8C — August 11 - 24, 2017 — Pennsylvania — M id A tlAntic

Real Estate Journal


P ennsylvania

By matthew hennesy, Esq., Barley snyder making sense of PA’s hICPA Regulations

in the early 2000s, Penn- s y l v a n i a fought back in 2009 and established its Home Im- provement C o n s ume r Pr o t e c t i on Act. W

hen scam artists flooded the con- struction industry

and is far-reaching in its scope of contractors, subcontractors and independent contractors that must register. Even though the act has only been on the books since 2009, it already has been amended twice, the latest coming in 2014. It likely will see more changes in the fu- ture. Though there are a mul- titude of specific instructions and conditions contained within the HICPA regula- tions, Neep these five things in mind when working to comply with HICPA in Pennsylvania: 1. All contractors are re-

quired to register and must provide a multitude of in- formation. That information includes: ‡ A complete description of the type of the contracting ‡ 'isclosure of criminal convictions for fraud, theft, and crimes of deception, bank- ruptc\ filings, and civil Mudg- ments in the past decade related to home improvement transactions ‡ :hether the contractor has ever previously been suspended by a government or disqualified from public funded contracting

‡ 3roof of liabilit\ insurance 2. With the act came a new criminal offense – home im- provement fraud. A contractor could face the charge if there is proof of false representa- tions of an agreement for home improvement services, taking advance payment but failing to provide the services or materials and misrepre- senting an item as special order material or misrepre- senting the cost of special order material. 3. The validity of all con- tracts is largely dependent on whether the contract satisfies

certain requirements, which include that all contracts be legible, signed by both par- ties, contain all contractor contact information, give an approximate start and completion date, a total sales price due, the names of all subcontractors with contact information, along with other requirements. 4. Document all change or- ders – both from the contrac- tor and from the consumer. Make sure both parties agree on and understand the rami- fications of the change order. To comply with the state’s contract requirements, both parties must sign any change order. 5. Consumers aren’t the only ones protected under the act. State courts have held that if a construction contract is voided, invalid or unenforceable, contrac- tors can pursue a claim for the “reasonable value of the services.” If all of this doesn’t convince you to comply with contract requirements, consider that staying within the bounds of the act will help you avoid civil enforcement by the at- torney general, will allow for recovery of full contract damages, and will make col- lection easier. If the contract is invalid, unenforceable, or voided, so are any supple- mental provisions. Because HICPAmakes violation of any of its provisions a violation of the Unfair Trade Practices and Consumer Protection Law, plaintiffs could seek damages and attorney fees for a breach of HICPA. All home improvement con- tractors should simply stay within the confines of +,C3A. Be sure you register your com- pany. Use compliant contracts and clear, detailed plans, as many disagreements with consumers involve a misun- derstanding about what is be- ing done. Stick to those plans, and use written change orders when appropriate. If the owner requests a change, document it with a written change order including price adjustment signed by all parties. matthew hennesy is an associate at Barley sny- der, a seven-office law firm in central Pennsylvania. matthew is a member of the firm’s Construction and litigation practice groups. n


Under HICPA, the state requires registration of con- tractors doing any work over $500 on a private residence

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