Contractor Legality

I received a phone call today from a potential customer who needed a repair on her ceiling due to a leak from the upstairs apartment. She went into great detail about how she is “battling” the upstairs neighbor to get reimbursement from him to repair her ceiling.

The homeowner wanted me to open the wall to investigate for mold and any other potential problems. However, I informed her that this would not be appropriate unless she hired us. She then proceeded to explain to me that the upstairs neighbor would not pay for “exploration.” In response, I notified her that legally, I needed to work for her and not the upstairs neighbor given that she is the homeowner. She was upset, stating that she might not get reimbursed by the upstairs neighbor. On that note, I respectfully declined the project.

The contracting business can involve some complex insurance and legal requirements. For example, there is a home-improvement contractor license maintained by the state, general liability insurance (which would cover property damage incurred while working at the jobsite), and worker-compensation insurance (which would cover a worker getting injured on the jobsite). In addition, the contractor is only allowed to work for a direct homeowner. Imagine if a tenant called looking to knock down walls, etc. In such cases, the contractor could in theory be liable to the homeowner for unapproved work contracted by the tenant.