Do you recognize this place?

This is 1350 Front Street in San Diego. In it you will find the State of California Office of Administrative Hearings. This is where dreams go to die. This is where the California Contractors State License Board’s (CSLB) accusations and investigations of negligence and intentional bad acts against contractors are heard before an administrative law judge aka ALJs. What’s an ALJ? They are not Article III judges who are appointed by the president or the governor. They are instead employees of the State of California. So what happens is that the CSLB files a complaint against a contractor and the State of California Attorney General’s office files it with the Office of Administrative Hearings. The CSLB is like hundreds of other State Bureaus, Offices, Departments that you’ve heard of. They are administrative agencies. They’re a fourth branch of government narrowly tailored to demand your compliance.

In these Accusations, you are free to represent yourself, but it would be a seriously bad idea to do so. The cases brought are peculiar because 99 out of 100 complaints by consumers or contractors or owners are handled through CSLB arbitration process or through a lawsuit. But for reasons only known probably to CSLB, they find some cases where they want to do the leg work of proving the complaining parties’ case.

The Attorney General’s Accusation is typically based on Sections 7109 and 7113 of the Business and Professions code. The first section permits the CSLB to discipline a contractor for “a willful departure in any material respect from accepted trade standards for good and workmanlike construction.” The second section permits discipline for failure to complete the work for the agreed upon price. What the effect of these sections is that any time you have a contested change order you may find yourself on the business end of a CSLB accusation. Further, any shortcuts on quality could similarly lead to an accusation.

 

So what’s the problem with an accusation?

It’s far worse than a lawsuit. With a lawsuit you could lose and be ordered to pay money. You can always file for bankruptcy and you get your fresh start. With an accusation, the CSLB is seeking punishment via either a revocation of your license or a suspension. Bankruptcy cannot stop this. Further, the CSLB will seek restitution for the failure to follow trade standards. Restitution orders when deemed a penalty, fine or forfeiture are also not dischargeable for three years.

If an accusation is filed against you, you need experienced counsel immediately. Do not take the chance with your livelihood. My fees in handling these matters are reasonable and you will be permitted to continue working while the accusation is pending.