If my home was built by a non licensed contractor is he still responsible for bad work?
Full Question:
Answer:
Courts will not enforce contracts that are illegal or violate public policy. Such contracts are considered void. If the illegal agreement has not been performed, neither party can sue the other for damages or to require performance of the agreement. If the agreement has been performed,
neither party can sue the other for damages or have the agreement set aside.
In the case of Knight v. Johnson, 741 S.W.2d 842 (Mo. Ct. App. 1987), Knight did not have a real estate license nor did he claim to. However, Johnson asked Knight to find a buyer for Johnson's car wash in exchange for Johnson paying Knight a 15% commission if Knight could find a buyer. Knight obtained a buyer and was paid one-half of the commission. Johnson refused to pay any more commission. Knight sued Johnson for the remaining commission. The Court ruled in favor of Johnson as to the unpaid commission since the licensing statute was violated by Knight acting as a broker without a license. The agreement to pay him commission was therefore void and could not be enforced. Johnson also claimed that Knight should not be entitled to keep the commission he had received. The Court held that although Knight had no right to the commission, he had been paid and the Court would not aid either party to the illegal contract. Therefore,
Johnson could not recover from Knight the commission that had already been paid.
In most cases, parties to an illegal agreement are denied remedies of any nature. A Court will not require parties to perform an illegal agreement, and a Court will not award damages because a party fails to perform.
Statutes frequently require that a person obtain a license or certificate before practicing certain professions such as law or medicine, or before carrying on a particular business such as that of a real estate broker or stock broker. If the license is required to protect the public from unqualified
persons, such as an unlicensed physician, the contract made by the unlicensed person is void. In a North Carolina case, a statute required that contractors be licensed. An unlicensed contractor made a contract to make repairs. The Court held that the contractor could not recover from the
owner either the price agreed to in their contract or the reasonable value of the services actually performed since the contractor was unlicensed.
If a license is strictly a revenue raiser, such as a privilege license to conduct a store at a particular location, it would be rare for an agreement made in violation of the licensing statute to be held invalid. Someone operating a store without a permit would not have all of its sales declared void, but it might be fined for failure to obtain the appropriate license.
