What is the difference between licensed/unlicensed contractor?

Question

I had a contractor do some work and we was not licsenced. Now I need to go to small claims court for crappy work. What are the rules that he must follow? I live in AZ. Please any info you have will help me. And I know the obvious (one doesn't have a license)

Answer 1

Contractors licenses are governed by State law, so it varies. In AZ, licenses are required, and complaints are handled by the AZ Registrar of Contractors. The way they see it, you are the victim of a crime.

You may be able to AUTOMATICALLY prevail in court - depending on what laws are on the books in AZ. In CA, for example, if a contractor is doing work for which a license is required, and he is unlicensed while performing any part of the work, he is not entitled to a DIME. The property owner wins. Period. (See the link below to a discussion of a case illustrating this point.) CA Business & Professions Code section 7031(b) also states: "... a person who utilizes the services of an unlicensed contractor may bring an action in any court of competent jurisdiction in this state to recover ALL COMPENSATION paid to the unlicensed contractor for performance of any act or contract" (emphasis added). See if you can find a similar law on AZ's books, and include that in your small claims paperwork and bring a copy of the law to show the judge when you are in court.

Answer 2

Unfortunately, you are finding out the hard way just what the difference is: you can sue a licensed contractor, you cannot sue an unlicensed contractor. State laws do vary, so check with your state contractor's board, or consumer board.

In most states there is a board that tests and sets standards for contractors. The person who wishes to become a contractor must work for a licensed contractor for a certain number of years, four in California, to prove they have learned the basis of their craft. The licensed contractor must fill out paperwork assuring the board the applicant has served the required time.
Next, the applicant must take a test to prove to the board they have the theoretical basis to become a contractor in their preferred area of expertise. If they pass the test, they must pay the state a fee each year to maintain their license. You may require a contractor show you his ID and his license.

That is the law of the situation. Unfortunately, there are many unscrupulous operators out there. They forge documentation to take the test, they lie to unsuspecting homeowners, they pay a friend with a contractor's license to fill out the paperwork stating they have served the time, when in fact, they have not. Even people who come by their licenses honestly can develop honesty problems because of some financial pressure in their lives, drugs, and alcohol. And, even when the people who have honestly earned their licenses, their skill levels are not all equal. Alas, I know of no licensing board which does a practical, or "hands-on" test of the applicant's skills.

In my personal experience, you need to call the local contractor's board for the skill you need, get a few names of licensed contractors from them, then do a lot of asking around. I have hired contractors whose work I have seen with my own eyes before I hired them, and gotten work that was not as good as that I had seen. I recently met someone who is an unlicensed contractor, legal in the state where I now reside, who is the best worker I have ever hired.

So ask around
Call the Better Business Bureau, or local boards that keep track of these statistics
Demand proof of ID and a contractors license, then double check with the board
Require photos of previous work
Ask if you can go to the site of previous work, some of their previous happy customers will let you see the work.
If you get good work, tell everyone you know so the person gets lots of work in your area

Answer 3

In the city/state of Huntsville, AL a licensed contractor must have a state business license and a city business license. In order to obtain the licenses you must show proof of liability insurance; in addition, when applying for the license, you will be interviewed by a city inspection dept. worker. The answers to the questions asked can be used as liable information towards you in a court of law. The questions range from what kind of work you will be doing, how long have you been in business, any pending claims against you, etc. etc. The point is most municipalities do their best to not just license anyone, but to actually require some merit and accountability of them. A licensed contractor will have a paper trail to their name and business, which can in turn be of benefit to someone like you in your "particular" situation. Be prepared to have to prove that he was the one doing the work, and also be prepared to be asked "Why did you hire an unlicensed worker?"

Answer 4

I would say it's the difference between satisfaction and a lawsuit.