Recently, the California Court of Appeal for the Fourth Appellate District, in Womack v. Lovell, et al., Case No. G409587 (June 5, 2015), reversed a judgment in favor of the homeowner, noting that “[t]he devil isn’t the only resident in the details; sometimes truth and fairness lodge there as well.” The Court of Appeal, holding the homeowner to his judicial admission that the general contractor was licensed, concluded that the homeowner’s judicial admission coupled with his failure to comply with the local rule requiring identification of all controverted issues warranted a ruling in the contractor’s favor. This ruling serves as a reminder to contractors to diligently seek a verified certificate of licensure from the California Contractors State License Board (CSLB) if their licensure may be a controverted issue in a dispute because it may take the CSLB several months to issue the certificate.
Most contractors that work in California are aware that Section 7031(a) of California’s Contractors’ State License Law, Business & Professions Code §§ 7000 et seq., operates to deny access to the courts to contractors who were not licensed at all times during their performance of work requiring a contractor’s license. Many of these contractors may not be aware of Section 7031(d), which requires production of a verified certificate of licensure when the issue of licensure is controverted and can operate to deny even licensed contractors any compensation. The best illustration of how catastrophic it can be to fail to obtain a verified certificate of licensure is set forth in Advantec Group, Inc. v. Edwin’s Plumbing Co., Inc., 153 Cal. App. 4th 621 (2007). In Avantec, the Court of Appeal upheld the developer’s nonsuit motion on the plumber’s cross-complaint based simply upon the absence of a verified certificate of licensure.
In Womack, there was also the absence of a verified certificate of licensure. However, the Court of Appeal concluded that the question of licensure was uncontroverted for purposes of Section 7031 because (1) Womack made a judicial admission in his unverified complaint that the contractor was “validly licensed,” in part, to assure recovery against the contractor’s bond under Section 7071.5; (2) Womack’s general denial to the contractor’s cross-complaint failed to overcome his judicial admission because of the sham pleading doctrine; and (3) Womack failed to comply with the local rule requiring specification of all “controverted issues.” Ultimately, the Court of Appeal concluded that this is one of those relatively rare cases where a party can be bound by a judicial admission made in an unverified complaint.