This paper addresses some of the more important features of contractor licensing laws in the United States of which practitioners and their clients should be aware before embarking on a construction venture, and some key court cases interpreting those laws. Additionally, while a survey of all the various state contractor licensing laws is beyond the scope of this paper, the appendix, entitled “Summary of Selected State Contractor Licensing Laws” (“Licensing Summary”), highlights some of the more important features of contractor licensing laws in a selection of states. The Licensing Summary is intended to alert practitioners to the importance of educating themselves on the requirements of any jurisdiction in which their construction projects are undertaken, and the severe risks of failing to do so.

As indicated in the Licensing Summary (page 43), the licensing requirements for general contractors and trade contractors vary significantly from state to state. Many states (including Illinois, Maine, Michigan, Ohio, Pennsylvania, and Vermont) do not require general contractors to be licensed at all, but do require certain specific trade contractors to be licensed. In a number of other states lacking statewide licence requirements for general contractors (including New Jersey and New York), many counties and municipalities require licences.

While the penalties for working without a valid licence where one is required are similarly varied, some common ones can be found in most states. Fines and penalties are often assessed, and many states also prohibit an unlicensed contractor from suing to recover amounts due under the contract.

My own state of California has a very specific and much tested contractor licensing scheme applicable to both general contractors and specific trades. See the California Business and Professions Code, Section 7031 (“Section