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HF 3944

as introduced - 90th Legislature (2017 - 2018) Posted on 03/21/2018 02:14pm

KEY: stricken = removed, old language.
underscored = added, new language.

Current Version - as introduced

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A bill for an act
relating to civil actions; modifying recovery actions against unlicensed contractors;
proposing coding for new law in Minnesota Statutes, chapter 326B.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

new text begin [326B.841] RECOVERY AGAINST UNLICENSED CONTRACTORS.
new text end

new text begin Subdivision 1. new text end

new text begin Unlicensed contractors. new text end

new text begin Except as provided under subdivision 5, a
residential contractor may not bring or maintain any action, or recover in law or equity in
any action, in any court of this state for the collection of compensation for the performance
of any act or contract where a license is required under section 326B.805, subdivision 1,
without alleging that the contractor was duly licensed at all times during the performance
of that act or contract, regardless of the merits of the cause of action brought by the
contractor. For the purposes of this section, "residential contractor" or "contractor" means
any of the trades licensed under section 326B.805, subdivision 1.
new text end

new text begin Subd. 2. new text end

new text begin Recovery against unlicensed contractors. new text end

new text begin Except as provided under subdivision
5, a person who utilizes the services of an unlicensed contractor may bring an action in any
court of competent jurisdiction in this state or recover all compensation paid to the unlicensed
contractor for performance of any act or contract.
new text end

new text begin Subd. 3. new text end

new text begin Security liens. new text end

new text begin A security interest taken to secure any payment for the
performance of any act or contract for which a license is required by section 326B.805,
subdivision 1, is unenforceable if the person performing the act or contract was not a duly
licensed contractor at all times during the performance of the act or contract.
new text end

new text begin Subd. 4. new text end

new text begin Controverted licensure. new text end

new text begin If the contractor's license is controverted, then the
contractor must provide proof of licensure must be made by production of a certificate of
licensure issued by the commissioner that establishes that the contractor was duly licensed
in the proper classification of contractors at all times during the performance of any act or
contract covered by the action. Nothing in this subdivision shall require any person or entity
controverting licensure or proper licensure to produce a verified certificate. When licensure
is controverted, the burden of proof to establish licensure shall be on the licensee.
new text end

new text begin Subd. 5. new text end

new text begin Substantial compliance. new text end

new text begin The judicial doctrine of substantial compliance shall
not apply under this section where the person who engaged in the business or acted in the
capacity of a contractor has never been a duly licensed contractor in the state. However, for
the purposes of this section, a contractor may be deemed to have substantially complied
with the licensure requirements of section 326B.805, subdivision 1, if it is shown at the
evidentiary hearing that the person who engaged in the business or acted in the capacity of
a contractor (1) had been duly licensed as a contractor in this state prior to the performance
of the act or contract, (2) acted reasonably and in good faith to maintain proper licensure,
and (3) acted promptly and in good faith to remedy the failure to comply with the licensure
requirements upon learning of the failure.
new text end