§ 20-429 — Required contract provisions. Negative option provisions prohibited. Contract considered home solicitation sale. Contractor-financed contract. Recovery of payment for work performed.

Connecticut § 20-429

• Jurisdiction: Connecticut
• Title 20: Professional and Occupational Licensing, Certification, Title Protection and Registration. Examining Boards
• Ch. 400: Home Improvement Contractors

Text

(a)(1)(A) No home improvement contract shall be valid or enforceable against an owner unless it: (i) Is in writing, (ii) is signed by the owner and the contractor, (iii) contains the entire agreement between the owner and the contractor, (iv) contains the date of the transaction, (v) contains the name and address of the contractor and the contractor's registration number, (vi) contains a notice of the owner's cancellation rights in accordance with the provisions of chapter 740, (vii) contains a starting date and completion date, (viii) is entered into by a registered salesman or registered contractor, and (ix) includes a provision disclosing each corporation, limited liability company, partnership, sole proprietorship or other legal entity, which is or has been a home improvement contractor pursuant to the provisions of this chapter or a new home construction contractor pursuant to the provisions of chapter 399a, in which the owner or owners of the home improvement contractor are or have been a shareholder, member, partner, or owner during the previous five years. (B) Each change in the terms and conditions of a contract shall be in writing and shall be signed by the owner and contractor, except that the commissioner may, by regulation, dispense with the necessity for complying with the requirement that each change in a home improvement contract shall be in writing and signed by the owner and contractor. (2) A contract for repair, remediation or mitigation as set forth in section 38a-313a shall conform to the requirements set forth in subparagraph (A) of subdivision (1) of this subsection and section 38a-313a . (b) No home improvement contract shall be valid if it includes any provision obligating the owner to instruct the home improvement contractor, by a date determined by such contractor, that periodic home improvements are not to be performed unless it also includes a provision requiring the contractor to remind the owner of that obligation by means of a card or letter mailed to the owner and postmarked not earlier than twenty days, and not later than ten days, prior to such date. (c) The contractor shall provide and deliver to the owner, without charge, a completed copy of the home improvement contract at the time such contract is executed. (d) The commissioner may, by regulation, require the inclusion of additional contractual provisions. (e) Each home improvement contract entered into shall be considered a home solicitation sale pursuant to chapter 740 and shall be subject to the requirements of said chapter regardless of the location of the transaction or of the signing of the contract. Each home improvement contract in which the owner agrees to repay the contractor an amount loaned or advanced to the owner by the contractor for the purposes of paying for the goods and services provided in such contract, or which contains a finance charge, (1) shall set forth the information required to be disclosed pursuant to the Truth-in-Lending Act, sections 36a-675 to 36a-685 , inclusive, (2) shall allow the owner to pay off in advance the full amount due and obtain a partial refund of any unearned finance charge, and (3) may contain a finance charge set at a rate of not more than the rate allowed for loans pursuant to section 37-4 . As used in this subsection, “finance charge” means the amount in excess of the cash price for goods and services under the home improvement contract to be paid by the owner for the privilege of paying the contract price in installments over a period of time. (f) Nothing in this section shall preclude a contractor who has complied with subparagraphs (A)(i), (ii), (vi), (vii) and (viii) of subdivision (1) of subsection (a) of this section from the recovery of payment for work performed based on the reasonable value of services which were requested by the owner, provided the court determines that it would be inequitable to deny such recovery. See Sec. 1-2a re construction of references to “United States mail”, “postmark” or “registered or certified mail”.

Legislative History

(P.A. 79-606, S. 12, 14; P.A. 86-94, S. 1; P.A. 88-269, S. 9; 88-364, S. 108, 123; P.A. 91-325, S. 3; P.A. 93-215, S. 1; P.A. 01-155, S. 1; P.A. 06-73, S. 14; P.A. 09-18, S. 2; P.A. 16-35, S. 3; P.A. 17-48, S. 18.) History: P.A. 86-94 inserted new Subsec. (b) providing that no home improvement contract shall be valid if it includes a provision obligating the owner to instruct the contractor by a certain date that work is not to be performed, relettering former Subsecs. as necessary; P.A. 88-269 expanded Subsec. (a) to include eight required provisions and added Subsec. (e) providing that the contracts are to be considered home solicitation sales; P.A. 88-364 corrected an incorrect reference to the statutory location of the cancellation rights in P.A. 88-269; P.A. 91-325 amended Subsec. (a) by authorizing commissioner to dispense with the necessity for complying with the requirement that each change in a home improvement contract be in writing and signed by the owner and contractor; P.A. 93-215 added Subsec. (f) re contractor's right to recover payment for work performed; P.A. 01-155 amended Subsec. (e) by adding provisions re contracts financed by loan or advance from the contractor; P.A. 06-73 amended Subsec. (a)(5) to require contract to contain the contractor's registration number, effective May 30, 2006; P.A. 09-18 amended Subsec. (a) by adding Subdiv. (9) re legal entity disclosure, effective July 1, 2009; P.A. 16-35 amended Subsec. (a) by designating existing provisions re valid or enforceable contract as Subdiv. (1)(A), redesignating existing Subdivs. (1) to (9) as clauses (i) to (ix), designating existing provisions re change in terms and conditions of contract as Subdiv. (1)(B) and adding Subdiv. (2) re contract for repair, remediation or mitigation, effective January 1, 2017; P.A. 17-48 amended Subsec. (f) to replace reference to Subdivs. (1), (2), (6), (7) and (8) with reference to Subdiv. (1)(A)(i), (ii), (vi), (vii) and (viii). Is not construed to apply doctrine of full performance. 200 C. 713. Cited. 209 C. 185; 215 C. 316; Id., 336; Id., 345. Absent proof of bad faith on part of homeowner, statute does not permit recovery in quasi-contract by contractor who fails to comply with requirement for written contract. Id., 350. Cited. 224 C. 231; Id., 240; 232 C. 666; 237 C. 123. Bad faith exception to the bar on a contractor's recovery under contracts that do not comply with section does not apply when a homeowner receives goods and services from a contractor in the belief that they ultimately will have to be paid for, but then repudiates the contract because the contractor's noncompliance with section gave rise to a genuine, good faith dispute about the scope of work or contract price. 325 C. 14. Cited. 18 CA 581; 20 CA 625; 24 CA 223; 27 CA 162; 33 CA 294; 35 CA 253; 38 CA 420; 40 CA 351; 43 CA 184. Requirement that a consumer is fully notified and understands his or her right to cancel a contract is central to Home Improvement Act; home improvement contract violated requirements of the act because contract and cancellation form did not have a transaction date. 72 CA 53. Neither the fact that plaintiff was represented by counsel throughout the process nor plaintiff's failure to raise noncompliance with the act until defendant raised a claim of nonpayment constituted bad faith without additional evidence. 122 CA 295. Under the bad faith exception, contractor is entitled to recover the value of the work performed but not additional damages provided for in the contract, such as attorney's fees, when the contract is otherwise unenforceable due to contractor's violation of section. 126 CA 94. Subsec. (a): Bad faith exception to enforcement of provisions discussed. 224 C. 231. Provisions of statute mandatory but strict compliance not required and contract valid even though 2 copies of cancellation notice not attached to contract and cancellation date not noted. 247 C. 218. Court rejected plaintiffs' argument that, because language of Subsec. mandates that all changes to a home improvement contract must be signed by both owner and contractor in order to be valid and enforceable, arbitration award based on 5 change orders that were not signed by owner were a manifest disregard of the law. 279 C. 300. Subsec. was not intended to supersede established principles of contract damages and allow a homeowner affirmatively to recover damages to which he would not otherwise be entitled; in an action brought by a homeowner against a home improvement contractor for breach of contract, Subsec. does not preclude the damages award from being reduced by an amount equal to the unpaid balance remaining on the contract. 290 C. 1. Cited. 18 CA 463; 31 CA 682; Id., 294; 45 CA 586. Because the contract in this case consists of 2 separate documents, the documents read together constitute a contract that satisfies section's requirements. 69 CA 136. Homeowner not responsible for contractor's failure to comply with the act, including contractor's failure to have homeowner sign contract before proceeding with work, failure to give homeowner notice of cancellation rights before beginning work, failure to include contractor's address, and failure to document changes from original plan in writing; the fact that contract was not signed by either party was not evidence that plaintiff waived compliance with the act or that plaintiff acted in bad faith. 121 CA 105. Failure of homeowner's contract with general contractor to comply with requirements of Subsec. does not bar subcontractor's right to recover against homeowner under mechanic's lien statute. 136 CA 184. Complete absence of a written contract that complies with Home Improvement Act, or at the very least a written and signed memorialization of changes in the terms and conditions of the original contract, as required by Subsec., cannot be deemed “minor and highly technical” deviation from the act. 48 CS 248. Subsec. (f): Damages may be awarded under theory of unjust enrichment even if all requirements of Home Improvement Act, revised to 2003, are not met. 307 C. 582. If court determines that requirements of Subsec. are met, it may award damages under a theory of unjust enrichment even if all requirements of Home Improvement Act are not met. 103 CA 566.