MW Erectors, Inc. v. Niederhauser Ornamental & Metal Works Co.

To protect the public, the Contractors’ State License Law (CSLL; Bus. & Prof. Code, § 7000 et seq.) imposes strict and harsh penalties for a contractor’s failure to maintain proper licensure. Among other things, the CSLL states a general rule that, regardless of the merits of the claim, a contractor may not maintain any action, legal or equitable, to recover compensation for “the performance of any act or contract” unless he or she was duly licensed “at all times during the performance of that act or contract.’'’ (§ 7031, subd. (a) (section 7031(a)), italics added.)

Earlier case law softened the severity of this scheme by allowing contractors, though technically unlicensed at the time of performance, to show they had substantially complied with licensure requirements. However, the CSLL has since limited the availability of the substantial compliance exception. In particular, the statute specifies that “[t]he judicial doctrine of substantial compliance shall not apply” unless the contractor “had been duly licensed as a contractor in this state prior to the performance of the act or contract’ for which licensure was required. (§ 7031, subd. (e), italics added; cf. id.,…