank you for contacting us.  Except in very rare circumstances, an RME can only be on one license at a time, therefore he will be required to deactivate both of his Sole Owner licenses in order to become the RME on the company’s license.

Q:  As the qualifying individual for my current company, if I change jobs does my status and test results for the license move with me to the new company?

A:  Yes, once you leave the company you have up to five years to obtain a license or add yourself to another company license without needing to re-take the exams.

Q:  I currently have Worker’s Compensation Insurance through State Fund.  The renewal for the policy is $940.00.  We do not anticipate working in CA in the near future.  Would you recommend changing the license to exempt from Worker’s Comp, or changing the status of the license to inactive?  If we were to inactivate the license, how difficult would it be to reinstate?

 

A:  If you don’t currently have employees and you don’t anticipate any work in the near future then either option would work.  If you decide to inactivate the license, you are not required to keep the bond and Worker’s Comp on file with the CSLB, however you would need to make sure that those items are current in order to reactivate the license in the future.  Additionally, you would need to pay the reactivation fee in order to reinstate the license when you are ready to begin work in CA again.

New Rules for “C-20” (HVAC) and “C-21” (Building Moving/Demolition) Contractors!

Beginning July 1, 2013, a new rule took effect in California for both HVAC and Building Mover/Demolition contractors who dispose of out-of-service thermostats containing mercury.  The new regulation requires the contractor to put his/her license number on the thermostat container, or provide the license number at the collection location accepting the device.  This regulation requires that collection sites provide the number of mercury thermostats received and the contractor license numbers to manufacturers, who in turn submit an annual report to the California Department of Toxic Substances Control.  This new regulation will help aid in the effort to safely recycle old thermostats.

Contractors can find the nearest collection site by going to http://www.thermostat-recycle.org/search.php and filling in a ZIP code or call our office for additional questions.