Home Improvement Contractors Beware

Dear clients-if you operate a home improvement business and are inclined to sue a homeowner who failed to pay for your services, take heed.

Home improvement contractors must abide by an ever-increasing “thicket” of consumer protection statutes. The Pennsylvania Home Improvement Consumer Protection Act, (“HICPA”) is one such statute. 73 P.S.§ 517.7(a) of HICPA states-“No home improvement contract shall be valid or enforceable against a homeowner unless it: (1) is in writing and legible and contains the home improvement contractor registration number of the performing contractor….”

Most PA home improvement contractors are aware that they must register with the Pennsylvania Attorney’s General Office Bureau of Consumer Protection and obtain a registration number.  Many contractors, however, fail to include that registration number on all advertisements, contracts, estimates and proposals.  See §517.6 of HICPA. This typically occurs when contractors use a “boilerplate” proposal for both commercial and residential jobs. This problem is further compounded when a contractor needs to commence litigation against homeowners who fail to pay for work.  Not only is the  contractor’s contract invalid and unenforceable, but it becomes grounds for a counterclaim by a homeowner against the contractor.

Home Improvement Contract

It gets worse.  If a home improvement contract contains any of the following clauses, the contract is voidable by the owner:

  1. a hold harmless clause;
  2. a waiver of Federal, State or local health, life, safety or building code requirements;
  3. a Confession of Judgment Clause;
  4. a waiver of any rights to a jury trial in any action brought by or against the owner;
  5. an assignment of or order for payment of wages or other compensation for services;
  6. a provision by which the owner agrees not to assert any claim or defense arising out of the contract;
  7. a provision that the contractor shall be awarded attorney fees and costs;
  8. a clause by which the owner relieves the contractor from liability for acts committed by the contractor or the contractor’s agents in the collection of any payments or in the repossession of any goods;
  9. a waiver of any rights provided under HICPA;
  10. a provision providing for the automatic or recurring renewal of any provisions of the agreement;

A violation of HICPA is a per se violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law, and in certain cases, a violation of the Fair Debt Collection Practices Act.  An unwary home improvement contractor who sues a homeowner under a non-conforming contract could, unwittingly have to pay that homeowner money damages, attorney’s fees and possibly treble damages.

HICPA compliance inquiries may be sent to msiddons@siddonslaw.com or (484) 614-6546.

Copyright 2013 Michael A. Siddons, Esquire. All rights reserved.  No part of this publication may be reproduced or transmitted in any form, including photocopy, without written permission from Michael A. Siddons, Esquire. Legal Disclosure: The information contained herein, is not intended to – and does not – create an attorney-client relationship. This article is not intended to provide legal advice, and readers should refrain from acting on information contained herein without seeking specific legal advice from individually qualified counsel.

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