Conti Fenn LLC| Lawyer Touts Nonpayment Defense as Consumer Win

The Daily Record: Lawyer Touts Nonpayment Defense as Consumer Win

Article by By Caryn Tamber, The Daily Record

The lawyer for a Federal Hill couple sued for nonpayment by their contractor is touting a Baltimore judge’s favorable ruling as a victory for consumers on what constitutes “substantial compliance” with contractor-licensing requirements. “This highlights the importance of contracting entities and the persons operating those contracting entities… following the requirements of the Maryland code regarding licensing,” said Paul A. Fenn of Conti, Fenn & Lawrence LLC. The contractors’ lawyer says he will likely file an appeal. “I’m hoping the Court of Special Appeals looks at it and says, you know what, if this isn’t substantial compliance, nothing is,” said Michael B. Green, a Towson solo practitioner. The case began when Green’s clients, Custom Requirements of Maryland Inc., filed for a mechanic’s lien on Clement and Teresa Deltete’s home. Custom Requirements alleged that the Deltetes failed to pay them more than $100,000 for home renovation work. Custom Requirements followed up with a complaint for breach of contract, quantum meruit and unjust enrichment. The Deltetes’ defense was that Custom Requirements was barred from enforcing the contract because at the time, it was not licensed by the Maryland Home Improvement Commission. As Green explains it, Custom Requirements is owned by a former husband and wife. Cynthia Friedel was and is still MHIC-licensed; her now ex-husband, Guillermo Ramirez, has never been licensed. The company did two projects for the Deltetes, and before signing the contract for the second piece of work, Custom Requirements decided to incorporate, going from Custom Requirements of Maryland to Custom Requirements of Maryland Inc. Friedel and Ramirez did not know they had to get an MHIC license for their corporation, Green said. The corporation is now licensed. Ramirez negotiated and sold both home improvement contracts to the Deltetes, which, as an unlicensed party, he was not supposed to do, Fenn said. Green argued that Custom Requirements should be able to enforce its contract because it substantially complied with the licensing requirements. Last Wednesday, after a three-day bench trial, Baltimore City Circuit Court Judge John Carroll Byrnes dismissed Custom Requirements’ cases against the Deltetes. Byrnes considered factors set out in appellate cases on the substantial compliance issue: timing of licensure, responsibility and competence of the contractor, public protection, performance, experience of the contractor, insurance and due diligence of the contractor regarding licensure. “Despite some loosening of the standard, it appears to this Court that there remains a ‘bright line’ in the applicable law — the person or entity doing business with the public in the home improvement arena must be properly licensed in order to allow HIC to meet its responsibility to protect the public from companies that may take undue advantage of a public unsophisticated in either the construction business or the law and regulations,” Byrnes wrote. READ ARTICLE ON SOURCE WEBSITE

July 05 2010 at 3:42 PM