Legal Question in Credit and Debt Law in California

Hello,

I live in San Jose, California, Santa Clara county. I have a question. Can an unlicensed contractor put a lien on my house?

I found someone on Craigslist to replace our fallen fence last week Sunday. I got an estimate of $2500 on a simple general receipt with very basic mention of work that would be done. No mention of material that would be used. Nothing printed on other side and no other info. beside that. The person claimed himself to be a licensed contractor. He put a license no. on the receipt. He called that a contract. When I check the status of the license now, I find that license expired in 2012. I paid him 20% i.e. $500 in advance.

The contractor was supposed to start work on the next day, i.e. Monday. Because of the rain, we mutually decided to start work the next day i.e. Tuesday. He didn�t show up for work. He mentioned that he had given time off to his workers and his wife was in hospital. We had a detailed talk over the phone and he assured that he would start work the next day i.e. on Wednesday. He didn�t show up on Wednesday either. All phone calls and texts went unanswered.

I hired someone else to replace the fence. The fence got replaced by Thursday, and paid for that in full.

Now, the 1st contractor texted me on Friday evening that he couldn�t show up because of some emergency, had to leave country, he was mad that I broke the signed contract, didn�t allow him to perform the work, he wouldn�t return $500 that had been given to him and would take me to small claims court for remaining : 2500-500=$2000 and would put a lien on our house.

So, my question is that whatever he plans to do, is it legal? Can he put lien on our house just like that? What are our options? I was thinking of filing claim for $500 against him in small claims court but want to understand the process and seek advice whether this would be the right thing to do or could do something else?

Will appreciate any help, advice in this regard.

Thanks.


Asked on 2/26/17, 4:51 pm

1 Answer from Attorneys

Anyone can get a mechanic's lien form, fill it out, and go down to the county recorder's office and record it. For an unlicensed contractor to do that, however, would be highly illegal. Furthermore, he would not be able to enforce the lien in small claims court for two reasons. First, small claims does not have jurisdiction to enforce mechanics liens. Second, by law an unlicensed contractor cannot successfully sue to collect payment under any cause of action, whether contract, lien, or even fraud. An unlicensed contractors' suit must be dismissed upon a proper motion by the owner. So although he could make trouble, by filing a lien and filing a lawsuit of some kind, in the end he will lose.

Turning to the question of your $500, first off even if he was licensed, it is a violation of the Contractors License Law for a contractor to take more than 10% or $1,000 before starting work. Second, just as an unlicensed contractor cannot sue to collect, they also are not allowed to defend against a suit by the owner for their money back. Even if the contractor has done a huge project, perfectly, if they are not licensed the owner can sue to get back every penny paid. So you certainly are entitled to the unearned $500 back.

Bottom line: he doesn't have a legal leg to stand on, if he records a lien he will be adding to his problems because then you could sue him for slander of title, and he absolutely owes you your $500 back. If he won't give it to you, I would contact the Contractor's State License Board and file an unlicensed contractor complaint, and file a small claims action against him for your $500 back. If he records a lien, you will probably have to hire a lawyer to get it removed, but you can then sue him for the attorneys fees and slander of title.

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Answered on 2/26/17, 11:41 pm


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