The Massachusetts Home Improvement Contractor Act Is A Powerful Tool For Homeowners When A Dream Renovation Turns Into A Nightmare

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Even a smooth and successful home renovation project can be an enormous source of stress for a homeowner.  Often, homeowners feel powerless and overwhelmed when the inevitable hiccups arise in a renovation project due to the high cost and because the work may occur within one's living space.  For these reasons, and in recognition of the inherent imbalance in bargaining position once a renovation project is underway, homeowners should be aware of Massachusetts General Law Chapter 142A, also known as the Home Improvement Contractor Act. 


The Act sets out strict guidelines that provide significant protections and advantages to homeowners.  At its most fundamental level, Chapter 142A makes it unlawful for home improvement contractors to perform home improvement work unless they are registered with the office of consumer affairs and business regulation. The registration requirement not only helps ensure a minimal level of competence among registered contractors, but the required fee supports a guaranty fund that provides compensates of up to $10,000 to homeowners that are unable to collect on a judgment against a contractor that is either bankrupt or cannot be found.


The Act also limits the size of a down payment contractors may demand. Because a large upfront payment can effectively force a homeowner to stick with a contractor even after serious concerns arise, contractors may only request the greater of one third the contract price or the cost of the materials.


Contractors are also prohibited from starting any home renovation work unless there is a written contract that satisfies fourteen specific requirements, such as a detailed description of the work, the date on which the work is scheduled to begin and when it will be substantially completed, the total amount agreed to be paid, and a time schedule of the payments to be made under the contract. Once a project is underway, the Act prohibits a contractor from abandoning or failing to perform any contract or project without justification, failing to credit to the owner any payment made by the homeowner, or violating any applicable building code.  


Violations of the Act expose a contractor to administrative and even criminal sanctions.  Additionally, any violation of the Act that causes damage to the homeowner (as opposed to a technical violation) is considered a per se violation of Massachusetts General Law chapter 93A, which prohibits "unfair or deceptive practices" and entitles a prevailing plaintiff to multiple damages and attorney's fees.  Thus, for example, any building code violation exposes a contractor to liability to the homeowner for multiple damages and attorney's fees even if the homeowner knew about the violation beforehand.


While Chapter 142A is intended to protect homeowners from unscrupulous contractors, it has been criticized by some as being too heavy-handed toward home improvement contractors.  Nevertheless, it is undeniable that it provides a powerful incentive for contractors to ensure that they deal fairly and honestly with homeowners.  For these reasons and others, homeowners should be aware of the Act if trouble arises and the dream renovation starts to become a nightmare.


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