August 19, 1999
JOHN WATKINS, APPELLANT,
TULANE HOWARD, APPELLEE.
Before Steadman, Ruiz and Reid, Associate Judges.
The opinion of the court was delivered by: Ruiz, Associate Judge
Appeal from the Superior Court of the District of Columbia (Hon. Evelyn E. Queen, Trial Judge)
Argued September 28, 199
This appeal arises out of a home improvement contract dispute. On the day of trial, the trial court granted summary judgment to appellee, Tulane Howard, the homeowner, and dismissed the complaint of appellant, John Watkins, the home improvement contractor. The Judge ruled that Watkins violated 16 DCMR § 800.1 (1997) by entering into a home improvement contract requiring progress payments without a license, and, therefore, that the contract was unenforceable. We reverse and remand because there is a factual dispute as to whether the contract as executed required progress payments, and whether Watkins accepted progress payments without a license.
On July 7, 1994, Watkins, a building contractor, entered into an agreement with Howard, a homeowner, to perform construction work totaling $55,000 at Howard's home at 4501 Davenport Street, N.W. At the time Watkins entered into this agreement, he did not have a home improvement contractor's license. On August 24, 1994, Watkins obtained the required license and started work thereafter. *fn1 During the course of the contract, Watkins received four payments from Howard totaling $44,800:
November 5, 1994: $11,000
December 10, 1994: $11,000
February 10, 1995: $11,000
May 12, 1995: $11,800
On July 28, 1995, Watkins received a letter from Howard's attorney instructing him to complete work on the contract by September 1995. Watkins received a second letter from Howard's attorney on August 7, 1995, notifying him that his services were no longer needed. Subsequently, Howard changed the locks on the Davenport Street premises preventing Watkins from completing work under the contract.
Watkins brought a breach of contract action against Howard seeking to recover $20,000 he claimed was still owed for materials purchased and work completed under the contract. Howard responded with a counterclaim for the $44,800 already paid to Watkins, arguing that the contract was void and unenforceable because Watkins did not have a license on the date the contract was executed and failed to maintain a valid license throughout the contract period.
On April 28, 1997, the scheduled date of trial, the trial court held a hearing on Howard's pending motion for reconsideration of his motion for summary judgment. The trial court concluded the hearing by granting summary judgment in favor of Howard stating that there was no genuine issue of material fact in dispute since Watkins did not have a license on the date he entered into a contract requiring progress payments prior to completion of the contract work. *fn2 The court explained:
"[T]here was no license . . . on the date of the execution of the contract and the contract that you are suing on of July 1994 . . . contain[s] terms for partial payments . . . [Therefore] I'm going to grant summary judgment on behalf of defendant Tulane Howard in this matter."
After concluding that the contract was void as a matter of law, the trial court also granted summary judgment to Howard on the counterclaim for recovery of the $44,800 paid under an illegal contract. The trial court subsequently denied Watkins' Rule 59 (e) motion for reconsideration of both summary judgments. Watkins appeals from the trial court's grant of summary judgment in favor of Howard.
The regulation at issue in this case provides that:
"No person shall require or accept any payment for a home improvement contract in advance of the full completion of all work required to be performed under the contract, unless that person is licensed as a home improvement contractor . . . ." 16 DCMR § 800.1 (1998) (emphasis added).
An "advance payment" is defined as any payment "in advance of the full completion of all work required to be performed under the contract." Cevern, Inc. v. Ferbish, 666 A.2d 17, 19 n.1 (D.C. 1995) (citing 16 DCMR § 800.1 (1993)) (emphasis added). This court consistently has held home improvement contracts void where unlicensed contractors have accepted or received payments before full completion of the work. See id. at 19-20 (contractor received progress payment before obtaining license); Marzullo v. Molineaux, 651 A.2d 808, 811 (D.C. 1994) (unlicensed contractors accepted payment prior to completion of the project); Capital Constr. Co., v. Plaza West Coop Ass'n, 604 A.2d 428, 432 (D.C. 1992) (per curiam) (contractor accepted progress payments after license had expired); Nixon v. Hansford, 584 A.2d 597-99 (D.C. 1991) (unlicensed contractor accepted payments prior to completion of contract); Erwin v. Craft, 452 A.2d 971, 972 (D.C. 1982) (same); Truitt v. Miller, 407 A.2d 1073, 1079 (D.C. 1979) (same); Miller v. Peoples Contractors, Ltd., 257 A.2d 476 (D.C. 1969) (same). As for the "require" language, we have said that "a violation of the regulation occurs *fn3 when the [unlicensed] contractor enters a home improvement contract which requires advance payment." *fn4 Woodruff, supra, note 3, 524 A.2d at 725 (citation omitted) (emphasis added). In this case, it is premature to decide whether the contract was in violation of the regulation because there are still disputed questions of fact as to whether the contract required advance payments, and whether the contractor in fact accepted progress payments, during the time that the contractor was unlicensed.
Although the trial court found that the July 7, 1994 contract contains terms for progress payments, it is not undisputed on the record that these terms are part of the initial contract. Unlike the two-page July 7, 1994 contract signed by both parties, which does not provide for progress payments, the document allowing for such payments is neither dated nor signed. *fn5 Moreover, this same document lists various credits and adjustments to the initial contract, which suggests that it was prepared after the July 7, 1994 contract execution date. *fn6
Finally, although the record indicates that Watkins obtained his license on August 24, 1994, it is unclear whether he maintained his license throughout the time he performed work on the contract. An administrative opinion from the District of Columbia Department of Consumer and Regulatory Affairs, Business Regulatory Administration, dated March 13, 1996, states that Watkins' home improvement contractor license expired December 31, 1994, and that if Watkins operated as a home improvement contractor from January 1, 1995 to October 20, 1995, he was acting illegally as "licenses are not retroactive from the time the license fee is paid." An October 30, 1995 copy of Watkins' license, however, indicates that his license was valid for the period of January 1, 1995 through December 31, 1995. This license was also issued by the Business Regulatory Administration. Given this conflicting evidence in the record, there is certainly a material dispute as to the time periods during which Watkins had a home improvement license.
Because there are genuine issues of material fact in dispute as to whether progress payment were contractually required and, if so, when that requirement became effective and what Watkins' licensure status was at that time, summary judgment was inappropriate in this case. Therefore, we reverse and remand. *fn7
Reversed and remanded.