Peacock Tales
Volume 19, Number 1 · January 2009The New Pennsylvania Home Improvement Consumer Protection Law
Safeguarding consumers from dishonest and unethical contractorsConsumer Protection Law
On October 17, 2008, the Governor of Pennsylvania signed into law the Pennsylvania Home Improvement Consumer Protection Law. The law is intended to safeguard consumers from dishonest and unethical contractors by requiring that all home improvement contractors register with the Attorney General's office by July 1, 2009. The registration number for each contractor must be displayed and provided to potential customers. Customers can then verify a contractor's status with the Attorney General's office and report any complaints. At the time of registration, the home improvement contractor will need to provide proof of liability insurance covering personal injury in an amount not less than $50,000 and property damage also in an amount not less than $50,000. The registration fee is $50 paid every other year.
In addition to the registration requirement, contractors must include the following provisions in their contracts: (1) the approximate commencement date and completion date; (2) a description of the work; (3) names and addresses of all subcontractors to be used; (4) an assurance that the contractors will maintain insurance; and (5) the total contract price. The customer must be provided with a copy of the signed contract.
Other highlights of the bill include:
- The law exempts contractors doing less than $5,000 in business annually from registering.
- A home improvement retailer (e.g. Home Depot, Lowe's) having a net worth of more than $50 million is also exempt.
- The term "home improvement" includes the following done in connection with a private residence where the total cash price of all work agreed upon is more than $500:
- Repair, replacement, remodeling, demolition, removal, renovation, installation, alteration, conversion, modernization, improvement, rehabilitation or sandblasting.
- Construction, replacement, installation or improvement of driveways, swimming pools, pool houses, porches, garages, roofs, siding, insulation, solar energy systems, security systems, flooring, patios, fences, gazebos, sheds, cabanas, landscaping of a type that is not excluded, painting, doors and windows and waterproofing.
- Without regard to affixation, the installation of central heating or air conditioning or storm windows or awnings.
- Repair, replacement, remodeling, demolition, removal, renovation, installation, alteration, conversion, modernization, improvement, rehabilitation or sandblasting.
- The term does not include:
- The construction of a new home.
- The sale of services furnished for commercial or business use or for resale, if the service takes place somewhere other than at a private residence.
- Any work performed by a landscaper certified by the Department of Agriculture under the Plant Pest Act, except to the extent that the work involves any of the following:
The construction, replacement, installation or improvement of buildings, driveways, swimming pools, porches, garages, roofs, siding, insulation, solar energy systems, security systems, flooring, patios, nondecorative fences, doors, lighting systems, concrete walkways and windows. The placement of retaining walls, fountains or drainage systems.
- The construction of a new home.
For a home improvement contract in which the total price is more than $1000, a contractor may not receive a deposit in excess of 1) one-third of the home improvement contract price, or 2) one-third of the home improvement contract price plus the cost of special order materials that have been ordered.
The law provides for more stringent criminal and civil penalties against contractors for violation of the law.
There are several other, more detailed, provisions of the law that may be applicable depending on the nature of the improvement. If you are a contractor or a consumer and have questions regarding its applicability, please call your PK&E attorney.