Frugal Homeowner Found Liable
It seems like a good idea: why not save money on renovations by hiring a competent worker instead of the extra expense of a state-licensed contractor? What could go wrong in a simple renovation?
A recent California Appellate decision should serve as a reminder that a property owner may be liable for negligence if someone is injured on a job because of an unlicensed contractor, even when the owner has no involvement in that contractor’s actions.
In Blackwell v. Vasilas, a property owner (Vasilas) hired an unlicensed contractor (Gomez) to provide stucco repairs,which required him to erect scaffolding. Vasilas then hired Blackwell to install rain gutters. When Blackwell climbed the stucco scaffolding to reach a section of the roof, it collapsed and he fell 10 feet, landing on a pile of bricks and injuring himself. Blackwell sued the homeowner Vasilas for negligence,not Gomez, the unlicensed stucco contractor.
At trial, homeowner Vasilas claimed that unlicensed stucco contractor Gomez was an independent contractor and therefore he had no obligations to rain gutter contractor Blackwell. The Appellate Court disagreed. It held that because stucco contractor Gomez was not a licensed contractor, he was an employee of the homeowner Vasilas, making Vasilas liable if Gomez was negligent.
California Labor Code Sec. 2750.5 provides that a worker performing a task which requires a state license is an employee of the hiring party unless that party can prove the worker is an independent contractor. Unlicensed stucco contractor Gomez apparently possessed many of the attributes associated with independent contractor status, such as skills required, control over how services are performed, and provision of tools and materials. Still, this was insufficient to satisfy the Labor Code requirement that “any person performing any function or activity for which a license is required pursuant to [the Contractors’ State License Law] shall hold a valid contractors’ license as a condition of having independent contractor status.” (Italics added.)
Consequently, Gomez was found to be an employee of homeowner Vasilas and as the employer, Vasilas potentially owed a duty of care to rain gutter contractor Blackwell under the tort theory of respondeat superior.
Bottom Line: Be wary of using unlicensed contractors to save money. And make sure your homeowners’ insurance provides adequate liability coverage.
This article was submitted courtesy of Steven Sorell, MBA, Attorney at Law, who integrates his business experience with business law and tax/financial expertise.