Contractor Negligence FAQ

Contractor negligence in California occurs when a licensed or unlicensed contractor fails to perform construction work with the degree of care, skill, and competence that a reasonably prudent contractor would exercise under similar circumstances. Under California Business and Professions Code Section 7000 et seq. (the Contractors State License Law), contractors are held to professional standards and can be liable for negligent work.

To establish contractor negligence, you must prove four elements: the contractor owed you a duty of care arising from the contractual relationship or professional standards, the contractor breached that duty by performing substandard work, the breach caused your damages, and you suffered actual harm or financial losses. Common forms of contractor negligence include failing to follow building codes, using substandard materials, improper installation of systems, deviating from approved plans, failure to obtain required permits, and abandoning projects without completion. California Civil Code Sections 895-945.5 (commonly known as SB 800 or the Right to Repair Act) establishes specific construction standards for residential construction and provides alternative dispute resolution procedures before litigation.

Filing a complaint with the Contractors State License Board (CSLB) is an important step when you've experienced contractor misconduct or negligence in California. Under Business and Professions Code Section 7090, the CSLB has authority to investigate complaints and impose discipline on licensed contractors. To file a complaint, visit the CSLB website or call their consumer hotline to obtain a complaint form.

Your complaint should include the contractor's name, license number, and contact information, a detailed description of the alleged violations or deficient work, copies of your written contract, change orders, and payment records, photographs documenting defective work, correspondence between you and the contractor, and a description of any financial harm suffered. After receiving your complaint, the CSLB will assign an investigator who may inspect the work, interview parties, and gather evidence. Possible outcomes include dismissal if no violation is found, a letter of warning, citation with civil penalties up to $15,000 per violation, suspension or revocation of the contractor's license, or an order to correct defective work. The CSLB complaint process is separate from a civil lawsuit and does not provide direct financial compensation—for monetary recovery, you must pursue a civil claim or arbitration.

Hiring an unlicensed contractor in California has significant legal consequences that generally favor the homeowner. Under California Business and Professions Code Section 7031, an unlicensed contractor cannot sue to collect payment for work performed, regardless of the quality of work or whether you agreed to pay. This is a complete bar to recovery by the contractor.

More importantly, Section 7031(b) allows you to recover all compensation paid to an unlicensed contractor for work requiring a license, plus interest, even if the work was satisfactory. This disgorgement remedy can be substantial. Additionally, unlicensed contracting is a misdemeanor under Business and Professions Code Section 7028, punishable by fines and potential imprisonment, though criminal prosecution doesn't provide you direct compensation. From a practical standpoint, unlicensed contractors typically lack insurance and bonding, making it harder to collect damages if their work is defective. You may have stronger negligence claims against unlicensed contractors since they clearly violated professional standards by operating illegally. However, your own ability to recover may be limited if there's no insurance or assets. Always verify contractor licensing through the CSLB website before signing any contract.

California has multiple statutes of limitations that may apply to construction defect claims, depending on the type of defect and legal theory. For latent defects (hidden defects not discoverable through reasonable inspection), California Code of Civil Procedure Section 337.15 provides a 10-year statute of repose from the date of substantial completion of the improvement. Within this 10-year period, you must file suit within four years of discovering the defect under Code of Civil Procedure Section 337 for written contracts or three years for damage to property under Section 338.

Patent defects (defects that are open and obvious) must generally be discovered and sued upon within four years of completion for breach of contract claims or three years for negligence claims. The Right to Repair Act (Civil Code Sections 895-945.5) establishes its own time limits for residential construction: depending on the component involved, claims must be brought within one to ten years from close of escrow. For example, plumbing and sewer system claims must be brought within four years, while foundation claims have ten years. These statutes are complex and interact with each other—if you suspect construction defects, consult an attorney promptly to ensure your claims are preserved.

Yes, you can sue your contractor for construction defects in California under several legal theories. Breach of contract claims arise when the contractor fails to perform according to the terms of your written or oral agreement, including failing to meet specifications, using inferior materials, or not completing work. Negligence claims address situations where the contractor's work fell below the standard of care expected of a reasonably competent contractor, causing property damage or financial loss.

Breach of implied warranties applies because California law implies warranties in construction contracts including the warranty of habitability for residential construction and the warranty of fitness for a particular purpose. Fraud or misrepresentation claims may apply if the contractor made false statements about qualifications, materials, or work quality. For residential construction, the Right to Repair Act (Civil Code Sections 895-945.5) establishes specific construction standards and requires pre-litigation procedures including notice to the contractor and an opportunity to inspect and offer repairs before you can file suit. Damages may include the cost to repair or complete the work, diminished property value, loss of use of your property, temporary housing costs, and in some cases attorney's fees if your contract includes a fee provision.

California's Right to Repair Act, codified in Civil Code Sections 895-945.5 and commonly called SB 800, fundamentally changed how residential construction defect claims are handled. The Act applies to new residential construction (not remodeling) where the original purchase occurred after January 1, 2003. It establishes specific performance standards for virtually every building component including foundations, structural systems, plumbing, electrical, roofing, waterproofing, and more.

Before filing a lawsuit, homeowners must follow mandatory pre-litigation procedures: you must provide written notice to the builder describing the claimed defects, the builder then has a right to inspect the property within a specified time period, and the builder can offer to repair the defects or compensate you. Only after completing this process—or if the builder fails to respond—can you file suit. If the builder offers repairs and you reject them, your ability to recover damages may be limited. The Act provides builders with defenses if they can show the defect was caused by unforeseen conditions, acts of nature, unreasonable use by the homeowner, or failure to maintain the property. While the Act was intended to reduce litigation, it actually establishes clear standards that can make proving defects easier and provides statutory remedies that may be more favorable than common law claims.

Damages recoverable from a negligent contractor in California depend on your legal theory but generally aim to put you in the position you would have been in had the contractor performed properly. Cost of repair is the primary damage measure and includes what it will cost to fix the defective work, either by hiring another contractor or the original contractor under court supervision. If repair costs would be unreasonable (exceeding the property's value), you may instead recover diminished property value—the difference between your property's value as warranted versus its actual value with defects.

Completion costs apply when a contractor abandoned an incomplete project, covering what it costs to hire another contractor to finish. Consequential damages include expenses flowing from the defect such as temporary housing during repairs, damaged personal property, lost rental income, and increased utility costs from inefficient systems. If you had a written contract with an attorney's fees provision, you may recover litigation costs. Under Civil Code Section 3294, punitive damages may be available if the contractor acted with fraud, malice, or oppression, such as intentionally using substandard materials while billing for quality materials. The Right to Repair Act provides specific damage formulas for residential construction defects that may override common law damage calculations.

Verifying contractor licensing is essential before signing any contract and is easy to do in California through the Contractors State License Board. Visit the CSLB website at cslb.ca.gov and use the License Check feature. Enter the contractor's license number or business name to access their license status (active, inactive, suspended, or revoked), license classification specifying what work they're authorized to perform, bond information confirming they have the required contractor's bond, workers' compensation insurance status or exemption certificate, business address and responsible party names, and any disciplinary history or complaints.

Under Business and Professions Code Section 7027.2, contractors must include their license number on all contracts, business cards, and advertisements, so you should have this number readily available. Be wary of contractors who cannot provide a license number or whose license doesn't cover the type of work you need—a general building contractor (B license) cannot perform specialized electrical work requiring a C-10 license without proper subcontractor arrangements. Additionally, verify the contractor has adequate liability insurance beyond the minimum bond requirement, as the standard $25,000 contractor bond may be insufficient for significant projects or damages.

California law mandates specific requirements for home improvement contracts under Business and Professions Code Section 7159. Every written contract must include the contractor's name, business address, and license number, the date of the transaction, a detailed description of the work to be performed including materials and specifications, agreed-upon price stating total contract amount and payment terms, approximate start and completion dates, and a notice explaining the homeowner's right to cancel within three business days for contracts signed at your home.

For contracts over $500, the law requires a payment schedule that limits down payments to $1,000 or 10% of the contract price, whichever is less, and ties subsequent payments to completion of specific work phases. The contract should specify who obtains permits, insurance requirements, warranty terms, change order procedures, and dispute resolution mechanisms such as mediation or arbitration. Include provisions addressing what happens if unforeseen conditions arise, how delays will be handled, and the contractor's cleanup responsibilities. Attorney's fees provisions can help recover litigation costs if disputes arise. While oral contracts are technically enforceable, they're extremely difficult to prove—always insist on a detailed written contract before work begins. Keep copies of all documents, change orders, payment records, and correspondence throughout the project.

Yes, you may be able to recover from a contractor's license bond if you cannot collect directly from the contractor. Under California Business and Professions Code Section 7071.5, licensed contractors must maintain a $25,000 contractor's bond (or $100,000 for C-39 roofing contractors) as a condition of licensure. This bond is designed to protect consumers who suffer damages from licensed contractor misconduct or negligence.

To make a claim against the bond, you typically need a court judgment or arbitration award against the contractor, or the contractor's admission of liability. The surety company that issued the bond will investigate your claim and may require documentation including your contract, evidence of defective work or non-performance, proof of damages, and proof that the contractor has not paid. Be aware that the bond amount is an aggregate limit—multiple claimants share the available bond, and prior claims may have depleted it. The $25,000 bond often proves inadequate for substantial construction defects, which is why verifying the contractor has robust general liability insurance is equally important. The CSLB can provide bond information through their license lookup. If the bond has been exhausted or the contractor was unlicensed (meaning no bond exists), you may need to pursue other collection methods or accept that recovery may be limited.