Thursday, October 28, 2010

Appellate Division Comments on Licensing Statutes and Right to Collect Payment

In Quick Start Const. Corp. v. Staiger (2010 NY Slip Op 07731) the Appellate Division, Second Department, reviewed a case where a home owner filed a motion for summary judgment dismissing a contractor's claims.  The owner argued that the contractor did not hold a valid Suffolk County Home Improvement license and, therefore, did not have the right or ability to pursue a claim for payment (a well established rule).  However, here, the contractor presented evidence that the corporation's principal did have a home improvement license.  In rejecting the owner's arguments the court notes that "corporations function only through the agency of others" and that the owners failed to establish that "the license did not encompass the plaintiff [corporation], as well as its principal [the holder of the license." 

While cases challenging an unlicensed contractor's right to bring a claim for payment are common, this case took the interesting spin of deciding whether a corporate principal's license is sufficient to allow the corporation to pursue payment.  In ruling that the principal's license supported the corporation's claim, contractors seem to have won a rare victory in an area of law that is heavily intended to protect home owning consumers. 

Vincent T. Pallaci is a partner at the New York law firm of Kushnick Pallaci, PLLC where his practice focuses primarily on the area of construction law.  He can be reached at (631) 752-7100 or

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