Opinion
NOT TO BE PUBLISHED
APPEAL from a judgment of the Superior Court of Los Angeles County No. PC040283, John P. Farrell, Judge.
Law Offices of Robert J. Rice and Robert J. Rice for Plaintiff and Appellant.
Kane Law Firm, Brad S. Kane; Backus, Bland, Navarro & Weber and David Ernst for Defendant and Respondent.
JACKSON, J.
INTRODUCTION
In this action involving the Contractors’ State License Law (Bus. & Prof. Code, § 7000 et seq.), plaintiff and cross-defendant Martin Stowell, doing business as Landco (Stowell), appeals from the judgment entered in favor of defendant and cross-complainant Brett Markson (Markson). We affirm.
All further statutory references are to the Business and Professions Code unless otherwise noted.
FACTS
At all times relevant to this action, Stowell was a duly licensed specialty contractor, holding a Class C-27 license—i.e., a landscape contractor’s license. In January 2006, Stowell entered into a written contract with Markson for outdoor improvements at Markson’s home in Santa Clarita. The total contract price for all improvements was $175,000.
The improvements consisted of front yard, side yard and backyard hardscapes, as well as landscaping, irrigation and drains. The contract also called for the construction of a balcony, patio and arbor, which Stowell subcontracted to Larkins Construction Company (Larkins). The parties’ contract specifically references Larkins’s proposal, which is attached to the contract. In its proposal, Larkins listed Stowell’s dba as the customer and listed the job site as Markson’s home. The proposal listed the job as the construction of a 420-square-foot balcony, a 420-square-foot patio and a 4-foot by 16-foot arbor, among other things, at a price of $40,246. Stowell invoiced Markson for all the work done pursuant to the parties’ contract, and Markson paid with checks made payable to Stowell or Stowell’s company, Landco.
Eventually, a dispute arose between the parties over, among other things, the final amount owing, leading to the filing of this action.
PROCEDURAL BACKGROUND
On February 28, 2007, Stowell sued Markson to recover $53,990, the balance Stowell claimed was due on the contract. Attached to Stowell’s complaint was the parties’ contract, including Larkins’s proposal. On April 17, 2007, Stowell recorded a mechanic’s lien against Markson’s residence.
Stowell subsequently filed an amended complaint, which was followed by the operative second amended complaint. In the operative complaint, Stowell alleged causes of action for money due on contract, open book account, reasonable value of labor and materials furnished, fraud and foreclosure of mechanic’s lien. Thereafter, on October 15, 2007, the trial court sustained without leave to amend Markson’s demurrer to Stowell’s fourth cause of action for fraud.
In November 2007, Markson filed a verified cross-complaint containing six causes of action: Contractors’ State License Law violations (§ 7031), home improvement contract violations (§ 7159), Unlawful Business Practices Act violations (§ 17200 et seq.), Consumers Legal Remedies Act violations (Civ. Code, § 1750 et seq.), unjust enrichment and declaratory relief. Pursuant to section 7031, subdivision (b), Markson sought reimbursement from Stowell for all the money he paid him under the contract.
Markson subsequently moved for judgment on the pleadings as to Stowell’s remaining four causes of action. The trial court granted the motion, concluding that the allegations of Stowell’s collective pleadings (original complaint, amended complaint, second amended complaint) and his mechanic’s lien barred his claims as a matter of law. More specifically, the court concluded that section 7031, subdivision (a), barred Stowell’s claims, in that Stowell contracted to perform work beyond the scope of his C-27 landscape license.
On August 21, 2006, before trial commenced, Markson voluntarily dismissed the second through sixth causes of action of his cross-complaint. All that remained was his first cause of action for reimbursement of all compensation paid pursuant to section 7031, subdivision (b). In light of judicial admissions made by Stowell in his pleadings and his mechanic’s lien, the court concluded that the only factual issue to be decided by the jury was the actual amount Markson had paid to Stowell for work done pursuant to their contract.
After all evidence had been presented to the jury, Markson moved for a directed verdict on the ground that the evidence established unequivocally that he paid Stowell $128,550. The court agreed, granted the motion and directed the jury to render its verdict for Markson in the amount of $128,550. The jury did as directed.
Thereafter, the trial court entered judgment against Stowell and in favor of Markson on Stowell’s complaint, and in favor of Markson on the first cause of action of his cross-complaint in the amount of $128,550, together with pre-judgment and post-judgment interests and costs. The court also ordered Stowell’s mechanic’s lien to be expunged and unconditionally released.
This appeal followed.
DISCUSSION
Contractors’ State License Law
The Contractors’ State License Law is designed to protect the public. (MW Erectors, Inc. v. Niederhauser Ornamental & Metal Works Co., Inc. (2005) 36 Cal.4th 412, 418.) It “imposes strict and harsh penalties for a contractor’s failure to maintain proper licensure.” (Ibid.) Generally, “regardless of the merits of the claim, a contractor may not maintain any action, legal or equitable, to recover compensation for ‘the performance of any act or contract’ unless he or she was duly licensed ‘at all times during the performance of that act or contract.’” (Ibid., quoting § 7031, subd. (a).) “Where applicable, section 7031[, subdivision ](a) bars a person from suing to recover compensation for any work he or she did under an agreement for services requiring a contractor’s license unless proper licensure was in place at all times during such contractual performance.” (MW Erectors, Inc., supra, at p. 419.)
Section 7031, subdivision (a), in pertinent part provides that “no person engaged in the business or acting in the capacity of a contractor, may bring or maintain any action, or recover in law or equity in any action, in any court of this state for the collection of compensation for the performance of any act or contract where a license is required by this chapter without alleging that he or she was a duly licensed contractor at all times during the performance of that act or contract, regardless of the merits of the cause of action brought by the person....”
Subdivision (b) of section 7031 provides additional protection to those who enter into agreements with contractors who are not properly licensed. Specifically, it authorizes “a person who utilizes the services of an unlicensed contractor [to] bring an action in any court of competent jurisdiction in this state to recover all compensation paid to the unlicensed contractor for performance of any act or contract.” Together, subdivisions (a) and (b) of section 7031 function as “a stiff all-or-nothing penalty.” (MW Erectors, Inc. v. Niederhauser Ornamental & Metal Works Co., Inc., supra, 36 Cal.4th at p. 426; Goldstein v. Barak Construction (2008) 164 Cal.App.4th 845, 856.)
Motion for Judgment on the Pleadings
As observed in Buesa v. City of Los Angeles (2009) 177 Cal.App.4th 1537, “‘[t]he standard of review for a motion for judgment on the pleadings is the same as that for a general demurrer: We treat the pleadings as admitting all of the material facts properly pleaded, but not any contentions, deductions or conclusions of fact or law contained therein. We may also consider matters subject to judicial notice. We review the complaint de novo to determine whether it alleges facts sufficient to state a cause of action under any theory. [Citation.]’ [Citation.]” (Id. at p. 1543.)
Exhibits attached to the complaint may be considered. If the facts in the exhibits contradict the facts alleged in the complaint, the facts in the exhibits take precedence. (Gilman v. Dalby (2009) 176 Cal.App.4th 606, 613, citing Mead v. Sanwa Bank California (1998) 61 Cal.App.4th 561, 567-568.)
“An amended complaint may be rendered defective by proof of attempted suppression in it of destructive matter set forth in a superseded pleading. Where the amended pleading attempts to avoid defects revealed in that prior pleading by ignoring those defects, the court may examine the prior complaint or complaints to ascertain whether the amended pleading is merely a sham.” (Kiseskey v. Carpenters’ Trust for So. California (1983) 144 Cal.App.3d 222, 228-229.)
In granting Markson’s motion for judgment on the pleadings, the trial court adjudicated the licensing issue based on the undisputed terms of the parties’ contract and Stowell’s status as a licensed landscape contractor. (See Hydrotech Systems, Ltd. v. Oasis Waterpark (1991) 52 Cal.3d 988, 993; Banis Restaurant Design, Inc. v. Serrano (2005) 134 Cal.App.4th 1035, 1038.) Although, in the operative complaint, Stowell alleged in general terms that he was a licensed contractor within the State of California at all relevant times, this somewhat vague allegation could not erase the effect of the specific allegation in his original complaint that he was licensed as a landscape contractor. (Gilman v. Dalby, supra, 176 Cal.App.4th at p. 613.) Having alleged only that he was a landscape contractor, and in light of the undisputed contract terms and the allegation that Stowell performed all of its obligations under the contract, the trial court properly proceeded to adjudicate the licensing issue.
While there is no question that Stowell was duly licensed to perform much of the work for which he contracted, the sticking point is the balcony. We agree with the trial court that in constructing a balcony, Stowell performed work beyond the scope of his C-27 landscape contractor’s license.
There are three branches of contracting business: general engineering contracting, general building contracting and specialty contracting. (§ 7055.) A landscape contractor, such as Stowell, is a specialty contractor, “a contractor whose operations involve the performance of construction work requiring special skill and whose principal contracting business involves the use of specialized building trades or crafts.” (§ 7058, subd. (a).)
Subdivision (a) of section 7059 states, “The board may adopt reasonably necessary rules and regulations to effect the classification of contractors in a manner consistent with established usage and procedure as found in the construction business, and may limit the field and scope of the operations of a licensed contractor to those in which he or she is classified and qualified to engage, as defined by Sections 7055, 7056, 7057, and 7058. A licensee may make application for classification and be classified in more than one classification if the licensee meets the qualifications prescribed by the board for such additional classification or classifications.... [¶] Nothing contained in this section shall prohibit a specialty contractor from taking and executing a contract involving the use of two or more crafts or trades, if the performance of the work in the crafts or trades, other than in which he or she is licensed, is incidental and supplemental to the performance of the work in the craft for which the specialty contractor is licensed.”
California Code of Regulations, title 16, section 830 is entitled “Classification Policy.” It provides: “(a) All contractors to whom licenses are issued shall be classified by the Registrar as a specialty contractor, as defined in this article; a general engineering contractor (Class A), as defined in Section 7056 of the Code; or a general building contractor (Class B), as defined in Section 7057 of the Code. [¶] (b) Contractors licensed in one classification shall be prohibited from contracting in the field of any other classification unless they are also licensed in that classification or are permitted to do so by Section 831.”
California Code of Regulations, title 16, section 831 defines incidental and supplemental. It provides “For purposes of Section 7059, work in other classifications is ‘incidental and supplemental’ to the work for which a specialty contractor is licensed if that work is essential to accomplish the work in which the contractor is classified. A specialty contractor may use subcontractors to complete the incidental and supplemental work, or he may use his own employees to do so.”
California Code of Regulations, title 16, section 832.27, entitled “Class C-27—Landscaping Contractor” provides: “A landscape contractor constructs, maintains, repairs, installs, or subcontracts the development of landscape systems and facilities for public and private gardens and other areas which are designed to aesthetically, architecturally, horticulturally, or functionally improve the grounds within or surrounding a structure or a tract or plot of land. In connection therewith, a landscape contractor prepares and grades plots and areas of land for the installation of any architectural, horticultural and decorative treatment or arrangement.”
Section 7027.5 provides additional insight to the scope of work performed by a landscape contractor. It provides: “(a) A landscape contractor working within the classification for which the license is issued may design systems or facilities for work to be performed and supervised by that contractor.
“(b) Notwithstanding any other provision of this chapter, a landscape contractor working within the classification for which the license is issued may enter into a prime contract for the construction of any of the following:
“(1) A swimming pool, spa, or hot tub, provided that the improvements are included within the landscape project that the landscape contractor is supervising and the construction of any swimming pool, spa, or hot tub is subcontracted to a single licensed contractor holding a Swimming Pool (C-53) classification, as set forth in Section 832.53 of Title 16 of the California Code of Regulations, or performed by the landscape contractor if the landscape contractor also holds a Swimming Pool (C-53) classification. The contractor constructing the swimming pool, spa, or hot tub may subcontract with other appropriately licensed contractors for the completion of individual components of the construction.
“(2) An outdoor cooking center, provided that the improvements are included within a residential landscape project that the contractor is supervising. For purposes of this subdivision, ‘outdoor cooking center’ means an unenclosed area within a landscape that is used for the cooking or preparation of food or beverages.
“(3) An outdoor fireplace, provided that it is included within a residential landscape project that the contractor is supervising and is not attached to a dwelling.
“(c) Work performed in connection with a residential landscape project specified in paragraph (2) or (3) of subdivision (b) that is outside of the field and scope of activities authorized to be performed under the Landscape Contractor classification (C-27), as set forth in Section 832.27 of Title 16 of the California Code of Regulations, may only be performed by a landscape contractor if the landscape contractor also either holds an appropriate specialty license classification to perform the work or is licensed as a general building contractor. If the landscape contractor neither holds an appropriate specialty license classification to perform the work nor is licensed as a general building contractor, the work shall be performed by a specialty contractor holding the appropriate license classification or by a general building contractor performing work in accordance with the requirements of subdivision (b) of Section 7057.
“(d) A violation of this section shall be cause for disciplinary action.”
At the time the work in this case was performed, section 7027.5 was more limited. It provided only: “(a) A landscape contractor working within the classification for which the license is issued may design systems or facilities for work to be performed and supervised by that contractor. [¶] (b) Notwithstanding any other provision of this chapter, a landscape contractor working within the classification for which the license is issued may enter into a prime contract for the construction of a swimming pool, spa, or hot tub provided the improvements are included within the landscape project that the landscape contractor is supervising and the construction of any swimming pool, spa, or hot tub is subcontracted to a single licensed contractor holding a Swimming Pool (C-53) classification or performed by the landscape contractor if the landscape contractor also holds a Swimming Pool (C-53) classification. The contractor constructing the swimming pool, spa, or hot tub may subcontract with other appropriately licensed contractors for the completion of individual components of the construction.”
Since neither section 832.27 of title 16 of the California Code of Regulations nor section 7027.5 remotely authorizes a landscaper to construct a balcony, and we are unaware of any authority justifying a conclusion that a balcony is incidental or supplemental to the actual landscape Stowell completed (§ 7059), we conclude the trial court properly granted Markson’s motion for judgment on the pleadings with respect to the remaining causes of action in Stowell’s operative complaint.
Motion for Directed Verdict
In Fariba v. Dealer Services Corp. (2009) 178 Cal.App.4th 156 at page 174, the court explained: “‘In ruling upon a defense motion for a directed verdict, the trial court is guided by the same standard used in evaluating a motion for a nonsuit.’ [Citation.] Thus, a directed verdict is properly entered when ‘“the trial court determines that, as a matter of law, the evidence presented by plaintiff is insufficient to permit a jury to find in his favor.”’ [Citation.] ‘“‘In determining whether plaintiff’s evidence is sufficient, the court may not weigh the evidence or consider the credibility of witnesses. Instead, the evidence most favorable to plaintiff must be accepted as true and conflicting evidence must be disregarded.’”’ [Citation.] ‘A directed verdict is... subjected to de novo appellate review’ and ‘“‘is in the nature of a demurrer to the evidence, and is governed by practically the same rules, and concedes as true the evidence on behalf of the adverse party, with all fair and reasonable inferences to be deduced therefrom.’”’ [Citation.])”
By the time this matter reached the trial stage, only the first cause of action of Markson’s cross-complaint remained viable. In that cause of action, Markson sought reimbursement of all compensation paid to Stowell pursuant to section 7031, subdivision (b), which in pertinent part provides: “a person who utilizes the services of an unlicensed contractor may bring an action in any court of competent jurisdiction in this state to recover all compensation paid to the unlicensed contractor for performance of any act or contract.”
Before trial commenced, the trial court limited the issue to be tried by the jury to the amount of compensation Markson paid to Stowell, having already determined as a matter of law based on judicial admissions made by Stowell in his superseded and operative pleadings, as well as his mechanic’s lien, that Stowell was not licensed for the scope of work to be completed. Although Stowell was a duly licensed landscape contractor, his C-27 license was not sufficient to enable him to subcontract out the construction of the balcony. Inasmuch as plaintiff acknowledged that he paid Stowell a total of $128,550, the trial court properly directed the jury to return a verdict for Markson in that amount.
In light of the narrow issues presented on appeal, Stowell’s contentions that he was entitled to present evidence on the scope of work performed and that Markson failed to meet his burden of proving that Stowell was not licensed for the scope of work completed miss the mark. Stowell has failed to demonstrate that the court’s decision to grant a directed verdict for Markson was error.
Equitable Considerations
Stowell seems to suggest that he is entitled to an equitable adjustment or set off for the work performed within the scope of his contractor’s license. In the absence of any citation to legal authority or any legal analysis, we deem this point to be waived. (People v. Stanley (1995) 10 Cal.4th 764, 793.) In any event, “the courts may not resort to equitable considerations in defiance of section 7031.” (Lewis & Queen v. N.M. Ball Sons (1957) 48 Cal.2d 141, 152.) Section 7031 “‘applies despite injustice to the unlicensed contractor.’” (Pacific Custom Pools, Inc. v. Turner Construction Co. (2000) 79 Cal.App.4th 1254, 1261.) Thus, a contractor that contracts outside the scope of his or her license cannot avoid the impact of section 7031 by asking the trial court to divide the licensed work from the unlicensed work (see MW Erectors, Inc. v. Niederhauser Ornamental & Metal Works Co., Inc., supra, 36 Cal.4th at p. 426) or by asking the court to reduce an award of compensation under section 7031, subdivision (b), by offsets for materials and services (White v. Cridlebaugh (2009 178 Cal.App.4th 506, 520-521; Goldstein v. Barak Construction (2008) 164 Cal.App.4th 845, 856.) Section 7031 does not allow for partial recovery. It is an “all-or-nothing” statute. (MW Erectors, Inc., supra, at p. 426.)
DISPOSITION
The judgment is affirmed. Defendant is to recover his costs of appeal.
We concur: PERLUSS, P. J., ZELON, J.