On August 29, 2021, Hurricane Ida made landfall in Louisiana, leaving catastrophic damage in her wake. With over a million people without power and billions of dollars in property damage, the restoration efforts are just beginning. For a state still recovering from last year’s hurricanes, contractors and building supplies are in high demand.
Such shortage of contractors, and the almost unlimited amount of work to be done, make southeast Louisiana an appealing target for both established out-of-state contractors and storm chasers alike looking to perform work on their own or with a Louisiana licensed joint venture partner.
The Louisiana Contractor Licensing Laws and Statutes require a commercial contractor’s license for projects of $50,000.00 or more, hazardous materials projects in excess of $1.00, and for plumbing, mechanical, and electrical work on commercial projects of $10,000.00 or more. Residential contractors must also be licensed if either the project awarded is $75,000.00 or more, or if the work exceeds $7,500.00 for residential pile driving, foundation, framing, roofing, masonry, or swimming pool work. These maximum limits include both labor and materials. Further, a joint venture agreement with a Louisiana contractor will not automatically cloak the out-of-state contractor with the necessary licensure. The out-of-state contractor must possess its own licenses, in its own name, in the event it performs work exceeding the statutory thresholds.
It is important to note that in addition to the civil and criminal penalties that unlicensed contractors may face, these parties may be unable to enforce contractual terms and conditions, including lien claims on unpaid projects. Thus, it is imperative that out-of-state contractors familiarize themselves with applicable Louisiana contractor licensing laws and consult legal counsel with contractor licensing experience whenever questions arise.