RECOVERING PAYMENTS TO UNLICENSED CONTRACTORS
Prior to this year, the law in California provided that unlicensed contractors could not maintain a lawsuit in any court for unpaid fees. Contractors had to allege and prove they were licensed at all times during the time that they performed their work.
However, many unlicensed contractors survived by being paid in advance. Once the work was done and paid for, consumers had little recourse unless they could prove actual damage as a result of the work done by the licensed contractor.
Business & Professions Code § 7031 was amended effective January 1, 2002 to crack down on the unlicenced contractor problem. Now anyone who utilizes the services of an unlicensed contractor may bring an action to recover all compensation paid for performance of any act or contract. It is not clear that the work in question had to have been performed after January 1, 2002. If the work was pursuant to a written contract, it appears that suit can be brought against any unlicensed contractor for work done during four years prior to filing the suit.
