In order to get a license, contractors in the state of California must post a security deposit with the California Contactors State Licensing Board. One way in which a contractor may do this is by purchasing a surety bond. The surety bond ensures that the contractor will abide by all conditions of the license. In the event the contractor does not comply, a customer and/or employee may file a claim against the bond. Any amount paid out by the surety bond company requires a payback from the contractor. To file a claim against a contractor's surety bond, you will need to take action.
Visit the California Contractors State Licensing Board website (see Resources), and search for the name of your contractor's surety bond company to obtain the company's contact information.
Contact the surety bond company and request information on how to file a claim. Most companies will require you to prepare a written statement covering the dates you contractor provided services and describing how the contractor failed the contract terms. You will need to attach to the written statements all signed contracts, agreements and other paperwork associated with your contractor's contribution to your project.
Mail the written statement and all attached documents to the address specified by the surety bond company. Upon receipt, the surety bond company will review your claims and investigate the allegations. It may take a few months, or, in some cases, even longer for the surety bond company to arrive at a conclusion as to whether it owes you compensation.
File a suit in small claims court if the amount is less than $4,000 and you are not satisfied with the decision of the surety bond company. You should file this suit against both the contractor and the surety bond company. Claims above $5,000, you must file with the superior court in your jurisdiction. In California, procedures vary from county to county regarding filing of court petitions--you should contact an attorney or the court directly for guidance.
- Keep in mind that while the California licensing board may find fault with the contractor and issue disciplinary action or even revoke a license, this does not mean the surety bond company will pay a claim. The surety bond company will use the definition of "clear violation" and often adheres to this definition to protect the company's financial interests.
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