Legal Question in Construction Law in California

Re: Validity of receipts presented by contractor

Unlicensed contractors generally cannot sue to enforce their contracts or to recover the fair value of services rendered. Therefore, payment or non-payment of these bills may boil down to a matter of conscience. I would suggest you examine the bills carefully and pay those that seem valid.

The law also denies rights to a material supplier who was aware that he was selling to an unlicensed contractor for work requiring a license. However, to the extent the materials suppliers did not know what was going on (which would be pretty usual in these days), they could potentially file liens or lawsuits if unpaid. I think your risk is pretty low, but worth taking into consideration.

Whether items like nails and screws should be 'part of the contract' or are subject to reimbursement as a separate expense cannot be concluded without referring to the contract language itself.

Another aspect is that an unlicensed contractor might be treated as your employee for certain legal purposes, e.g on-the-job injuries.

All things considered, I think you should negotiate a fair settlement price, sign mutual releases, and preserve the friendship.

Re: Validity of receipts presented by contractor

The legal issue here is that the contractor is unlicensed. It is close to impossible for an unlicensed contractor to legally force you to pay for any services he provided, although you may have to pay for materials if the supplier properly liened your property.

A new statute that came out this past year even goes so far as to say that under the proper circumstances you can recover anything you have already paid to an unlicensed contractor.

Beyond the legalities, however, how will this play out socially? Do you live next door to this guy? Does his children play soccer with your children? Although he doesn't appear to have any legal bargaining strength, there might be some social pressure that you may want to consider. If he is unlicensed, though, you probably don't have to pay him anything.

I suppose it's possible that a court could consider him an employee of yours (which creates a whole different range of considerations) but, in my experience, it's rare for a court to consider someone doing contractor type duties an employee.