Western Electrical Contractors Association, Inc.

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Renewal of Your Contractor's License and the Effect of a Late Renewal

Thursday, November 21, 2019

Content courtesy of: Abdulaziz, Grossbart & Rudman

By: Kenneth S. Grossbart of Abdulaziz, Grossbart & Rudman

In past articles, we have addressed the issue of licensing and the effect on your ability to collect your money if for any reason you are deemed to be unlicensed. Not only will the unlicensed nature of your business affect your ability to collect monies but will also put you in the precarious position of having to return all monies that you have collected on the job. 
The harshness of Business and Professions Code Section 7031 which states in part that if you perform work that requires a license, you must be "duly licensed at ALL times." This means that if you have a gap in your license status at any time during the course of a construction project, you could be considered not to be "duly licensed" at ALL times. Be assured that if you are involved in a lawsuit, your opposition will check your license status and if a determination is made that you have a gap in your license, the issue of licensure will be raised and you will have to defend yourself and prove that you have been licensed at all times or satisfied the substantial compliance requirements of Business and Professions Code Section 7031. 
This brings us to the renewal of your contractors' license. As all contractors know, your contractors' license must be renewed on a regular basis. The Contractors' State License Board ("CSLB") sends out the renewal notice. The number one requirement for you as the contractor is to make sure that the CSLB has your correct address. If you have moved or changed address, you MUST notify the CSLB of your new address. The CSLB sends the renewal notice to the address they have on file and if you do not get the notice then you are not going to know that your license needs to be renewed and, ultimately, you could be operating with an expired license. Once your license is expired, you will then have a gap in your license history. Even if the license renewal is sent to you, often times you are so busy that you put it aside or delegate someone else to renew the license. Oftentimes, because of the press of business and the forgetfulness of people, your license is not renewed on time. In that scenario, you will have a gap in your license history. It could be days or even weeks before you recognize the fact that you forgot to renew your license.

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