Written by Jayson Elliott · Attorney, Bay Legal PC · CA Bar No. 332479 · Last reviewed April 2026
BPC §7031
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What BPC §7031 Says
Two powerful protections: (1) an unlicensed contractor cannot bring any action to collect compensation, and (2) a person who uses an unlicensed contractor can recover all compensation paid.
Why This Matters for Permit Violations
Contractors operating without a license frequently also fail to obtain permits. When your contractor was unlicensed and didn't pull permits, §7031 may entitle you to recover every dollar paid — even if the work was done correctly.
How to Use §7031
- Verify license status through CSLB (cslb.ca.gov)
- Confirm the contractor was unlicensed at the time of work
- Gather all payment evidence
- Send a written demand for return of all compensation
- File a lawsuit if the contractor does not comply
Important Limitations
The "substantial compliance" defense allows a contractor to avoid §7031 if they prove they were licensed at all times, acted in good faith, and did not know they were unlicensed. This defense is narrow and rarely successful.
Bay Legal PC — Permit Violation Law Attorneys
Bay Legal PC in Palo Alto handles permit violation law disputes throughout California. Free initial consultations available.
Get a Free Consultation →Frequently Asked Questions
Does BPC §7031 apply if the contractor did good work?
Yes. Even if the work was done correctly, an unlicensed contractor cannot collect compensation and the property owner can recover all money paid. The quality of work is irrelevant under §7031.
How do I check if my contractor was licensed?
Search the CSLB website at cslb.ca.gov using the contractor’s name, license number, or business name. You can verify their license status at the time your work was performed.
Can I recover money from a contractor who was licensed but didn’t pull permits?
Yes, but through different legal theories: breach of contract and negligence rather than BPC §7031. You can recover the cost of permits, corrections, and related damages.
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Jayson Elliott, Bay Legal PC · Palo Alto, California
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