H.B.3222
(By Delegates Amores, Ellem and Moore )
[Introduced March 24, 2005; referred to
the Committee on the Government Organization.]
A BILL to amend and reenact §21-11-4, §21-11-5, §21-11-7, §21-11-10
and §21-11-14 of the code of West Virginia, 1931, as amended;
and to amend said code adding thereto a new section,
designated §21-11-21, all relating to licensed contractors;
increasing the membership of the West Virginia Contractor's
Licencing Board; individuals eligible to take examination;
additional information requested from applicants; presumption
in disputes without written contract; criteria for rejecting
license application or renewal; proof of license prerequisite
to civil action.
Be it enacted by the Legislature of West Virginia:
That §21-11-4, §21-11-5, §21-11-7, §21-11-10 and §21-11-14 of
the code of West Virginia, 1931, as amended, be amended and
reenacted; that said code be amended by adding thereto a new
section, designated §21-11-21, all to read as follows:
CHAPTER 21. LABOR
ARTICLE 11. WEST VIRGINIA CONTRACTOR LICENSING ACT.
§21-11-4. West Virginia contractor licensing board created;
members; appointment; terms; vacancies; qualifications; quorum
(a) There is hereby created the West Virginia contractor
licensing board. The board shall consist of
ten eleven members
appointed by the governor by and with the advice and consent of the
Senate for terms of four years.
The eleven appointed Such members
shall serve until their successors are appointed and have
qualified. Eight of the appointed members shall be owners of
businesses engaged in the various contracting industries, with at
least one member appointed from each of the following contractor
classes: One electrical contractor, one general building
contractor, one general engineering contractor, one heating,
ventilating and cooling contractor, one multifamily contractor, one
piping contractor, one plumbing contractor and one residential
contractor, as defined in section three hereof. Two of the
appointed members shall be building code officials who are not
members of any contracting industry.
One of the appointed members
shall be a person who by reason of previous training or experience
may reasonably be said to represent the viewpoint of consumers. At
least three members of the board shall reside at the time of their
appointment in each congressional district as existing on the first
day of January, one thousand nine hundred ninety-eight. The
commissioner of labor, the secretary of the department of tax and revenue or his designee, and the commissioner of the bureau of
employment programs or his designee shall be ex officio nonvoting
members of the board.
(b) Terms of the members first appointed shall be two members
for one year, two members for two years, three members for three
years and three members for four years, as designated by the
governor at the time of appointment. Thereafter, terms shall be
for four years. A member who has served all or part of two
consecutive terms shall not be subject to reappointment unless four
years have elapsed since the member last served. Vacancies shall
be filled by appointment by the governor for the unexpired term of
any member whose office is vacant and shall be made within sixty
days of the occurrence of the vacancy. A vacancy on the board
shall not impair the right of the remaining members to exercise all
the powers of the board.
(c) The board shall elect a chair from one of the voting
members of the board. The board shall meet at least once annually
and at such other times as called by the chair or a majority of the
board. Board members shall receive compensation not to exceed the
amount paid to members of the Legislature for the interim duties as
recommended by the citizens legislative compensation commission and
authorized by law for each day or portion of a day spent attending
meetings of the board and shall be reimbursed for all reasonable
and necessary expenses incurred incident to his or her duties as a
member of the board:
Provided that the compensation and expenses shall not be paid for the one appointed member who by reason of
previous training or experience may reasonably be said to represent
the viewpoint of consumers. A majority of the members appointed
shall constitute a quorum of the board.
§ 21-11-5. Administrative duties of the board; regulations
(a) Pursuant to the provisions of chapter twenty-nine-a of
this code, the board shall adopt rules and regulations relating to
the following:
(1) The minimum qualifications for applicants for examination
and license in each of the following specified classes of
contractor:
(A) Electrical contractor;
(B) General building contractor;
(C) General engineering contractor;
(D) Heating, ventilating and cooling contractor;
(E) Multifamily contractor;
(F) Piping contractor;
(G) Plumbing contractor;
(H) Residential contractor; or
(I) Specialty contractor;
Provided, That the individual taking an examination on behalf of an
entity seeking licensure as a residential contractor shall be the
owner, a partner, or a corporate officer of the entity.
(2) The content of examinations for applicants in each class;
(3) Procedures for application, examination and license renewal, and the manner in which the examination will be conducted;
(4) The continued competency of licensees for purposes of
renewal and reinstatement of licenses; and
(5) Procedures for disciplinary action before the board.
(b) The board shall:
(1) Hold at least one examination in each calendar quarter for
each specific classification of contractor, designate the time and
place of such examinations, and notify applicants thereof;
(2) Request, through the division, investigation of any
alleged violation of this article or of the regulations;
(3) Forward results of examinations to the division within
twenty days following the examination;
(4) Notify the commissioner and board members of meeting dates
and agenda items at least five days prior to such meetings; and
(5) Take minutes and records of all meetings and proceedings.
§21-11-7. Application for and issuance of license.
(a) A person desiring to be licensed as a contractor under
this article shall submit to the board
, in a form to be prescribed
by the board, the following information:
(1) The name, social security number and physical address of
the applicant;
(2) The name, address and principal occupation:
(A) Of each person who, as a stockholder or otherwise, has
a proprietary interest of ten percent or more in the applicant;
(B) Of each officer and director of a corporate applicant;
(C) Of each trustee and beneficiary of an applicant which
is a trust; and
(D) Where a corporation has a proprietary interest of
twenty-five percent or more in an applicant, the name, address and
principal occupation of each officer and director of the
corporation;
(3) Such additional information as the board may require and
as may be necessary to show that the applicant is in compliance
with the standards for contractors as established by this article
and the rules lawfully promulgated by the board hereunder
information. a written application requesting licensure, providing
the applicant's social security number and such other information
as the board may require on forms supplied by the board.
The applicant shall pay a license fee not to exceed one hundred
fifty dollars:
Provided, That electrical contractors already
licensed under section four, article three-b, chapter twenty-nine
of this code shall pay no more than twenty dollars.
(b) A person holding a business registration certificate to
conduct business in this state as a contractor on the thirtieth day
of September, one thousand nine hundred ninety-one, may register
with the board, certify by affidavit the requirements of subsection
(c), section fifteen of this article and pay such license fee not
to exceed one hundred fifty dollars and shall be issued a
contractor's license without further examination:
Provided, That no
license may be issued without examination pursuant to this subsection after the first day of April, two thousand two:
Provided, however, That any person issued a contractor's license by
the board pursuant to this subsection may apply to the board for
transfer of the license to a new business entity in which the
license holder is the principal owner, partner or corporate
officer:
Provided further, That a license holder may hold a license
on behalf of only one business entity during a given time period.
The board may transfer the license issued pursuant to this
subsection to the new business entity without requiring examination
of the license holder
§21-11-10. Prerequisites to obtaining building permit; mandatory
written contracts.
(a) Any person making application to the building inspector or
other authority of any incorporated municipality or other political
subdivision in this state charged with the duty of issuing building
or other permits for the construction of any building, highway,
sewer or structure or for any removal of materials or earth,
grading or improvement, shall, before issuance of the permit,
either furnish satisfactory proof to the inspector or authority
that such person is duly licensed under the provisions of this
article to carry out or superintend the same, or file a written
affidavit that such person is not subject to licensure as a
contractor or subcontractor as defined in this article. The
inspector or authority may not issue a building permit to any person who does not possess a valid contractor's license when
required by this article.
(b) Effective the first day of October, two thousand two, no
person licensed under the provisions of this article may perform
contracting work of an aggregate value of ten thousand dollars or
more, including materials and labor, without a written contract,
setting forth a description and cost of the work to be performed,
signed by the licensee and the person for whom the work is to be
performed
, Provided that, in an civil action in any court of the
state involving a dispute as to the terms of an agreement for
contracting services in an amount in excess of two thousand five
hundred dollars involving a residential structure intended for
residential occupancy, the person for whom the work is or was to be
performed shall be entitled to a rebuttable legal presumption
against the contractor as to the terms of the agreement when the
contractor fails to execute a written contract. The presumption
may be rebutted by clear and convincing evidence of the terms of
the parties' agreement.
(c) On or before the first day of June, two thousand two, the
board shall file a procedural rule setting forth a standard
contract form which meets the minimum requirements of this
subsection for use by licensees. The board shall post the contract
form on its website and shall assist licensees in the correct
completion of the form. On or before the first day of August, two
thousand two, the board shall mail a written notice of the requirements imposed by the rule to each licensed contractor at the
address provided to the board by the contractor on his or her last
application for licensure or renewal.
§21-11-14. Disciplinary powers of the board
(a) The board has the power and authority to impose the
following disciplinary actions:
(1) Permanently revoke a license;
(2) Suspend a license for a specified period;
(3) Censure or reprimand a licensee;
(4) Impose limitations or conditions on the professional
practice of a licensee;
(5) Impose requirements for remedial professional education to
correct deficiencies in the education, training and skill of a
licensee;
(6) Impose a probationary period requiring a licensee to
report regularly to the board on matters related to the grounds for
probation; the board may withdraw probationary status if the
deficiencies that require the sanction are remedied; and
(7) Order a contractor who has been found, after hearing, to
have violated any provision of this article or the rules of the
board to provide, as a condition of licensure, assurance of
financial responsibility. The form of financial assurance may
include, but is not limited to, a surety bond, a cash bond, a
certificate of deposit, an irrevocable letter of credit or
performance insurance: Provided, That the amount of financial assurance required under this subdivision may not exceed the total
of the aggregate amount of the judgments or liens levied against
the contractor or the aggregate value of any corrective work
ordered by the board or both: Provided, however, That the board may
remove this requirement for licensees against whom no complaints
have been filed for a period of five continuous years.
(b) No license issued under the provisions of this article may
be suspended or revoked without a prior hearing before the board:
Provided, That the board may summarily suspend a licensee pending
a hearing or pending an appeal after hearing upon a determination
that the licensee poses a clear, significant and immediate danger
to the public health and safety.
(c) The board may reinstate the suspended or revoked license
of a person, if, upon a hearing, the board finds and determines
that the person is able to practice with skill and safety.
(d) The board may accept the voluntary surrender of a license:
Provided, That the license may not be reissued unless the board
determines that the licensee is competent to resume practice and
the licensee pays the appropriate renewal fee.
(e) A person or contractor adversely affected by disciplinary
action may appeal to the board within sixty days of the date the
disciplinary action is taken. The board shall hear the appeal
within thirty days from receipt of notice of appeal in accordance
with the provisions of chapter twenty-nine-a of this code. Hearings
shall be held in Charleston. The board may retain a hearing examiner to conduct the hearings and present proposed findings of
fact and conclusions of law to the board for its action.
(f) Any party adversely affected by any action of the board
may appeal that action in either the circuit court of Kanawha
County, West Virginia, or in the circuit court of the county in
which the petitioner resides or does business, within thirty days
after the date upon which the petitioner received notice of the
final order or decision of the board.
(g) The following are causes for disciplinary action:
(1) Abandonment, without legal excuse, of any construction
project or operation engaged in or undertaken by the licensee;
(2) Willful failure or refusal to complete a construction
project or operation with reasonable diligence, thereby causing
material injury to another;
(3) Willful departure from or disregard of plans or
specifications in any material respect without the consent of the
parties to the contract;
(4) Willful or deliberate violation of the building laws or
regulations of the state or of any political subdivision thereof;
(5) Willful or deliberate failure to pay any moneys when due
for any materials free from defect, or services rendered in
connection with the person's operations as a contractor when the
person has the capacity to pay or when the person has received
sufficient funds under the contract as payment for the particular
construction work for which the services or materials were rendered or purchased, or the fraudulent denial of any amount with intent to
injure, delay or defraud the person to whom the debt is owed;
(6) Willful or deliberate misrepresentation of a material fact
by an applicant or licensee in obtaining a license, or in
connection with official licensing matters;
(7) Willful or deliberate failure to comply in any material
respect with the provisions of this article or the rules of the
board;
(8) Willfully or deliberately acting in the capacity of a
contractor when not licensed or as a contractor by a person other
than the person to whom the license is issued except as an employee
of the licensee;
(9) Willfully or deliberately acting with the intent to evade
the provisions of this article by: (i) Aiding or abetting an
unlicenced person to evade the provisions of this article; (ii)
combining or conspiring with an unlicenced person to perform an
unauthorized act; (iii) allowing a license to be used by an
unlicenced person; or (iv) attempting to assign, transfer or
otherwise dispose of a license or permitting the unauthorized use
thereof;
(10) Engaging in any willful, fraudulent or deceitful act in
the capacity as a contractor whereby substantial injury is
sustained by another;
(11) Performing work which is not commensurate with a general
standard of the specific classification of contractor or which is below a building or construction code adopted by the municipality
or county in which the work is performed;
(12) Knowingly employing a person or persons who do not have
the legal right to be employed in the United States;
(13) Failing to execute written contracts prior to performing
contracting work, in accordance with section ten of this article;
(14) Failing to satisfy a valid judgment issued by a court of
competent jurisdiction for an act, representation, transaction or
conduct which is in violation of this article or the rules adopted
pursuant to this article: Provided, That, for the purposes of this
paragraph, a judgement is satisfied if the contractor has entered
into an agreement to make periodic payments to satisfy the
judgement and is current on those payments,
or
(14) (15) Failing to abide by an order of the board.
(h) In all disciplinary hearings the board has the burden of
proof as to all matters in contention. No disciplinary action may
be taken by the board except on the affirmative vote of at least
six members thereof. Other than as specifically set out herein, the
board has no power or authority to impose or assess damages.
(i) On or before the first day of January, two thousand one,
the board shall propose rules for legislative approval in
accordance with the provisions of article three, chapter
twenty-nine-a of this code which shall specify a procedure for the
investigation and resolution of all complaints against persons licensed under this chapter.
(j) No license shall be granted or renewed to an applicant for
a license if the individual sole owner of the applicant, or if a
partner, corporate officer or owner of record or beneficially of
ten percent or more of any class of stock of the applicant was an
individual sole owner of a contractor, or a partner, corporate
officer or owner of record or beneficially of ten percent or more
of any class of stock of a contractor:
(1) whose license is permanently revoked;
(2) whose license is currently suspended;
(3) who has failed to comply with a disciplinary order of the
board authorized by subsection (a) of this section, or
(4) who has failed to satisfy a valid judgment issued by a
court of competent jurisdiction for an act, representation,
transaction or conduct which is in violation of this article or the
rules adopted pursuant to this article: Provided, That, for the
purposes of this paragraph, a judgement is satisfied if the
contractor has entered into an agreement to make periodic payments
to satisfy the judgement and is current on those payments.
(k) The Board may grant or new a license for an applicant that
has had the granting or renewal of its license denied pursuant to
the provisions of subparagraph (j) of this section may if, more
than one year after conduct which resulted in the denial, upon a
hearing, the board finds and determines that there is good cause to
grant or renew the license notwithstanding the actions taken pursuant to subsection (j) of this section, that the conduct
resulting in actions taken were not part of a pattern, and that
there is good caus to believe that it is unlikely that conduct
resulting in the actions taken is unlikely to occur again.
§21-11-21. Proof of license as prerequisite to civil action
No contractor shall act as agent or commence or maintain any
action in any court of the state for collection of compensation for
the performance of a written or oral contract in connection with
the construction, repair or improvement of an owner-occupied
residential structure for which a license is required by this
article and where the person for whom the work is or was to be
performed presents prima facia evidence that the residential
contractor has engaged in an act prohibited by subsection (g),
section fourteen of this article without alleging and proving that
the residential contractor was a duly licensed contractor when the
contract sued upon was entered into and when the alleged cause of
action arose.
Note: The bill increases the composition of the Contractor's
Licensing Board by adding a consumer advocate. Additionally, it
makes it more difficult for a contractor whose license has been
revoked, suspended or who has been otherwise disciplined, to obtain
another license. The bill creates a rebuttable presumption against
contractors who do not execute a written contract for contracting
services in excess of $2,500
that involves a residential structure
when there is a dispute as to the terms of a contract. Finally,
requires a residential contractor to provide proof of a contractor
license as a prerequisite to maintaining a civil action the
collection of compensation for the performance of any act for which
a license is required when the contract involves an owner-occupied
residential structure and the homeowner provides prima facie evidence of a violation of section 14(g).
Strike-throughs indicate language that would be stricken from
the present law, and underscoring indicates new language that would
be added.