County of Los Angeles Department of Consumer Affairs New Consumer Laws 2009

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CONTRACTORS – HIGHER AMOUNT ALLOWED FOR SMALL CLAIMS LAWSUITS

SB 1432, Business & Professions Code 7071.5, 7071.10, 071.11; Code of Civil Procedure 116.220

Home improvement contractors are required to post a $12,500 bond. Consumers damaged by a home improvement contractor as a result of a willful and deliberate violation of the Contractors State License Law can sue in Small Claims Court. If the action is against the Contractors State License Board as surety on the bond or against any other bondholder that does not charge a fee, the Small Claims Court limit is $7,500. If the lawsuit is against a surety that does not charge for its services, the limit is $2,500. If it is against a bondholder that charges a fee, the limit is $4,000.

This new law increases the maximum Small Claims Court jurisdiction from $4,000 to $6,500 for an owner of a single family dwelling against the surety of a bond that charges for its services. This new law no longer requires proof of willful and deliberate violation of the licensing law.

This law does not apply if the consumer intends to sell or offers to sell the dwelling when the violation occurred.

For more information:
County of Los Angeles Department of Consumer Affairs
B-96 Kenneth Hahn Hall of Administration
500 W. Temple Street * Los Angeles, CA 90012-2706
Telephone (800) 593-8222 (within the County) * (213) 974-1452
Web site: dca.lacounty.gov