The Hazards of Contracting Without a License in Virginia
0August 18, 2022 by Tom Roberts, Esq.
Contracting without a license is illegal!
EXPOSES YOU TO 12 MONTHS IN JAIL AND $2500 + $500/DAY FINE!
Contracting for, or bidding upon the construction, removal, repair or improvements to or upon real property owned, controlled or leased by another person without a license or certificate, or without the proper class of license as defined in § 54.1-1100 for the value of work to be performed
What is a contractor?
“Contractor” means any person, that for a fixed price, commission, fee, or percentage undertakes to bid upon, or accepts, or offers to accept, orders or contracts for performing, managing, or superintending in whole or in part, the construction, removal, repair or improvement of any building or structure permanently annexed to real property owned, controlled, or leased by him or another person or any other improvements to such real property. For purposes of this chapter, “improvement” shall include (i) remediation, cleanup, or containment of premises to remove contaminants or (ii) site work necessary to make certain real property usable for human occupancy according to the guidelines established pursuant to § 32.1-11.7.
Risk You Will Not Get Paid For Your Work!
Your Contract May Not Be Enforceable!
The law states:
A construction contract entered into by a person undertaking work without a valid Virginia contractor’s license shall not be enforceable by the unlicensed contractor undertaking the work unless the unlicensed contractor (i) gives substantial performance within the terms of the contract in good faith and (ii) did not have actual knowledge that a license or certificate was required by this chapter to perform the work for which he seeks to recover payment.
Failure to renew a license or certificate issued in accordance with this chapter shall create a rebuttable presumption of actual knowledge of such licensing or certification requirements.
"Into the Weeds"
See Bacigalupo v. Fleming, 199 Va. 827, 832, 102 S.E.2d 321, 324 (1958)(interpreting prior law).
The legislative history and the case law together evidence an intention to strike a balance: to penalize those whose violations of the statutory scheme are knowing, but to excuse those who perform in good faith and whose violations are inadvertent
J. W. Woolard Mech. & Plumbing, Inc. v. Jones Dev. Corp., 235 Va. 333, 339, 367 S.E.2d 501, 505 (1988)
See Tuggle Masonry, Inc. v. Dailey, 80 Va. Cir. 219, 220-221 (No savings provision for obtaining license after contracting) Daniel Jones Remodeling, L.L.C v. Johnny Cheng-The Chiu, Et Al. CL-2007-14511 (Fairfax County Cir. 2008)(Big troubles for exceeding $ limits for contract class)
Only Exception: If Both of These Apply:
- substantial performance in good faith; and
- did not have actual knowledge that a licensed was required
Risk of Attorney's Fees in Litigation - under the Virginia Consumer Protection Act!
Contracting without a license in a consumer transaction is a violation of § 59.1-200 of the Virginia Consumer Protection Act § 59.1-196 et seq. Under that Act, you may be subject to attorneys’ fees! § 59.1-206
GET YOUR CONTRACTORS LICENSE!
Class A – single contract or project is $120,000 + (12 month $750,000+).
Class B – single contract is $10,000+ but less than $120,000 (12 month $150,000+ but less than $750,000)
Class C – single contract is less than $10,000 (12 month less than $150,000)
Virginia License Lookup - Is the contractor licensed?
Nothing herein is intended to be legal advice to you! You alone are responsible. The law firm always recommends that you seek the advice of counsel. Sometimes it is well worth it to pay for a 1 hour paid consult with an attorney. Nothing herein creates an attorney client relationship. As with all of this website – it is intended for Virginia and nothing in this website evidences any intention to purposely avail the law firm of the benefits and protections of other jurisdictions.
Category Contract Law, General | Tags: #unlicensed contractor, construction attorneys, construction litigation, dispute with contractor, performance bond litigation, unlicensed contractor, virginia construction litigation, virginia contractor
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