Should the HOA name itself as the "General Contractor?”

Started by KerryL1 • 38 replies • 946 views

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KerryL1 (California)
Posts: 14,550

Posted:

I've been on our board for about 12 years and we have approved numerous contracts (high rise with lotsa work always needed.)

We now have an active board of 5 (instead of bylaws-stated 7) and two, yes, two—“Jack & Jill”— are retired lawyers. Neither were in HOA law or contact law, but the board approved them vetting our approved contracts instead of our HOA attorney. All of our previous contracts referred to our HOA as the "client," "customer," or "the Association.”

The most recent contract refers to our HOA as the “General Contractor.” This is OK with J&J. I think in CA, general contractors must be licensed. This title feels wrong to me, seems like it could make us liable for certain things, etc., but I won’t have time to google about the title until tomorrow.

Any insights??

MarkM31 (Washington)
Posts: 494

Posted:

What is the scope of thewir wanting to be a GC? Chances are if it is only to hire ewmployes to sewlf pwereform work on HOA property, that qould be allowed. Most of the issues with California contractors is in rweference to performing work for others.
http://www.cslb.ca.gov/Consumers/Building_Officials/Owner_Builder_Overview.aspx

MarkM31 (Washington)
Posts: 494

Posted:

Sorry for the spelling. Editing is not allowed on this Paleozoic website

KerryL1 (California)
Posts: 14,550

Posted:

I think you're asking, Mark, if the vendor or J&J want the HOA to hire employees??? The answer is no.

The contract does already give the vendor the right to hire subs.

I guess my question is actually a legal question and we do have free phone calls to our HOA general counsel--well, it's part of our $500 annual retainer.

RichardP13 (California)
Posts: 3,868

Posted:

One of your lawyers does/did workers comp and the other says they did Homeowner Association Matters.

If a contractor or general contractor is in a California Construction contract, they are required to provide their contractors license. Contract Law is one of the basis laws taught when someone takes Business Law, which is a requirement for a bachelor's or associates's degree.

I am pretty sure the HOA doesn't have a contractor's license, BUT I could be wrong.

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By RichardP13 on 07/28/2018 6:05 PM
One of your lawyers does/did workers comp and the other says they did Homeowner Association Matters.

If a contractor or general contractor is in a California Construction contract, they are required to provide their contractors license. Contract Law is one of the basis laws taught when someone takes Business Law, which is a requirement for a bachelor's or associates's degree.

I am pretty sure the HOA doesn't have a contractor's license, BUT I could be wrong.

No. Did you follow the link I provided? Owners do not need a CSLB contractor(s) license when they are acting as a contractor on their own property.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By MarkM31 on 07/28/2018 6:14 PM

No. Did you follow the link I provided? Owners do not need a CSLB contractor(s) license when they are acting as a contractor on their own property.

Do you really think your link would apply to a mid-high rise in a downtown area. I don't think they have unit owners hanging out their windows on a scaffold on First Street trying to repair their balconies.

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By RichardP13 on 07/28/2018 6:52 PM

Do you really think your link would apply to a mid-high rise in a downtown area. I don't think they have unit owners hanging out their windows on a scaffold on First Street trying to repair their balconies.

Again, read the link. It doesn’t seem like you have. It is likely that the case you made up wouldn’t be applicable because the owner did not have a glaziers license. The HO exemption applies to those doing trade work to SFRs. What the link shows in answer to the OPs question, and in rebuttal to your assertion, is that a HOA does not need a GC license when acting as a GC for their properties.

Try to keep up

RichardP13 (California)
Posts: 3,868

Posted:

And who are the Owners? Yeah, I did read it, it doesn't apply!

WHAT A CLOWN

KerryL1 (California)
Posts: 14,550

Posted:

Brrrrrr. Richard seems to have become a stalker....perhaps an unsuccessful one. Why, Richard, are you so obsessed with my HOA and where it might be located?

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By RichardP13 on 07/28/2018 7:40 PM
And who are the Owners? Yeah, I did read it, it doesn't apply!

WHAT A CLOWN

You’ve made you opinion very clear. I’ll let the link speak for itself, and others can interpret it themselves. Seems like you don’t have grasp on the role of a GC, your AA degree notwithstanding.

KerryL1 (California)
Posts: 14,550

Posted:

I looked at Mark's citation too and I guess I don't understand it. I'll try again tomorrow. I do recall that Mark is very familiar with some of the trades and crafts, unlike anyone on our board.

And...there are no glazers involved, rather a building maintenance firm's employees, who''ll be in baskets. All of the windows that glaziers might work on can be done from the unit interiors --no scaffolding needed.

GeorgeS21 (Florida)
Posts: 3,808

Posted:

Mark,

What’s with the “Try to keep up comment?”

You can probably contribute to the suppliers of this site to update it with an edit feature - I’m sure they would appreciate it.

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By KerryL1 on 07/28/2018 8:21 PM

And...there are no glazers involved, rather a building maintenance firm's employees, who''ll be in baskets. All of the windows that glaziers might work on can be done from the unit interiors --no scaffolding needed.

The reference to glaziers was just a fer-instance in regards of dangling over the side in swing stages working on the balconies. Could be iron heads, carps, or masons also, it’s impossible to tell without knowing the building. The point is, that CA is very specific about the licensing of specific trades, as well as GCs even if they are “paper generals” who only shuffle paper. When these contractors are working for the general public, they require a GC license. If they do trade work they also need the applicable trade license such as structural iron or framing. The law allows a HOA to act as it’s own GC without a GC license. But the trade work must be licensed.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By KerryL1 on 07/28/2018 8:04 PM
Brrrrrr. Richard seems to have become a stalker....perhaps an unsuccessful one. Why, Richard, are you so obsessed with my HOA and where it might be located?

HOW many times have you said, I am on a Board of a high rise 211 unit twin tower, in California. Do a google search and it's pretty easy to find. So reading Mark's citation, couldn't find an important reference, homeowners association.

I have read a number of contracts associated with work being done on behalf of an HOA and never have seen a HOA being reference as a "GC".

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By MarkM31 on 07/28/2018 8:19 PM

Posted By RichardP13 on 07/28/2018 7:40 PM
And who are the Owners? Yeah, I did read it, it doesn't apply!

WHAT A CLOWN

Sorry, don't have an AA and never been to one of their meetings.

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By RichardP13 on 07/28/2018 8:46 PM

Posted By KerryL1 on 07/28/2018 8:04 PM
Brrrrrr. Richard seems to have become a stalker....perhaps an unsuccessful one. Why, Richard, are you so obsessed with my HOA and where it might be located?

Read the first post. That is what the lawyer/board members in the BOD want to do.

RichardP13 (California)
Posts: 3,868

Posted:

I read the first post and the lawyers are full of, well you know.

Or are we not supposed to question the integrity of such an esteemed profession.

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By RichardP13 on 07/28/2018 8:53 PM
I read the first post and the lawyers are full of, well you know.

Or are we not supposed to question the integrity of such an esteemed profession.

What they want to do is certainly optional, but again, you were the one who vociferously stayed that GCs must be licensed. That is decidedly not correct in this case.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By MarkM31 on 07/28/2018 9:03 PM

Posted By RichardP13 on 07/28/2018 8:53 PM
I read the first post and the lawyers are full of, well you know.

Or are we not supposed to question the integrity of such an esteemed profession.

What they want to do is certainly optional, but again, you were the one who vociferously stayed that GCs must be licensed. That is decidedly not correct in this case.

From your citation. What part would apply to Kerry's place. Maybe she can chime in.

An owner-builder is exempt from licensure, but there are limitations.

A license is not required if:

The owner-builder does the work himself or herself or through his or her own employees with wages as their sole compensation and the structure(s) is/are not intended for sale.
The owner-builder contracts with properly licensed subcontractor(s).
(This exemption applies to the construction of a single-family residential structure and limits the number of structures intended or offered for sale to four or fewer in a calendar year.)
The owner-builder contracts with a General Building ("B") contractor. (The number of structures is then unlimited.)

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By RichardP13 on 07/28/2018 9:14 PM

Posted By MarkM31 on 07/28/2018 9:03 PM

Posted By RichardP13 on 07/28/2018 8:53 PM
I read the first post and the lawyers are full of, well you know.

Or are we not supposed to question the integrity of such an esteemed profession.

What they want to do is certainly optional, but again, you were the one who vociferously stayed that GCs must be licensed. That is decidedly not correct in this case.

We don't know the scope of work nor the status of the contractor. So to answer you question, some, none or all could apply. I answered this thread regarding the question "must GC's in California be licensed" and the answer clearly in this case is not neccesarily.

Fell free to "what-about" till the cows come home.

GeorgeS21 (Florida)
Posts: 3,808

Posted:

Mark,

What is with the “feel free to what about till the cows come home?”

You sound negative about others’ thoughts regarding your question ...I don’t get it.

KerryL1 (California)
Posts: 14,550

Posted:

Still trying to understand Mark's citation. I think he's saying that our Association IS an "Owner." As such, we don't need a license to call ourselves a General Contractor."

Having seen maybe 30 contracts for our building over time, and never having seen our HOA termed "General Contractor" in contracts, it caught my eye. My concern was/is: does that give my HOA extra risk of liability?

Mark wrote: "We don't know the scope of work nor the status of the contractor." The scope is exterior maintenance: polishing the architectural metals, which were factory-power coated. These metals are the mullions and Panels that comprise our curtain system that (basically) envelopes our building.

Mark's above quote made something else click: Maybe the vendor wants us to be the GC because they don't have a contractors license?? Looked at the proposal again and then at their website. So far as I can see, they have no contractors license. In looking at all their services, mainly building power washing, window washing, glass restoration, metal restoration, graffiti removal, the only craft I see that might require a license is "building caulking." But I don't know. Our caulking, for instance, is mainly the horizontals between the metals of the building system. Our window glass is secured by a butyl seal, not caulking.

Maybe I should be more concerned now??

The brilliant J&J missed many errors on the contract's first page including incorrect property address; improper HOA name; lack of a contract term; no mention of who supervises the vendor.

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By KerryL1 on 07/29/2018 9:44 AM
Still trying to understand Mark's citation. I think he's saying that our Association IS an "Owner." As such, we don't need a license to call ourselves a General Contractor."

Having seen maybe 30 contracts for our building over time, and never having seen our HOA termed "General Contractor" in contracts, it caught my eye. My concern was/is: does that give my HOA extra risk of liability?

Mark wrote: "We don't know the scope of work nor the status of the contractor." The scope is exterior maintenance: polishing the architectural metals, which were factory-power coated. These metals are the mullions and Panels that comprise our curtain system that (basically) envelopes our building.

Mark's above quote made something else click: Maybe the vendor wants us to be the GC because they don't have a contractors license?? Looked at the proposal again and then at their website. So far as I can see, they have no contractors license. In looking at all their services, mainly building power washing, window washing, glass restoration, metal restoration, graffiti removal, the only craft I see that might require a license is "building caulking." But I don't know. Our caulking, for instance, is mainly the horizontals between the metals of the building system. Our window glass is secured by a butyl seal, not caulking.

Maybe I should be more concerned now??

The brilliant J&J missed many errors on the contract's first page including incorrect property address; improper HOA name; lack of a contract term; no mention of who supervises the vendor.

Likely (as in 20 million to one), if you read the CC&Rs for your muti-floor building, you will see that the structure and exterior are common elements. And as such, are owned by the HOA. The HOA isn't "an owner", the HOA is the only owner.

KerryL1 (California)
Posts: 14,550

Posted:

I know our CC&Rs very well, Mark and, of course, the building exteriors, except of our exclusive use common area balconies, are solely common area.

But I don't get: "Likely (as in 20 million to one),..."

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By KerryL1 on 07/29/2018 11:03 AM
I know our CC&Rs very well, Mark and, of course, the building exteriors, except of our exclusive use common area balconies, are solely common area.

But I don't get: "Likely (as in 20 million to one),..."

Doesn't matter if it's a "sole use common area" or a common area, all of it is owned by the HOA.

The 20 million to one is because I can't read your CC&Rs.

KerryL1 (California)
Posts: 14,550

Posted:

Update: the material I read in my Directors Report was incorrect--was the version before J&J vetted. Their real work was delivered to us right before the board meeting last night, so we postponed our decision as the new version wasn't redlined and side-by-side comparisons would've taken too much time. So, I did them wrong by thinking they'd done sloppy work.

Anyway, we are no longer the General Contractor, but the client and the vendor does indeed have some contractors licenses.

MarkM31 (Washington)
Posts: 494

Posted:

All that for nothing

GuyM1 (Ohio)
Posts: 318

Posted:

Richard

Just my two cents! Why would the HOA want the responsibility for problems that could occur like someone getting hurt or future damages? This would make every owner responsible for anything that would happen! Did you take a vote of members on the subject? So if something happened who would you sue? Also, the board and its board members would be sued for all the damages! This also would leed into Fiduciary Duty lawsuit IMO!

This is a bad way to try and save money!

Thanks,
Guy

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By GuyM1 on 08/04/2018 7:38 AM
Richard

Just my two cents! Why would the HOA want the responsibility for problems that could occur like someone getting hurt or future damages? This would make every owner responsible for anything that would happen! Did you take a vote of members on the subject? So if something happened who would you sue? Also, the board and its board members would be sued for all the damages! This also would leed into Fiduciary Duty lawsuit IMO!

This is a bad way to try and save money!

Thanks,
Guy

WHY are you addressing this to me?

GuyM1 (Ohio)
Posts: 318

Posted:

Sorry, Richard was reading so far down forgot who the OP was.

GuyM1 (Ohio)
Posts: 318

Posted:

Just my two cents! Why would the HOA want the responsibility for problems that could occur like someone getting hurt or future damages? This would make every owner responsible for anything that would happen! Did you take a vote of members on the subject? So if something happened who would you sue? Also, the board and its board members would be sued for all the damages! This also would leed into Fiduciary Duty lawsuit IMO!

This is a bad way to try and save money!

Thanks,
Guy

RichardP13 (California)
Posts: 3,868

Posted:

I believe someone "jumped" the gun on something they didn't quite understand and mainly because of who that person(s) was dealing with on their Board.

Someone else try to make the argument that the HOA COULD be the General Contractor. Show me the proof!

The person provides a link to a website that shows no relationship between an Owner and the HOA, not one reference.

I think at the end of the day this was a case of mistaken identity.

MarkM31 (Washington)
Posts: 494

Posted:

The HOA can call themselves whatever they want, including GC. Their scope did not intrude upon that which requires a GC license, and window washers require no licensing.
http://www.cslb.ca.gov/Resources/GuidesAndPublications/DescriptionOfClassifications.pdf

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By MarkM31 on 08/04/2018 8:58 AM
and window washers require no licensing.

Hope they have good heath plans and insurance.

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By RichardP13 on 08/04/2018 9:17 AM

Posted By MarkM31 on 08/04/2018 8:58 AM
and window washers require no licensing.

Hope they have good heath plans and insurance.

Which has nothing to do with the topic at hand. All contractors who work for somebody as anything other than a employee should be insured and have a business license. Anybody who works for the window washing company should be fully covered by their employers insurance.

But window washing contractors are not required to hold CSLB licenses.

The HOA could choose to hire window washers directly as employees on their own properties. But they (the HOA) would have to have full employer coverage for these people.

RichardP13 (California)
Posts: 3,868

Posted:

Quote:

Posted By MarkM31 on 08/04/2018 9:35 AM

Posted By RichardP13 on 08/04/2018 9:17 AM

Posted By MarkM31 on 08/04/2018 8:58 AM
and window washers require no licensing.

Hope they have good heath plans and insurance.

But window washing contractors are not required to hold CSLB licenses.

PLEASE, I beg you, take that up with the CSLB.

With few exceptions, HOA's don't hire employees. They hire others who have employees and they are covered by the companies the HOA hired.

IMO, a Board who willingly hires windows washers, as employees, should be sent directly to a mental institution, do not pass go, do not collect $200.00.

Could there be an "obscure" HOA that fits your argument, maybe, but the OP's is NOT one of them.

MarkM31 (Washington)
Posts: 494

Posted:

Quote:

Posted By RichardP13 on 08/04/2018 9:50 AM

Posted By MarkM31 on 08/04/2018 9:35 AM

Posted By RichardP13 on 08/04/2018 9:17 AM

Posted By MarkM31 on 08/04/2018 8:58 AM
and window washers require no licensing.

Hope they have good heath plans and insurance.

But window washing contractors are not required to hold CSLB licenses.

PLEASE, I beg you, read the entire post.

The HOA can call themselves a GC all day long, and hire a properly insured window washing company with a business license. Neither the HOA nor the window washing company would be required to hold any type of CLSB contractor license.

RichardP13 (California)
Posts: 3,868

Posted:

I think you got way too much caffeine in the system.

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