Business and Professions Code 7028 BP is the California statute that makes it a crime to engage in contracting without a licenbse. Under this statute, it is a crime for a contractor to do business without a current and valid contractor's license.
Examples of criminal acts under BP 7028 include:
- Carlos enters into an agreement, worth $4,000, to build his neighbor's garage, despite the fact that he has no contractor's license.
- John operates Johnny Builders, LLC and enters into several contracts for the construction of new homes, even though his contractor's license is suspended.
- Without a contractor's license, Beth creates Pools-R-Us and enters into a substantial contract to repair her town's public pool.
Luckily, there are several legal defenses that a person can raise if accused of a crime under BP 7028. These include showing that an accused party was:
- not a “contractor,”
- working on a “small operation,' and/or
- an employee.
As a misdemeanor, the crime is punishable by:
- Imprisonment in a county jail for up to six months (and longer if multiple convictions); and/or,
- A fine of up to $1,000 (and more if multiple convictions).
A person could also face disciplinary proceedings from the Contractors State License Board of California.
Our California criminal defense attorneys will highlight the following in this article:
- 1.The Legal Definition of Contracting without a License
- 2. Legal Defenses to BP 7028 Violations
- 3. Penalties, Punishment, and Sentencing
- 4. Related Offenses
1. The Legal Definition of Contracting without a License
California Business and Professions Code 7028 BP makes it a crime to do either of the following:
- Serve as a contractor without a license from the Contractors State License Board; and,
- Operate as a contractor under a license that is suspended for failure to pay a civil penalty, or, to comply with an order of correction.1
California law states that a “contractor” means the same thing as “builder.” And, the term includes any person that does himself, or through others,
- Adds to or subtracts from,
- Wrecks, or
any building, excavation, or other project, structure, development, or improvement.2
Please note that under Business and Professions Code 7028, a contract entered into by an unlicensed contractor is illegal.3
Further, failure to obtain a contractor's license will bar a contractor from recovering any money that may be due (for work performed under a contract).4
2. Legal Defenses
A person accused under BP 7028 can challenge the accusation by raising a legal defense. A good defense can often get a charge reduced or even dismissed. Please note, though, that it is critical for an accused to hire an attorney to get the most effective defense.
Three common defenses to BP 7028 accusations are:
- Not a contractor;
- Small work exemption; and/or,
- An employee.
2.1. Not a Contractor
Please note that Business and Professions Code 7028 only applies to “contractors.” Further, this term carries a very specific definition under Business and Professions Code 7026. Thus, a solid legal defense is for a party to show that he was not technically a “contractor” while performing any work in question.
2.2. Small Work Exemption
California Business and Professions Code 7048 BP provides an exception to the laws within BP 7028. The exception is commonly known as the “small operations exemption.” It states that BP 7028 does not apply to any work being performed under a contract for less than $500.5 It also does not apply to operations that are considered “casual, minor, or inconsequential…”.6 A person, therefore, could perform such work even without a contractor's license.
2.3. An Employee
BP 7028 does not apply to a person that does contracting work as an employee, while earning wages from a contracting company. Here, the contracting company is subject to Business and Professions Code 7028, not the employee.
3. Penalties, Punishment, and Sentencing
Under BPC 7028, contracting without a license is a misdemeanor offense.7
A first conviction for the offense is punishable by:
- Imprisonment in the county jail for up to six months; and/or,
- A fine of up to $5,000.8
Repeat offenders are subject to greater fines and longer prison terms.9
In lieu of imprisonment, a judge has the discretion to impose misdemeanor probation, or “summary” or “informal” probation.
4. Related Offenses
There are three crimes related to contracting without a license. These are:
- Unauthorized practice of law – BP 6125;
- Unauthorized practice of medicine – BP 2052; and,
- False advertising – BP 17500.
4.1. Unauthorized Practice of Law – BP 6125
Under BP 6125, a person can only practice law in California if he is an active member of the California State Bar.10
A non-lawyer who presents himself as an attorney, or practices law, faces California misdemeanor penalties. These may include:
- A fine of up to $1,000; and/or,
- Imprisonment in the county jail for up to one year.11
These penalties are even steeper for former attorneys who have been:
- Involuntarily shifted to “inactive” membership in the State Bar,
- Suspended from membership in the State Bar,
- Disbarred, or
- Resigned from the State Bar with criminal charges pending.12
In these cases, the unauthorized practice of law is a wobbler offense, meaning it can be charged as a misdemeanor or a felony. The potential felony jail sentence can go as high as three years.13
4.2. Unauthorized Practice of Medicine – BP 2052
Specifically, BP 2052 prohibits the following activities if they are undertaken without a valid professional medical license:
- Practicing, attempting to practice, or advertising oneself as practicing any system of treating illness or affliction;
- Diagnosing, treating, operating on, or prescribing for any physical or mental condition; and
- Engaging in a conspiracy to—or aiding and abetting someone else to—do any of those things.14
The unauthorized practice of medicine in California is a wobbler offense. This means it may be charged as either a misdemeanor or a felony.
The potential misdemeanor penalties are:
- Imprisonment for up to one year in county jail; and/or,
- A fine of up to $1,000.15
The potential felony penalties are:
- Imprisonment for 16 months, two years, or three years in county jail; and/or,
- A fine of up to ten thousand dollars ($10,000).16
4.3. False Advertising – BP 17500
Under BP 17500, false or deceptive advertising is when a person or company makes false or misleading statements to consumers about the nature of a product or service.17
A person or company that violates BP 17500 is guilty of a misdemeanor. The offense is punishable by:
- Imprisonment in the county jail for up to six months; and/or,
- A fine not to exceed $2,500.18
A person or company guilty of false advertisement may also face a civil lawsuit and/or an injunction.
4.4. Fraudulent Use of a Contractor's License Number - BP 7027.3
Business & Professions Code 7027.3 is the California law re fraudulent use of a contractor's license number. Examples would include using another person's license number, or using a number that is fictitious altogether. This offense is a wobbler that can be charged as a misdemeanor or a felony, and can carry penalties of up to 3 years in custody.
Were you accused of contracting without a license in California? Call us for help…
If you or someone you know has been accused of a crime, per Business and Professions Code 7028, we invite you to contact us for a free consultation. We can be reached 24/7 at 855-LAWFIRM. (For similar accusations or charges in Nevada or Colorado, please see our page on Nevada Law re "Unlicensed Contractors" (NRS 624.700) and Colorado laws re contracting without a license).
California Business and Professions Code 7028(a)(1) and (a)(2) BP. Subsection (a) of BP 7028 states:
Unless exempted from this chapter, it is a misdemeanor for a person to engage in the business of, or act in the capacity of, a contractor within this state under either of the following conditions:
(1) The person is not licensed in accordance with this chapter.
(2) The person performs acts covered by this chapter under a license that is under suspension for failure to pay a civil penalty or to comply with an order of correction, pursuant to Section 7090.1, or for failure to resolve all outstanding final liabilities, pursuant to Section 7145.5.
California Business and Professions Code 7026 BP.
S & Q Constr. Co. v. Palma Ceia Development Organization (1960), 179 Cal. App. 2d 364.
Business and Professions Code 7048 BP.
California Business and Professions Code 7028(a) BP.
California Business and Professions Code 7028(b) BP.
California Business and Professions Code 7028(c) and (d) BP.
California Business & Professions Code 6125 BP.
California Business and Professions Code 6126 BP.
Business and Professions Code 2052 BP.
California Business and Professions Code 17500 BP.