Reporting unlicensed contractors

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jeff48356

Senior Member
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Livonia, Michigan
I'm indirectly involved in some unlicensed contractor activity, and I was wondering if there's anything I could do about this. Here's the deal: I'm a licensed electrical contractor who has been hired (directly by the homeowner) to rewire an old house in the city of Knoxville that had been gutted by a building "contractor" who lied to my customer (the same homeowner) about being licensed. He is in fact unlicensed, and has already done about $15,000 worth of work without a permit that he's unable to pull. But the homeowner paid much more than that, since they never had a written contract.

Now he's busted his budget, so is unable to have me do my job, since he doesn't have money to pay for it. The entire project is on hold now until something gets resolved.

I am really tired of seeing unlicensed contractor activity, and the resulting financial damage to unsuspecting homeowners. I know the states of Florida, California, Arizona, and Texas have been known to crack down on this, and even do undercover sting operations. I wish they'd do them in Tennessee, too.
 
It depends on the laws in Tenn. Around here you do not need a building license if the job is under something like $40,000- not sure of the exact amount. So before you cause issues check with the building depart. Gus may know the answer to this
 
jeff48356 said:
I'm indirectly involved in some unlicensed contractor activity, and I was wondering if there's anything I could do about this. Here's the deal: I'm a licensed electrical contractor who has been hired (directly by the homeowner) to rewire an old house in the city of Knoxville that had been gutted by a building "contractor" who lied to my customer (the same homeowner) about being licensed. He is in fact unlicensed, and has already done about $15,000 worth of work without a permit that he's unable to pull. But the homeowner paid much more than that, since they never had a written contract.
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If the homeowner hired you directly to rewire a house then he is acting as the general contractor on this job. The homeowner can probably get a building permit for the job.

You don't need to report anyone, all you need to do is just try to get an electrical permit on a job like this without there being a building permit. They should let you know real fast that a building permit is needed and they will probably investigate why there isn't one.
 
jeff48356 said:
I'm indirectly involved in some unlicensed contractor activity, and I was wondering if there's anything I could do about this. Here's the deal: I'm a licensed electrical contractor who has been hired (directly by the homeowner) to rewire an old house in the city of Knoxville that had been gutted by a building "contractor" who lied to my customer (the same homeowner) about being licensed. He is in fact unlicensed, and has already done about $15,000 worth of work without a permit that he's unable to pull. But the homeowner paid much more than that, since they never had a written contract.

Now he's busted his budget, so is unable to have me do my job, since he doesn't have money to pay for it. The entire project is on hold now until something gets resolved.

I am really tired of seeing unlicensed contractor activity, and the resulting financial damage to unsuspecting homeowners. I know the states of Florida, California, Arizona, and Texas have been known to crack down on this, and even do undercover sting operations. I wish they'd do them in Tennessee, too.
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Let me get this straight. The HO hired you after the unlicensed person gutted the place and paid him. Then he hired you. Wouldn't that mean the HO hired you with an already busted budget? If so, why would the HO hire you if they knew they couldn't pay you?
 
Did you take the job knowing in advance the contractor was unlicensed?

Did you take the job knowing the HO was unable to pay you?

Did you take the job knowing the contractor had been kicked to the curb?
 
Have you already done any work under your contract that you need paid for? Yes, that should include planning and gearing-up.

Is the big issue that you have a contract to do work, but the HO is trying to get out of it because they ran out of money?

Other than your gearing-up, it sounds like the HO is the one who's really hurting and it should be his call to report the other guy. Maybe he has a reason he used him and hasn't reported him.
 
MAC702 said:
Other than your gearing-up, it sounds like the HO is the one who's really hurting and it should be his call to report the other guy. Maybe he has a reason he used him and hasn't reported him.
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Why would you even gear-up for a job like this?

If I get a call about a total rewire on a gutted house/total remodel today one of the first things I'm going to ask is if they have a building permit. If they say they do then when I get to the job to look things over I'm going to want to see the permit and get the permit number. I then look at the meter to see which POCO that is supplying power. I will need all this information just to fill out a permit application.

Before I do anything I want to know where,when and how I'm to be paid ( a contract) and I need to know if I can obtain a permit. If I don't get these then there is no reason to do anything more. I'm not involved in any way, I just looked at a job.
 
growler said:
Why would you even gear-up for a job like this?
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Once you have a contract, anything you do to prepare for the job should be part of the paid "work." If you already have everything you need for the job already on the truck without even having to THINK about it, but just show up and get 'er done; great. To me, gearing up doesn't necessarily mean spending money on materials and tools. It is mostly time, including sitting down and thinking about what you want to do.

The OP says he's already been hired.
 
MAC702 said:
The OP says he's already been hired.
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He says that he has been hired by the homeowner.
If the homeowner is hiring the trades then it's the homeowner that needs a building permit because he is acting as the GC.

It's important to establish just who is running a job and who will be responsible right from the start of things.

I have done several jobs where a homeowner would hire unlicensed contractors ( not even citizens) to gut out a house and do frameing but that's not my concern.
 
jeff48356 said:
I'm a licensed electrical contractor who has been hired (directly by the homeowner) to rewire an old house in the city of Knoxville that had been gutted by a building "contractor" who lied to my customer (the same homeowner) about being licensed. He is in fact unlicensed, and has already done about $15,000 worth of work without a permit that he's unable to pull. But the homeowner paid much more than that, since they never had a written contract.

Now he's busted his budget, so is unable to have me do my job, since he doesn't have money to pay for it. The entire project is on hold now until something gets resolved.
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K8MHZ said:
Let me get this straight. The HO hired you after the unlicensed person gutted the place and paid him. Then he hired you. Wouldn't that mean the HO hired you with an already busted budget? If so, why would the HO hire you if they knew they couldn't pay you?
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None of this sounds right. Either the homeowner is an idiot or a crook and it's doesn't matter much from the stand point as an EC. It means the jobs a mess and it better to stay away from those.
 
Might this be a possibility? I've been told by inspector here years ago that you don't need to pull a permit to do demo work, is this all that the contractor did or did he start installation of new construction?
 
growler said:
None of this sounds right. Either the homeowner is an idiot or a crook and it's doesn't matter much from the stand point as an EC. It means the jobs a mess and it better to stay away from those.
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Agreed.

Roger
 
jeff48356 said:
Here's the deal: I'm a licensed electrical contractor who has been hired (directly by the homeowner) to rewire an old house in the city of Knoxville that had been gutted by a building "contractor" who lied to my customer (the same homeowner) about being licensed. He is in fact unlicensed, and has already done about $15,000 worth of work without a permit that he's unable to pull. But the homeowner paid much more than that, since they never had a written contract.
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Coppersmith said:
Every time you report an unlicensed contractor an angel gets it's wings.
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How are you going to report someone like this? If they are still working on the job you can report unpermitted work going on and let the authorities investigate. With no paperwork they will just write up a citation to the homeowner and shut the job down.

If you have a contract where this guy has claimed to be a contractor, a business card where he claimed to be a contractor or an add where he claimed to be a contractor then you can take that to the authorities and they will take action.

The way things are the homeowner has a problem with these people and it's up to the home owner to settle it. Who knows he may be able to bring fraud charges against them if they ripped him off but there isn't much an EC can do.

I would advise the homeowner to take legal action if he has a problem with a contractor but I wouldn't get involved. I would look for another job where they do have money to pay.
 
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