Contract with Contractor

If the board signs a contract with a contractor (in CA) not knowing that the contractor was unlicensed and then discovers the unlicensed status of the contractor, followed by the contractor obtaining a license, is the contract still in force? Or, should a new contract with the now licensed contractor be signed?

Could work either way. All depends.

If the Board guidelines clearly stipulate that no unlicensed contractors should be hired on, then for him/her to continue on can raise serious integrity questions.

You can't make a right out of a wrong. The first contract was illegal....not only according to Board guidelines, but according to your local ordinances and statutes. The first contract may not necessarily be legally binding.

Do it the right way. Stop all work on the project, immediately. Nullify any previous agreements, including the contract which wasn't legal to begin with.

Draw up a new contract.....the legal one.....then put him/her back to work. That way, the courts will have a lot more respect for you and the Board in the event there are any present or future legal issues.