In April 2024, an Appellate court in New York dismissed a contractor’s claim against a property owner for unpaid electrical work for failure to hold a license. Electrical Contracting Solutions Corp. v. Trump Village Section 4, Inc., 2024 NY Slip Op 01907 (2nd Dept. 2024).
In Trump Village, the property owner hired an electrical contractor to perform electrical work in an apartment complex in Brooklyn, N.Y. Because the contractor was not licensed to perform electrical work, it used the license of another electrical contractor to pull the permit and thereafter perform the work.
Although the contractor prevailed at trial against the property owner for unpaid electrical work in the sum of $458,584.84, on appeal, the appellate court dismissed the claim under Section 27-3017 (a) of the New York City Administrative Code which states that it is unlawful for any person to perform electrical work in the City of New York without a valid license.
In dismissing the claim, the court rejected the contractor’s argument that it should be paid because it hired a licensed electrical subcontractor to perform the work, stating - “[s]o strict has been … the statutory requirement … [it] may not be satisfied by employing or subletting the work to an appropriately licensed person".
Comment:
It is not unusual for an unlicensed contractor to use another contractor’s license to obtain a permit and thereafter perform electrical or plumbing work within the City of New York. While this may be common practice, should a dispute ever arise regarding payment for said work, a contractor subletting the work in this manner may ultimately be barred from recovering a balance due under a contract it has with an owner or other party.
About the author: George Marco is an attorney practicing in the field of construction law. He also holds a Bachelor of Science in Mechanical Engineering and was previously employed as a Project Manager for a public improvement contractor.
If you would like more information regarding this topic or any other related to construction law please contact George Marco at george@gmarcolaw.com or call (516) 464-2320.
Disclaimer: This article is for informational purposes only and not intended to serve as legal counsel.
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