Contractors’ Right to Sue in Washington Requires Registration

Summary:

In Washington, contractors must be properly registered in order to pursue a legal action against a customer for breach of contract. Dobson v. Archibald, a February 2022 decision by the Washington Court of Appeals, reinforced how the governing statute – RCW 18.27.080 – does not simply create an affirmative defense but establishes a mandatory pleading prerequisite.¹

Discussion:

In 2018, Archibald hired Dobson to refinish his hardwood floors for $3,200. Dobson was not a registered contractor. She had been referred to Archibald by acquaintances who were familiar with her construction and home repair work, including improvements Dobson had made to her own home. Archibald paid Dobson a $700 deposit before Dobson began her work. At the completion of the floor repair project, Archibald was unhappy with the appearance of the floors and informed Dobson that he would not pay the remaining $2,500.

Dobson recorded a lien against Archibald’s property and filed suit in 2019. Archibald moved for summary judgment, asserting that Dobson could not bring suit because she was not a registered contractor. After a cross-motion for summary judgment by Dobson and Archibald’s motion for leave to amend his answer, the trial court granted Archibald’s summary judgment motion and dismissed Dobson’s suit with prejudice.

The Appellate Court’s analysis started with the statute RCW 18.27.080, which provides, in pertinent part:

No person engaged in the business 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 …

Dobson contended that nonregistration is an affirmative defense which must be timely pleaded and proved by the defendant. The Court rejected that contention, stating that the plain language of the statute does not support that view. The Court pointed also to Coronado v. Orona, 137 Wn. App. 308, 311 (“Washington contractors cannot sue clients to recover for compensation or for breach of contract if the contractors are not properly registered”). Therefore, registration must be alleged and proved by the plaintiff.

Dobson also contended that she was not a “contractor” under RCW 18.27.010(1)(a) and therefore did not need to be licensed. She argued that the registration requirement did not apply because she was primarily employed as a longshoreman and the flooring work she did for Archibald was “an isolated act in her spare time as a favor.” The Court looked to the statutory definition of a “contractor” and found that “[e]ven a single and isolated business venture is not exempt from the registration requirements of the registration act.”

The Court further clarified that the facts distinguished this case from Rose v. Tarman, 17 Wn. App. 160 (1977), on which Dobson relied. In Rose, the registration requirement did not apply where the parties were two friends with a longstanding social relationship. Here, Dobson and Archibald knew each other exclusively through this specific business transaction. Despite some superficial similarities, “[t]he narrow factual scenario that allowed Rose to avoid the registration bar is simply not applicable to Dobson.” Thus, the Appellate Court affirmed the trial court’s summary judgment dismissal of Dobson’s action.

Takeaways:

For contractors, this court decision reinforces the meaning and effect of Washington’s contractor registration act, RCW 18.27: contractor registration is a prerequisite to filing suit.

For legal practitioners, this Dobson case makes abundantly clear that plaintiffs must plead and prove contractor registration, and actions in the State of Washington that do not meet this pleading requirement will be subject to summary judgment dismissal.

________________________________________________________________________________________________________

¹ Dobson v. Archibald, 2022 WL 521496, 505 P.3d 115 (Feb. 22, 2022)