[atlas:bill]

AN ACT Relating to notice requirements of general or specialty contractors; and amending RCW 18.27.114 and 18.27.080.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF WASHINGTON:

Sec. 1. RCW 18.27.114 and 1997 c 314 s 12 are each amended to read as follows:

(1) Until the effective date of this section, any contractor agreeing to perform any contracting project: (a) For the repair, alteration, or construction of four or fewer residential units or accessory structures on such residential property when the bid or contract price totals one thousand dollars or more; or (b) for the repair, alteration, or construction of a commercial building when the bid or contract price totals one thousand dollars or more but less than sixty thousand dollars, must provide the customer with the following disclosure statement prior to starting work on the project:

"NOTICE TO CUSTOMER

This contractor is registered with the state of Washington, registration no. . . . ., as a general/specialty contractor and has posted with the state a bond or cash deposit of $6,000/$4,000 for the purpose of satisfying claims against the contractor for negligent or improper work or breach of contract in the conduct of the contractor's business. The expiration date of this contractor's registration is . . . . . . This bond or cash deposit may not be sufficient to cover a claim which might arise from the work done under your contract. If any supplier of materials used in your construction project or any employee of the contractor or subcontractor is not paid by the contractor or subcontractor on your job, your property may be liened to force payment. If you wish additional protection, you may request the contractor to provide you with original "lien release" documents from each supplier or subcontractor on your project. The contractor is required to provide you with further information about lien release documents if you request it. General information is also available from the department of labor and industries."

(2) On or after the effective date of this section, any contractor agreeing to perform any contracting project: (a) For the repair, alteration, or construction of four or fewer residential units or accessory structures on such residential property when the bid or contract price totals one thousand dollars or more; or (b) for the repair, alteration, or construction of a commercial building when the bid or contract price totals one thousand dollars or more but less than sixty thousand dollars, must provide the customer with the following disclosure statement prior to starting work on the project:

"NOTICE TO CUSTOMER

This contractor is registered with the state of Washington, registration no. . . . ., as a general/specialty contractor and has posted with the state a bond or cash deposit of $. . . . . ./$. . . . . for the purpose of satisfying claims against the contractor for breach of contract in the conduct of the contractor's business. The expiration date of this contractor's registration is . . . . . .. This bond or cash deposit may not be sufficient to cover a claim which might arise from the work done under your contract. If any supplier of materials, to the contractor or subcontractor, used in your construction project or any employee of the contractor or subcontractor is not paid by the contractor or subcontractor on your job, your property may be liened to force payment. If you wish additional protection you should consider the following: (1) Requesting that the contractor provide you with original "lien release" documents from each supplier or subcontractor on your project; (2) employing the services of a construction contract control company or individual for complete or partial financial oversight of your construction project; (3) requiring by contract that your contractor furnish you with a payment and performance bond to guarantee payment of suppliers and subcontractors and performance of your construction project; (4) employing the services of an attorney or other construction professional to review and advise you regarding your construction project; (5) entering into a joint check arrangement with your contractor and his or her subcontractors and suppliers to insure that payment is made to those parties; and (6) withholding a contractually defined percentage of your construction contract as retainage for a stated period of time to provide protection to you and help insure that your project will be completed as required by your contract. General information regarding these protections is also available from the contractor's section of the department of labor and industries by contacting them at the following telephone number: . . . . . . . . . . . . and/or internet address: . . . . . . . . . . . . . . .. In addition, you may request that the contractor's section provide you with a contractor "summary sheet" setting forth a contractor's name, address, telephone number, registration number, claims, bonding and insurance history, and past registrations, if any."

(3) A contractor subject to this section shall notify any consumer to whom notice is required under subsections (1) and (2) of this section if the contractor's registration has expired or is revoked or suspended by the department prior to completion or other termination of the contract with the consumer.

((~~(3)~~)) (4) No contractor subject to this section may bring or maintain any lien claim under chapter 60.04 RCW based on any contract to which this section applies or bring or maintain any action in any court of this state for the collection of compensation for the performance of any work or for breach of any contract for which registration is required under this chapter without alleging and proving that the contractor has provided the customer with a copy of the disclosure statement as required in subsection (1) or (2) of this section.

((~~(4)~~)) (5) This section does not apply to contracts authorized under chapter 39.04 RCW or to contractors contracting with other contractors.

((~~(5)~~)) (6) Failure to comply with this section shall constitute an infraction under the provisions of this chapter.

((~~(6)~~)) (7) The department shall produce model disclosure statements, and public service announcements detailing the information needed to assist contractors and contractors' customers to comply under this section. As necessary, the department shall periodically update these education materials.

Sec. 2. RCW 18.27.080 and 1988 c 285 s 2 are each amended to read as follows:

No person engaged in the business of contracting or acting in the capacity of a contractor may bring or maintain any action in any court of this state for the collection of compensation for the performance of any work or for breach of any contract for which registration is required under this chapter without alleging and proving that he or she was a duly registered contractor, in compliance with the notice to customer requirements of RCW 18.27.114, if applicable, and held a current and valid certificate of registration at the time he or she contracted for the performance of such work or entered into such contract. For the purposes of this section, the court shall not find a contractor in substantial compliance with the registration requirements of this chapter unless: (1) The department has on file the information required by RCW 18.27.030; (2) the contractor has a current bond or other security as required by RCW 18.27.040; ((~~and~~)) (3) the contractor has current insurance as required by RCW 18.27.050; and (4) the contractor has complied with the notice to customer requirements of RCW 18.27.114, if applicable. In determining under this section whether a contractor is in substantial compliance with the registration requirements of this chapter, the court shall take into consideration the length of time during which the contractor did not hold a valid certificate of registration.