OLR Bill Analysis

sHB 5414

AN ACT CONCERNING DISCLOSURES BY HOME IMPROVEMENT CONTRACTORS AND NEW HOME CONSTRUCTION CONTRACTORS.

SUMMARY:

This bill requires contractors to include a disclosure provision in new home construction contracts and home improvement construction contracts. They must disclose every corporation, limited liability company, partnership, sole proprietorship, or other legal entity that is or has been a home improvement or new home construction contractor in which they were shareholders, members, partners, or owners within the past five years.

EFFECTIVE DATE: July 1, 2009

BACKGROUND

New Home Contractor Disclosure

The law requires new home contractors to register with the Department of Consumer Protection (DCP). Applicants must identify themselves, show that they have liability insurance and any required workers' compensation coverage, and provide the names of the insurers. The law requires a new home contractor to inform customers, before entering into a contract, that they should (1) check with DCP to see if the contractor is properly registered and request his or her complaint history and (2) ask the contractor for a list of customers over the last 24 months to discuss the quality and timeliness of the contractor's work. Contractors must also advise their customers to ask about their customer service policy and if they will hold customers harmless for work performed subcontractors (CGS §§ 20-417a to 20-417j).

Home Improvement Contracts

All home improvement contracts must include certain provisions describing the contractor and the job. Contracts must:

1. be written, dated, and signed by both parties;

2. include the entire agreement;

3. identify the contractor and state his or her address and registration number,

4. include a notice of cancellation rights,

5. include starting and completion dates, and

6. be entered by registered contractors or salesmen. The contractor must give the homeowner a copy. A contractor, in any ensuing litigation, may recover payment for the work actually performed if the contract meets the above criteria (CGS § 20-429).

COMMITTEE ACTION

General Law Committee

Joint Favorable

Yea

18

Nay

0

(03/05/2009)