Q: Licensing question
I hired a licensed contractor to perform home improvement to my house. Our contract specified that subcontractors must be licensed and the contractor signed an attestation that his subcontractor held an active contracting license. I’m now finding that the subcontractor holds a business license which allows him to perform construction on commercial property only. The license carries the words “Not for Home Improvement”. The contractor is saying that because Maryland law allows an unlicensed sub to work under his license, he has fulfilled his obligation regarding licensing. I feel that he committed fraud because the ability to work under his license does not make him licensed.
A: Unless there is unworkmanlike performance by the sub, a Court is unlikely to find this to be a material breach sufficient for you to declare the contract terminable. Therefore, I would let that argument go. If you had specifically provided that all subs must hold an MHIC license and that this term is a condition precedent to hiring them, and provide for immediate cancellation of the contract in the event any sub is not, then maybe you’d have a shot. Courts will not allow a complete forfeiture of a contracting party’s rights under a contract for a breach that does not actually cause a loss or harm, or only a minimal harm.
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