Appellate Court Applies Common Sense in Finding Scope of Work Did Not Require State License

APPELLATE COURT APPLIES COMMON SENSE IN FINDING SCOPE OF WORK DID NOT REQUIRE STATE LICENSE

By: Larry R. Leiby, Esq. and Robert S. Tanner, Esq.

About the Author: Larry Leiby, Esq. was the founder and first chairman of the Florida Bar Construction Law Committee in 1976. He is the author of the Florida Construction Law Manual. He is Board Certified in Construction Law and was on the Construction Law Certification Committee that creates and grades the tests for construction law board certification. He was awarded the lifetime achievement award by the Florida Bar Construction Law Committee and teaches construction law at the Florida International University College of Law. He can be reached at leiby@mkpalaw.com. For more information, please visit www.mkpalaw.com.

One of Florida's statutory sections governing contracts states:

(1) As a matter of public policy, contracts entered into on or after October 1, 1990, by an unlicensed contractor shall be unenforceable in law or in equity by the unlicensed contractor.

Fla. Stat., § 489.128.

That section effectively bars a contractor from recovering any monies owed for work requiring a license that is performed pursuant to a contract entered by a contractor who is not licensed to perform the work. The "threshold question" is whether the contractor attempting to enforce the contract was required to have a license for the type of work performed pursuant to the contract. Full Circle Dairy, LLC v. McKinney, 467 F.Supp. 2d 1343, 1345 (M.D. Fla. 2006).

In MMII, Inc. v. Silvester, 2010 WL 3239066 (Fla. 4 th DCA Aug. 18, 2010), MMI ("Contractor") entered into a contract with Michael and Marla Silvester ("Owners") for the design and installation of an elaborate entertainment system. Contractor sued Owners for failing to pay the entire amount due, and Owners argued that Contractor was unlicensed and was barred from enforcing the contract. The trial court agreed and denied Contractor's claim. Contractor appealed.

On appeal, Contractor argued that no license was required for its work of selling and installing audio entertainment systems. The appellate court reviewed section 489.105 and concluded that Contractor's work did not fall within the description for any of the specialty contractor's licenses. The appellate court also reviewed section 489.505 concerning electrical contractors and concluded that, although Contractor worked with low voltage electricity in its work, that did not automatically mean that Contractor's work was that of an electrical contractor. The appellate court agreed with the argument that "a person who repairs computers is not considered an electrician just because the computer plugs into the wall and uses electricity." It essentially concluded that requiring an audio entertainment system installer to be licensed as an electrical contractor would "significantly interfere with the common understanding of what it means to work in the electrical trade field." Accordingly, the appellate court reversed the trial court and held that Contractor's work did not require a state license.

Florida law takes very seriously the issue of unlicensed contracting. If you have any question whether your contract calls for a license that you do not have, it is better to determine the answer before starting any work because if it does, you may end up putting a lot of money into improving another person's property without being able to recover any of it.