Legal Question in Construction Law in California
Prime building contract
We signed a contract with a licensed general to build a new home. The contract stipulated the general could sub-contract out portions of the work to properly licensed and qaulified subcontractors. We found out that the general used/paid unlicensed and or invalid licensed subcontractors. Can we sue to get the money back which was paid to unlicensed subs?
Thank you
2 Answers from Attorneys
Re: Prime building contract
Here are my thoughts:
(1) You are not in "privity of contract" with the subs, so you can't sue them for breach of contract or to recover from them for illegally performing services for which a license is required. You could probably sue them for negligence or other similar torts, if grounds exist, e.g., they were not only unlicensed but also did something wrong and you or your property were damaged thereby.
(2) You can sue the prime contractor for breaching his contract with you, but you would have to allege and prove money damages resulting from his breach.
(3) Performing work for which a license is required, without having the right one, is a crime, so if you really wanted to take a swat at the illegal subs, you could complain to the Contractors State License Board, the police and the D.A. and try to stir up enforcement action.
(4) A civil suit of any kind will probably require proof of damages in order for you to recover more than a token amount.
(5) California's laws against unlicensed contracting are very tough, and there may be some provision of law that renders incorrect what I've said above, especially item #1; if so, I didn't find it in my usual references after a little research, but I'll look with interest to see what is said in further answers, if any.
Re: Prime building contract
No point doing that, but you better get proof they are paid and don't lien your property.