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| Check on a Contractor's License |
| Best Practices for Hiring Contractors |
| What does "bonded and insured" mean? |
| What should be in a contract? |
| What is an arbitration clause? |
| What is a construction lien? |
| What should I do if I have a problem with a contractor? |
| Top Five Consumer Mistakes |
| Other Consumer Protection Websites |
| Consumer Publications |
| What is workers' compensation coverage? |
| Consumer Education Events Schedule |
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| Check on a Contractor's License |
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Why check a contractor’s license? The Construction Contractors Board (CCB) believes the best way to a successful home improvement, repair or new home project is to know your contractor. Checking a contractor’s license can tell you:
- If the contractor is actively licensed, which means they have a surety bond and liability insurance;
- If the contractor carries Workers' Comp Insurance to protect its workers on the project;
- Breach of contract complaints filed with the CCB in the past seven years.
- CCB disciplinary actions against business in the pasts seven years.
| IMPORTANT: Homeowners lose the ability to recover damages through the bond and insurance as well as the CCB Dispute Resolution Service (DRS) if they use an unlicensed contractor. |
What kind of complaints will I see?
The CCB Dispute Resolution Services (DRS) helps consumers resolve disputes that arise from a construction project. The CCB tracks and makes information available on the following types of disputes and CCB disciplinary actions covering a seven year period:
- Disputes Not Yet Investigated. "Disputes Not Yet Investigated" are complaints filed with the CCB DRS against a contractor but not yet investigated, either by meeting with the parties at the jobsite or by requesting a response from the contractor.
- Disputes Pending. A "Pending Dispute" is an open dispute that is under investigation but not yet resolved. It is subject to further processing by the CCB before issuing a final order to either dismiss the dispute or award damages.
- Pending Proposed Dismissal. A "Pending Proposed Dismissal" is an open dispute that the CCB proposes to dismiss and a party has contested the CCB's decision by requesting a hearing or taking the matter to court.
- Disputes Voluntarily Settled. "Disputes Voluntarily Settled" are disputes that have been settled or resolved by the parties involved in the dispute.
- Disputes Dismissed by Agency. These are disputes that have been dismissed by the CCB and include those outside of the CCB's jurisdiction or are found in favor of the contractor.
- Disputes Resulting in Orders to Pay. The CCB has issued a final order that the contractor pay damages or civil penalties for CCB disciplinary actions.
- Disputes Closed by the CCB for Other Reasons. These are disputes the CCB has closed for reasons such as withdrawal or abandonment by the complainant.
Check on a Contractor's License
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| Best Practices for Hiring Contractors |
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- Check with the CCB, before asking for bids or entering into any agreements with a contractor. When checking a contractor’s license:
- Verify the contractor is actively licensed. This means the contractor can legally work in Oregon and has a surety bond and liability insurance, and assures you access to the CCB Dispute Resolution Process.
- Check the contractor’s history of complaints (disputes) and any other licenses associated with the contractor’s name.
- Get more than one bid from licensed contractors before making a decision.
- Don’t automatically accept the lowest bid. A higher bid may be worth the price in better materials or workmanship. If you get a very low bid, the contractor may have made a mistake or not bid everything. If the bid is too low to make a profit, they may use cheaper materials or take shortcuts.
- Ask for references. Check with previous customers. Were they satisfied with the work? Was the work completed on time? Did the contractor return phone calls? Learn as much as you can about the contractor you are hiring.
- Read “Building/ Remodeling Checklist” and “16 Ways to Avoid Remodeling, Repair and Construction Problems” for a more comprehensive list of issues to consider when hiring a contractor.
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| What does "bonded and insured" mean? |
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CCB Surety Bonds
“Bonded” means that the contractor has posted a surety bond with the Construction Contractors Board (CCB) as required by law.
A CCB surety bond provides a limited amount of financial security for property owners. Bonds can only be accessed in the event that the contractor is ordered by the CCB to pay damages as the result of a CCB final order, and the contractor fails to pay the order within 30 days. CCB surety bonds are very small compared to the volume of business performed by most construction businesses and are designed to provide an incentive for contractors to pay CCB orders, as opposed to being a comprehensive safety net for consumers.
CCB orders to pay damages may exceed the amount of the bond. Or, there may be more than one complaint subject to the contractor’s bond which may result in depletion of the bond before all disputes have been paid.
CCB statistics show that less than one half of one percent of licensed construction contractors fail to pay CCB orders each year. In other words, 99% of licensed Oregon construction contractors take care of their customers’ service issues and pay their construction debts.
CCB Required Liability Insurance
“Insured” means that the contractor has provided proof of general liability insurance to the CCB as required by law.
General liability insurance covers property damage and bodily injury losses caused by the contractor that occur as a result of the contractor’s work. Liability insurance will not normally pay the cost of removing, repairing or replacing bad work by the contractor. That’s what the surety bond is for.
Limitations on insurance contracts vary from insurer to insurer. Exclusions in a policy for specific exposures are common. Every policy is different, so it is important to understand the coverage a contractor has in place. You may wish to ask your prospective contractor to explain what its liability insurance does and does not cover.
For more information please read the Department of Consumer and Business Services fact sheet on liability insurance.
Summary
Together, bonds and liability insurance provide valuable protection for consumers. It is important to note, however, that these protections are limited and do not provide a comprehensive safety net for consumers. It is important for consumers to select licensed construction contractors that they know and can trust.
For information on how consumers can protect their interests when shopping for services provided by construction contractors, please read the Best Practices section of this page and the CCB publication 16 Ways to Avoid Remodeling, Repair and Construction Problems.
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| What should be in a contract? |
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One of the best ways to avoid construction disputes is negotiate and follow a well-written construction contract. Most construction disputes can be traced back to the parties’ failure to write, understand, and follow a well-written contract.
Well-written construction contracts often include the following provisions:
- Full name and CCB license number of the general contractor as it appears on the CCB web site. Click here to search for your contractor.
- Full name of the owner, the job address and contact information such as phone numbers.
- A detailed description of the scope of construction work
- List of specific building materials to be used in the project.
- Start and completion dates.
- Total price of the project, including labor and materials, and a payment schedule.
- List of allowance items (lighting, fixtures, plumbing fixtures, appliances, etc.) and the budgeted amount, if any.
- List of required permits, including who will be responsible for obtaining them.
- Agreement that any changes to the contract will only be done upon written “change orders” signed by both the contractor and the homeowner.
- Signature of both parties to the contract.
We recommend that you keep a signed copy of your contract, and all related materials in a safe place.
All consumer protection notices should be read, understood, and maintained with your contract documents.
Click here for a list and explanation of all residential consumer notices.
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| What is an arbitration clause? |
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Construction contracts often contain arbitration clauses. Arbitration is a form of alternative dispute resolution (ADR). It is a way to settle disputes outside, or instead of, a civil lawsuit.
Federal law supports and encourages arbitration as an alternative to civil lawsuits. Arbitration can be an effective, efficient way to resolve differences when parties to a contract have major disputes that they just cannot resolve on their own.
It is important that you understand the terms of all parts of your contract, and it is particularly important for you to fully understand and agree with the terms if an arbitration clause is in your contract. For example, you need to know:
- Who will be the arbitrator(s)?
- How do I know that the arbitrator will truly be neutral—not favor one side or the other?
- What will the arbitration cost be?
- What rules will be used if the parties must arbitrate their dispute?
Arbitration clauses are a little bit like a pre-nuptial agreement in a marriage. It spells out how the parties will resolve their differences in the event things don’t work out.
Arbitration clauses can prevent consumers from using the CCB Dispute Resolution Services to help resolve disputes they may have with their contractor. So be sure you understand and agree with the terms of any arbitration clause before you sign any construction contract.
Because your construction contract may represent the single biggest purchase you and your family may ever make, you may wish to have your own lawyer review the terms of your construction contract before you sign the contract.
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| What is a construction lien? |
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A construction lien is a claim upon property for money owed to a contractor, material supplier or anyone who supplied labor or materials for improvements to the property.
If your contractor isn’t paid, or if your contractor does not pay subcontractors, employees, rental equipment or material suppliers, or others who are owed money for work on your property, they may lien your property for payment.
It is in your best interest to verify that all bills are paid, even if you pay your contractor in full.
Information Notice to Owner About Construction Liens can help you understand the lien process and steps you can take to protect yourself.
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| What should I do if I have a problem with a contractor? |
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The first thing to do is: don’t panic. The chances are your contractor wants you to be a satisfied customer as much as you want the job done to your satisfaction.
Talk to the contractor about the problem and try to reach an agreement. If there are multiple issues, you may want to make a list of your complaints and meet with the contractor as soon as possible to address your concerns. Request that the contractor respond to you about the complaint(s) within a reasonable time. Be aware, however, of the time limits for filing a CCB Dispute Resolution Services (DRS) complaint.
You may wish to consult with an attorney of your choice. In many instances, it pays to invest a few hundred dollars with an attorney to obtain proper legal advice.
CCB Contract Dispute Resolution Services (DRS)
- CCB DRS complaints must be filed within strict time limitations. Click here for more information.
- REMEMBER: CCB DRS can only help if the contractor was actively licensed during your construction project. If the contractor was unlicensed, the CCB Enforcement section may be able to assess civil penalties and encourage the contractor to address the problems and concerns you have.
- Click here to download the complaint form, or call the CCB Customer Service Unit at 503-378-4621 to obtain the form by mail. This publication gives you the information needed to begin the Dispute Resolution Process.
- Before filing a CCB DRS complaint, you are required to send a notice to your contractor of your intent to file a CCB DRS complaint. Click here to use the CCB online Letter of Intent form.
If you write your own letter to the contractor, make sure it includes the date, the contractor’s name, address that is on file with the CCB, the statement that you intend on filing a complaint with the CCB and your signature. You may also include additional information, such as a list of defects you allege. The letter must be sent by certified mail. The CCB will require copies of the notice and the USPS certified mail receipt when processing the complaint.
For more information on the CCB Dispute Resolution Services (DRS) click here.
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| Top Five Consumer Mistakes |
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A successful building or remodeling project requires careful planning and attention to detail. Below are the top five mistakes made in a construction project:
- Automatically accepting the lowest bid.
The old saying “you get what you pay for” generally applies here. A higher bid may be worth the price in better materials, workmanship and reliability.
- No written contract.
A written contract protects you and the contractor. It is required that all construction agreements be committed to a written contract if the price exceeds $2000. The CCB recommends that all agreements, including all changes to the contract, be in writing.
- Not checking the contractor’s license.
A license is required for any construction business that advertises, offers, bids, arranges for, or performs any construction, alteration, home improvement, remodeling or repair work.
| IMPORTANT: Homeowners lose the ability to recover damages through the bond and insurance as well as the CCB Dispute Resolution Service (DRS) if they use an unlicensed contractor. |
4. Not checking references.
Check with previous customers. Were they satisfied with the work? Was the work
finished within a reasonable time frame? Did the contractor return phone calls? If the
person had problems with the contractor, ask how the contractor responded to complaints.
Look at examples of the contractor’s work.
5. Not doing the homework.
Plan your project carefully. Consider your budget. Find pictures of styles and products
you like. Write down brand names and models. Show them to your contractor. “High
quality faucets” or “ivory paint” may mean something different to you and your contractor.
Walk with your builder through a finished project and explain what you like and don’t like.
Get accurate plans or blueprints and make sure they show your project accurately.
For more tips on a successful construction project read Building/Remodeling Checklist and 16 Ways to Avoid Remodeling, Repair and Construction Problems.
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| Other Consumer Protection Websites |
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The Construction Contractors Board (CCB) highly recommends verifying a contractor’s license with the CCB. Consumers may wish to visit the following websites that offer additional consumer help and information.
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| Consumer Publications |
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The CCB offers a variety of educational brochures to help you through the building, remodeling and dispute resolution process. Click here to see a list of publications available for download or click here to use the CCB's order form.
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| What is workers' compensation coverage? |
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Worker compensation is a type of insurance carried by businesses that is designed to protect employees if they are injured while on the job.
Click here to search the DCBS Worker's Compensation database.
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| Consumer Education Events Schedule |
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Every year the CCB participates in home shows and neighborhood meetings throughout the state. Click here to see a list of our scheduled consumer education opportunities.
If you are interested in scheduling a speaker from our Education Department for an event for your group or organization, please click here to email your request to the CCB.
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