Holland

Business and Professions Code section 7031 bars unlicensed contractors from bringing suit to recover compensation for work requiring a license. In this case, we hold that an unlicensed contractor may pursue an action under 42 United States Code section 1981 for racial discrimination during the performance of his contract, but may not seek damages for the defendant’s failure to pay sums due under the contract.

Henry Holland appeals from a judgment of dismissal entered after the trial court sustained a demurrer to Holland’s second amended complaint without leave to amend. Holland challenges the court’s ruling that his status as an unlicensed contractor foreclosed his civil rights claims. Holland also contends he alleged facts sufficient to exempt him from the license requirement. We disagree with Holland regarding the license requirement. However, we agree that his civil rights claims are viable, though they are subject to the limitation on damages imposed by Business and Professions Code section 7031. Therefore, we reverse.

Background

Holland’s original complaint included causes, of action for breach of contract, enforcement of a stop notice, recovery on a public works…