following tips will help you avoid licensing-related problems.
This article appeared in the May 2013 "Construction
Advisor" published by Lang & Klain and was updated in April 2014.
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Do you have a quick question about this topic? Call
Mike Thal or Kent Lang (480-947-1911) for a no-charge, five-minute phone consultation
Be prepared for a more demanding ROC license application.
The ROC has
greatly expanded the information required in its license application and its
application to substitute a qualifying party. For example, every
individual "named" on the license, including every owner and officer of a
corporate licensee, must provide verified copies of their driver’s license.
Applicants should also be anticipate criminal background checks.
In addition, the ROC has increased its
scrutiny of applicant and qualifying party experience. With respect to substitution of qualifying parties, failure to do so within the
allowed time will result in immediate suspension of the license; therefore,
begin the application process as soon as possible.
applications and instructions can be found at
the ROC's website.
Don’t let a non-employee work under your license.
No matter how clever you are, you cannot find a way to "share" your license with
an unlicensed contractor in such a way that you can escape the ROC’s scrutiny. "Aiding and
abetting" unlicensed persons to contract without a license can result in
revocation of a license under
A.R.S. § 32-1157.
Make sure your
contracts meet statutory requirements.
Every Arizona contract between a contractor and a
property owner for services of $1,000 or more must be written and must contain
certain information, as set forth in
A.R.S. § 32-1158(B). (Additional requirements
apply to contracts for
residential swimming pool construction and,
under certain circumstances,
The name of
the contractor and the contractor's business address and license number.
The name and
mailing address of the owner and the jobsite address or legal description.
The date the
parties entered into the contract.
estimated date of completion of all work to be performed under the contract.
description of the work to be performed under the contract.
dollar amount to be paid to the contractor by the owner for all work to be
performed under the contract, including all applicable taxes.
amount of any advance deposit paid or scheduled to be paid to the contractor by
amount of any progress payment and the stage of construction at which the
contractor will be entitled to collect progress payments during the course of
construction under the contract.
the property owner has the right to file a written complaint with the registrar
for an alleged violation of section 32-1154, subsection A. The contract shall
contain the registrar's telephone number and website address and shall state
that complaints must be made within the applicable time period as set forth in
section 32-1155, subsection A. The information in this paragraph must be
prominently displayed in the contract in at least ten point bold type, and the
contract shall be signed by the property owner and the contractor or the
contractor's designated representative. This paragraph does not apply to a
person who is subject to and complies with section 12-1365.
For more on
this topic, see our March 2012 article, "Negotiating
a Construction Contract: Tips and Reminders."
Also, contractors need to be aware of the consequences for omitting any of the
required contract elements listed above; see "ROC
Enforcement: Contract Errors Can Trigger Sanctions."
Keep your ROC
contact information up to date.
Advise the ROC
immediately when your address changes, and make sure that someone in your
company is receiving and promptly opening your mail from the ROC. This is not
just a good idea; failure to do this can put you out of business.
complaint is filed against your license, or when a renewal fee is due, the ROC
is required only to mail notice to the address it has on file for you. In the
case of a Citation and Complaint, you have 15 days to file a written answer; if you have
moved without advising the ROC or are out of the office for an extended period,
you can easily miss the notice and fail to answer before the deadline.
If you miss the
deadline, you have no recourse; the ROC will not give you a hearing, and you
cannot appeal. In addition, if your license is revoked, it cannot be revived;
you must apply for a new license.
license number on all business stationery.
Anything that has your name on it should also include your license number. The
ROC will not bring a separate complaint for the omission, but it may use the
omission as an aggravating circumstance in disciplinary proceedings that are
brought on other grounds. (See our April 2002 Construction Advisor article, "Tough
Penalties for Failure to Show Arizona License Number.")
The amount of the required ROC bond depends on the annual amount of business you
anticipate. Although the ROC will not bring a separate disciplinary action for
failing to maintain a sufficient bond, it can consider your failure to comply
with bond requirements as an aggravating circumstance in disciplinary proceeding
on other grounds.