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SUBCONTRACTOR TO UNLICENSED GENERAL CONTRACTOR NOT PERMITTED TO MAKE CLAIM DIRECTLY AGAINST HOMEOWNER

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  • Posted on: Oct 14 2022

By Jonathan H. Freiberger

Municipalities generally require home improvement contractors to be licensed to perform work.  “Where a home improvement contractor is not properly licensed in the municipality where the work is performed at the time the work is performed, the contractor forfeits the right to recover for the work performed, both under the contract and on a quantum meruit basis.”  Brightside Home Improvements, Inc. v. Northeast Home Improvement Services, 208 A.D.3d 446, 449 (2nd Dep’t 2022) (numerous citations omitted); see also, Forman Construction, Inc. v. P.D.F. Construction, 175 A.D.3d 1491, 1492 (2nd Dep’t 2019).  Similarly, a “home improvement contractor who fails to possess and plead possession of a valid license as required by relevant laws may not commence an action to foreclose a mechanic’s lien.”  J.D. Nicotra v. Manger, 64 A.D.3d 547, 547-48 (2nd Dep’t 2009) (numerous citations omitted).

Consistent with these principals, a home improvement contractor is required to plead its licensure in an action against a consumer.  Thus, CPLR 3015(e) provides:

License to do business. Where the plaintiff’s cause of action against a consumer arises from the plaintiff’s conduct of a business which is required by state or local law to be licensed by the department of consumer affairs of the city of New York, the Suffolk county department of consumer affairs, the county of Rockland, the county of Putnam, the county of Westchester, or the Nassau county department of consumer affairs, the complaint shall allege, as part of the cause of action, that plaintiff was duly licensed at the time of services rendered and shall contain the name and number, if any, of such license and the governmental agency which issued such license. The failure of the plaintiff to comply with this subdivision will permit the defendant to move for dismissal pursuant to paragraph seven of subdivision (a) of rule thirty-two hundred eleven of this chapter.

It has been noted that “the legislative intent to protect residential homeowners places the burden unequivocally on the contractor to ensure that the license requirements are strictly complied with.”  Michael D. Canuso Const., Inc. v. Rogers, 267 A.D.2d 218, 219 (2nd Dep’t 1999) (citations omitted).

An interesting case addressing these issues is Cunningham v. Nolte, 188 A.D.3d 806 (2nd Dep’t 2020).  The parties in Cunningham were cohabitating and involved in an intimate relationship with one another for two years.  During their period of cohabitation, plaintiff performed extensive home improvement contracting work on the defendant’s residence in Rockland County … in reliance on the defendant’s promise that he would be reimbursed for the work following the impending sale of the residence.”  Cunningham, 188 A.D.3d at 807.  Plaintiff was not paid and, accordingly, sought to foreclose a mechanic’s lien he had filed against the residence, to recover damages for breach of contract, to recover in quantum meruit, and to impose a constructive trust over the residence.”  Id.  Supreme court denied defendant’s motion to dismiss “the causes of action to foreclose a mechanic’s lien, to recover damages for breach of contract, and to recover in quantum meruit.”  Id.  The Appellate Division modified and, in so doing, rejected plaintiff’s “contention that the licensing requirement of CPLR 3015(e) did not apply herein.”  Id. at 808.  The Court found that plaintiff engaged in home improvement contracting work without a Rockland County home improvement license.  Nor did the complaint allege that plaintiff possessed the required license.  Therefore, the Court held, “the causes of action to foreclose a mechanic’s lien, to recover damages for breach of contract, and to recover in quantum meruit should have been dismissed pursuant to CPLR 3211 (a) (7).”  Id.  The Court did find that the complaint adequately stated a cause of action for a constructive trust over the residence and, therefore, defendant’s motion as to that claim was properly denied by supreme court.

These issues are relevant to the October 11, 2022, decision of the Appellate Division, First Department, in Alpine Custom Floors, Inc. v. Yurcisin.  The defendants in Alpine were homeowners that entered into a home improvement contract with nonparty general contractor to perform restorative work to their property.  General contractor, in turn, subcontracted with plaintiff to perform a portion of the restorative work.  The general contractor was unlicensed but the plaintiff, subcontractor, was licensed.  

Plaintiff, commenced action claiming that “it performed work at defendants’ home and that, although the general contractor was unlicensed, it should be able to recover from defendants for the value of the services it rendered because it is licensed and because it performed some services for the homeowners at their request.”  The First Department unanimously affirmed supreme court’s grant of summary judgment in favor of the homeowners and, in so doing, noted that the evidence demonstrated “prima facie that the general contractor was unlicensed and that they did not contract directly with plaintiff for any of the work performed or agree to undertake any obligations to plaintiff.” In addition, Plaintiff failed to submit any contrary evidence.


Jonathan H. Freiberger is a partner and co-founder of Freiberger Haber LLP.

This article is for informational purposes and is not intended to be and should not be taken as legal advice.

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