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We’ve already covered the number one reason contractors get sued. Now, let’s talk about how to stay in the clear when it comes to your contractor’s license.

Ever wonder what will happen if by mistake your office person forgets to renew your contractor’s license during an active project?


Under California law you would NOT be able to sue to get payment for your work done on that project.  Even worse, the owner could sue to get back all of the amounts paid on the project from you.

This was an absolute rule until recently when the new law went into effect.  California Business and Professions Code §7031 now allows a court to determine if “a contractor has substantially complied with license requirements if specified conditions are met,” such as when the contractor did not know or should not reasonably have known that he or she was not licensed at the time.

California Law has some new changes in store for your contractor's license.

This is good to know but you cannot count on it. You would still have to show that you acted promptly and with good faith to try to reinstate his or her license upon finding out that the license was not valid.


Given all of this you should NEVER let your contractor’s license expire or become invalid.  Send out a memo to the person in charge in your company about your contractor’s license. Make sure more than one way of calendaring your expiration date is implemented.  Better safe than sorry.

If your company gets involved any issues with the company license or the individual license of the RME, give us a call.  We at Ghassemian Law Group consistently help contractors with their licensing issues.  Help is a quick phone call away!


This article is informational only and meant to provide guidance. It is not meant to be legal advice and it does not create an attorney-client relationship. For what to do in your specific situation, please consult with a qualified Construction Law attorney.


Ghassemian Law provided thoroughly constructed and effective legal strategies for successful outcomes in the complex world of construction law for our small company. Core competence, due diligence, and a commitment to client needs are strengths that inspire confidence and keep producing results when it counts most.

Peter Greenberger

Pacwest Construction and Development Inc

Mahyar and her team possess a wealth of construction and business law expertise. Expertise to both guide a client away from litigation and, if not possible, to skillfully represent them in court.

Thierry Montoya

AlvaradoSmith APC

Mahyar Ghassemian and her firm are the best construction dispute litigators and negotiators in the industry. Mahyar is an expert in this area. Her firms knows the law and are very tenacious in obtaining the best results for their clients. I have been involved in very lengthy litigation as co-counsel in a very big case and jury trial. Mahyar is one of the hardest working and most effective advocates I have ever had the privilege of working with.

Paul Hoffman

Hoffman Legal Corporation

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