New Jersey Home Improvement Contractors face a compliance landmine that can cost them dearly if left ignored. This landmine is tied to those regulations protecting consumers from unscrupulous contractors and the significant repercussions when these regulations are ignored.
Pursuant to the New Jersey Contractor’s Registration Act of two decades ago, “every home improvement contract for a purchase price in excess of $500, and all changes in the terms and conditions of the contract, shall be in writing.” N.J.S.A. 56:8-151(a). Under the applicable regulatory provisions: “Home improvement contracts which are required by this subsection to be in writing, and all changes in the terms and conditions thereof, shall be signed by all parties thereto, and shall clearly and accurately set forth in legible form and in understandable language all terms and conditions of the contract, including, but not limited to, the dates or time period on or within which the work is to begin and be completed by the seller.” N.J.A.C. 13:45A-16.2(a), et seq.
As well, a contractor’s license number should be on all business documents, including their contracts. See N.J.S.A. 56:8-144(a). The NJ Department of Consumer Affairs toll free number regarding consumer rights involving home improvement contractors must also be on contracts and invoices. See N.J.S.A. 56:8-144(b); N.J.S.A. 56:8-149. A copy of the contractor’s certificate of insurance should also be attached to this contract. See N.J.S.A. 56:8-142. Each contract must also contain a conspicuous notice mandated by the Contractor Registration Act that provides for cancellation of the contract for any reason before midnight of the third business day after the consumer receives a copy of the contract. See N.J.S.A. 56:8-151.
Contracts that are not signed, contain no start and end dates, contain no contractor license number, fail to provide the DCA hotline number, fail to include the contractor’s certificate of insurance, and fail to provide consumer notice of the three-day cooling off period, are deemed regulatory failures that can give rise to significant fines and potential jail time if willfully made.
More specifically, any contractor who fails to register as required by the Contractors’ Registration Act but who continues to sell or make home improvements or who violates any other section of the law may be found guilty of a crime of the fourth degree and face possible jail time. N.J.S.A. 56:8-146. Indeed, persons can be subject to civil monetary penalties of up to $15,000 for the first offense and up to $25,000 for each subsequent offense if they engage in any of the activities regulated by this act in New Jersey even if their residence or principal place of business is located outside of New Jersey. N.J.S.A. 56:8-146.1.
Licenz provides home improvement contractors with a full suite of services – including a customized contract and regulatory compliance assistance, at a low flat rate so that home improvement contractors doing business in New Jersey satisfy these important requirements under the Contractors’ Registration Act and other regulations.
