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CONSTRUCTION
BULLETIN #1-2006
HOME IMPROVEMENT CONTRACTS:
January 1,
2006 Changes
As of January 1,
2006 all home
improvement
contractors must be
registered with the
Division of Consumer
Affairs, under the
Contractors’
Registration Act.
This statute is in
addition to the New
Jersey Consumer
Fraud Act Home
Improvement
Practices
Regulations and
places additional
requirements on any
person engaging in
the business of home
improvements.
For any home
improvement contract
in excess of
$500.00, failure of
a home improvement
contractor to be
registered and to
maintain the
required $500,000
liability insurance
policy, will be
considered a
violation of the New
Jersey Consumer
Fraud Act and the
contract will be
unenforceable.
The registration
requirements apply
not only to
contractors who
directly contract
with homeowners, but
also subcontractors.
It does not apply to
contractors who are
already registered
as new home builders
or persons already
regulated and
licensed by the
State including
architects,
professional
engineers, landscape
architects, land
surveyors,
electrical
contractors or
master plumbers,
doing business
within their
licensed trade.
In addition to the
registration
requirements, all
home improvement
contracts must
include a specific
notice to the
homeowner providing
them with a three
business day right
to cancel the
contract.
Previously, this
requirement only
existed where the
homeowner was
obtaining financing
through the
contractor.
The existing
provisions of the
Home Improvement
Practices
Regulations under
the New Jersey
Consumer Fraud Act
will substantially
remain in effect.
Those provisions
require that any
such home
improvement
contracts be in
writing and signed,
that any change
orders be in writing
and signed, that the
business address and
telephone number of
the contractor be
stated on the
contract, that the
full name, address
and telephone number
of the sales
representative be
stated on the
contract, that the
contract identify
all pricing and the
start and completion
dates (or a
duration) for the
work among other
things.
Homeowners intending
to enter into a home
improvement contract
can check with the
New Jersey
Department of
Community Affairs to
see if the
particular
contractor is
registered.
Similarly, home
improvement
contractors who wish
to engage a
subcontractor can
check to see if the
subcontractor is
registered.
Violation of the
provisions of the
Contractor
Registration Act can
result in the
unenforceability of
the contract as well
as treble damages
and counsel fee
awards under the New
Jersey Consumer
Fraud Act.
CURETON CAPLAN, P.C.
- James H. Landgraf,
Esq. |
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