1. What Is HICPA?
HICPA radically changes the legal and business landscape for home improvement contractors in Pennsylvania. HICPA mandates that contractors register with the Pennsylvania Attorney General, Bureau of Consumer Protection (the “Bureau”), and imposes strict new standards and requirements for contracts to be legally enforceable and other business practices.
2. Who Does HICPA Apply to?
HICPA generally applies to contractors doing at least $5,000.00 of “home improvement” business annually.
A “home improvement” is defined broadly, and generally includes all work for more than $500.00 at a private residence or building or the adjacent land, for—
A) Repair, replacement, remodeling, demolition, removal, renovation, installation, alteration, conversion, modernization, improvement, rehabilitation or sandblasting; or
B) 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 unless excluded, painting, doors and windows and waterproofing, lighting systems, concrete walkways, the installation of central heating or air conditioning or storm windows or awnings, and the placement of retaining walls, fountains or drainage systems.
3. Why Do I Need A Contract?
HICPA provides that no home improvement contract shall be valid or enforceable against an owner unless, among many other things, it is in writing and legible, contains the home improvement contractor registration number of the performing contractor, and also complies with the many other requirements and prohibitions of HICPA. There are also many other potentially serious penalties for noncompliance with HICPA.
4. What Are the Penalties for Noncompliance with HICPA?
Penalties for noncompliance with HICPA may include, inter alia—A) All home improvement contracts which do not comply with HICPA are voidable at the option of the owner; B) Criminal prosecutions for home improvement fraud as a misdemeanor or third degree felony for first offenses; C) Civil penalties under the Pennsylvania Unfair Trade Practices and Consumer Protection Law (P.L. 1224, No. 387, December 17, 1968) such as attorneys fees and/or treble damages; and/or D) Revocation by the court of your contractor certificate and registration from the Bureau for a period of up to five years.
5. Can I Use My Existing Contract?
The current contract and/or change order documents you’re using are in all likelihood not in compliance with HICPA, and may subject you to the potentially serious penalties for noncompliance under HICPA.
6. What Must Be Included in a HICPA Compliant Contract?
HICPA compliant contract documents are available from the firm. For questions regarding compliance, contact Pat Henigan at 610-565-3700 for further information.
7. Where Can I Find a Copy of the Act?
You may download or print a copy of HICPA by going to the website of the Pennsylvania Office of Attorney General by clicking the link http://www.attorneygeneral.gov/hic.aspx, and clicking on the “Home Improvement Law” logo. You should personally read and review the complete HICPA law to ensure that you understand and comply with all of the terms, conditions, requirements and prohibitions of HICPA.
8. Is HICPA Applicable to All Contracts?
HICPA does not apply to a person for whom the total cash value of all that person’s home improvements is less than $5,000 during the previous taxable year; a home improvement retailer having a net worth of more than $50,000.000 or an employee of that retailer that does not perform home improvements, with certain exceptions as provided by HICPA; the construction of a new home; the sale of goods or materials by a seller who neither arranges to nor performs, directly or indirectly, any work or labor in connection with the installation or application of the goods or materials; 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; the sale of appliances, including stoves, refrigerators, freezers, room air conditioners and others which are designed for and are easily removable from the premises without material alteration; any work performed without compensation by the owner on the owner’s private residence or residential rental property; 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, or the placement of retaining walls, fountains or drainage systems; emergency work pursuant to the Unfair Trade Practices and Consumer Protection Law; the conversion of existing commercial structures into residential or noncommercial structures; the Commonwealth, or any of its political subdivisions; and the Federal Government.
Note— The information contained in this Frequently Asked Questions page should not be construed as legal advice and is meant as a general summary the HICPA law. The firm strongly recommends that you personally read and review the complete HICPA law to ensure that you understand and comply with all of the terms, conditions, requirements and prohibitions of HICPA.