Report Title:

Unlicensed Contractors

 

Description:

Requires unlicensed contractors (when found) from keeping moneys paid to them and require reimbursement of these moneys in a civil action to recover for work done. Failure to obtain a license is deemed unfair or deceptive practice if unlicensed contractor is found to violate chapter on restraint of trade.

 

THE SENATE

S.B. NO.

263

TWENTY-FIRST LEGISLATURE, 2001

 

STATE OF HAWAII

 


 

A BILL FOR AN ACT

 

relating to unlicensed contractors.

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

SECTION 1. The prevalence of unlicensed contractors in this State is a public safety hazard. Licensure assures the public that the contractor so licensed has passed a written competency test, has the specified experience, has a history of honesty and fair dealing, has valid workers’ compensation coverage for the contractor’s employees, has personal injury and property damage insurance and participates in the contractors recovery fund. These provisions protect the integrity of the profession and provide assurances to the public that their homes and businesses will be built safely and competently. Unlicensed contractors often bilk the public by promising more than they can perform competently, then failing to complete the job or doing so inadequately, and often times abscond with the money without even starting the job. The purposes of this Act are to:

(1) Clarify the intent of chapter 444, Hawaii Revised Statutes, is to prohibit unlicensed contractors from keeping any money paid to them and require the reimbursement of moneys paid to them because to allow unlicensed contractors to retain moneys without being licensed would defeat the licensing requirements of chapter 444, Hawaii Revised Statutes, and result in unfair competition to licensed contractors; and

(2) Clarify the intent of chapter 444, Hawaii Revised Statutes, is to hold unlicensed contracting an unfair or deceptive practice under chapter 480, Hawaii Revised Statutes, and to put unlicensed contractors on equal footing with licensed contractors who can be found to violate chapter 480 if provisions of chapter 444 are violated.

SECTION 2. Section 444-22, Hawaii Revised Statutes, is amended to read as follows:

"§444-22 Civil action. The failure of any person to comply with any provision of this chapter shall prevent such person from recovering for work done, or materials or supplies furnished, or both on a contract or on the basis of the reasonable value thereof, in a civil action, if such person failed to obtain a license under this chapter prior to contracting for such work. An unlicensed contractor shall reimburse or return any money or other consideration received pursuant to the contracting arrangement to the person who made the payment of money or provided the consideration. Failure to obtain a license under this chapter prior to entering into a contracting arrangement shall be deemed an unfair or deceptive practice and shall be subject to chapter 480, as well as this chapter."

SECTION 3. New statutory material is underscored.

SECTION 4. This Act shall take effect upon its approval.

INTRODUCED BY:

_____________________________