Illinois Appellate Court Reports
MD ELECTRICAL CONTRACTORS v. ABRAMS, 2-06-0135 (Ill.App.
11-27-06) MD ELECTRICAL CONTRACTORS, INC.,
Plaintiff-Appellant, v. FRED ABRAMS and CAROL ABRAMS,
Defendants-Appellees. No. 2-06-0135. Appellate Court of
Illinois, Second District. November 27, 2006.
Appeal from the Circuit Court of Du Page County, No.
05-AR-1433, Honorable Kenneth A. Abraham, Judge, Presiding.
Justice HUTCHINSON delivered the opinion of the court.
Plaintiff, MD Electrical Contractors, Inc., sued
defendants, Fred and Carol Abrams, in quantum meruit to
recover for improvements that it made as a subcontractor on
a home improvement project. Defendants moved to dismiss the
complaint (see 735 ILCS 5/2-619(a)(9) (West 2004)),
contending that, because plaintiff had violated the Home
Repair and Remodeling Act (Act) (815 ILCS 513/1 et seq.
(West 2004)), it could not recover. The trial court granted
the motion. On appeal, plaintiff contends that (1) the Act
does not apply to plaintiff as a subcontractor, and (2)
even if the Act does apply, it does not preclude plaintiff
from recovering in quantum meruit. We agree with
plaintiff’s first contention, and we reverse and remand.
Plaintiff’s first amended complaint alleged that, between
about June 6, 2004, and October 1, 2004, plaintiff
furnished subcontracting services, including electrical
equipment and labor, toward the remodeling of defendants’
house; that there was no contract between plaintiff and
defendants; and that plaintiff was entitled to $14,984 for
the services and materials that it provided. Defendants
moved to dismiss the first amended complaint, alleging that
plaintiff had violated the Act and thus could recover
nothing. Defendants relied on the following sections of the
Act:
“Sec. 10. Definitions. As used in this Act:
‘Home repair and remodeling’ means the fixing, replacing,
altering, converting, modernizing, improving, or making of
an addition to any real property primarily designed or
used as a residence other than maintenance, service, or
repairs under $500. ‘Home repair and remodeling’ includes
the construction, installation, replacement, or
improvement of electrical wiring within the
residence or upon the land adjacent to the residence.
‘Person’ means any individual, partnership, corporation,
business, trust, or other legal entity.
‘Residence’ means a single-family home or dwelling.”
815 ILCS 513/10 (West 2004).
“Sec. 15. Written contract; costs enumerated. Prior
to initiating home repair or remodeling work for over
$1,000, a person engaged in the business of home repair or
remodeling shall furnish to the customer for signature a
written contract or work order that states the total
cost, including parts and materials listed with reasonable
particularity and any charge for an estimate. In addition,
the contract shall state the business name and address of
the person engaged in the business of home repair or
remodeling.” 815 ILCS 513/15 (West 2004).
“Sec. 20. Consumer rights brochure. (a) For any
contract over $1,000, any person engaging in the business
of home repair and remodeling shall provide to its
customers a copy of the ‘Home Repair: Know Your Consumer
Rights’ pamphlet prior to the execution of any home repair
and remodeling contract. The consumer shall sign and
date an acknowledgment form entitled ‘Consumer Rights
Acknowledgment Form’ that states: ‘I, the homeowner, have
received from the contractor a copy of the pamphlet
entitled “Home Repair: Know Your Consumer Rights.”‘ The
contractor or his or her representative shall also sign
and date the acknowledgment form.” 815 ILCS 513/20 (West
2004).
“Sec. 30. Unlawful acts. It is unlawful for any
person engaged in the business of home repairs and
remodeling to remodel or make repairs or charge for
remodeling or repair work before obtaining a signed
contract or work order over $1,000. This conduct is
unlawful but is not exclusive nor meant to limit other
kinds of methods, acts, or practices that may be unfair
or deceptive.” 815 ILCS 513/30 (West 2004).
Defendants alleged that the electrical work that plaintiff
provided was “home repair and remodeling” (815 ILCS 513/10
(West 2004)) and that plaintiff violated the Act by (1)
failing to furnish a proper written contract; and (2)
failing to provide them a copy of the consumers’ rights
brochure or an acknowledgment form. Defendants contended
that section 30 of the Act barred plaintiff from
recovering.
Plaintiff responded that the Act applies to contractors,
but not to subcontractors. Plaintiff contended that the
legislature could not have intended to require that a
homeowner sign a separate contract with the general
contractor and every subcontractor. Here, plaintiff stated,
defendants had signed a contract with Apex Builders, Inc.
(Apex), the general contractor, which was answerable to
defendants for the quality of the work on the project.
Plaintiff contended that defendants ought not retain the
benefit of plaintiff’s work without paying for it.
In reply, defendants contended that the Act applies
unambiguously to any “person engaged in the business of
home repair or remodeling” (815 ILCS 513/15 (West 2004))
and that the requirement of a written contract for repairs
costing more than $1,000 applies unambiguously to “any
person engaged in the business of home repairs and
remodeling” (815 ILCS 513/30 (West 2004)). Defendants
alleged that Apex had provided neither a written contract
nor a consumers’ rights brochure and that the obligation to
do so devolved onto the subcontractors, including
plaintiff.
The trial court dismissed the first amended complaint. The
court held that the Act applied to plaintiff even though it
had been a subcontractor, not the general contractor, on
the project and that, because plaintiff had violated the
Act, it could not recover in quantum meruit. Plaintiff
timely appeals, contending that (1) the Act does not apply
to subcontractors; and (2) even if the Act does apply to
subcontractors, plaintiff is entitled to recover in quantum
meruit against defendants. Because we agree with
plaintiff’s first contention of error, we reverse the
dismissal of the first amended complaint without reaching
the second contention.
Whether the Act applies to subcontractors is a question of
statutory construction and thus an issue of law that we
review de novo. See In re Estate of Dierkes, 191 Ill. 2d
326, 330 (2000). Our goal is to ascertain and effectuate
the intent of the legislature. People v. Wooddell, 219 Ill.
2d 166, 170 (2006). Ordinarily, the statutory language is
the best evidence of legislative intent. People v.
Maggette, 195 Ill. 2d 336, 348 (2001). Generally, if the
language is unambiguous, we must apply it
straightforwardly. Woodell, 219 Ill. 2d at 171. If the
language is ambiguous, i.e., susceptible to more than one
reasonable interpretation (see Reda v. Advocate Health
Care, 199 Ill. 2d 47, 55 (2002)), then we presume that the
legislature did not intend to create absurdity,
inconvenience, or injustice, and we must choose a
reasonable interpretation over one that leads to absurd,
inconvenient, or unjust consequences (In re Application of
County Collector of Du Page County for Judgment for Taxes
for Year 1993, 187 Ill. 2d 326, 332 (1999)). We turn to the
pertinent sections of the Act.
Section 10 of the Act defines a “person” as “any
individual, partnership, corporation, business, trust, or
other legal entity.” 815 ILCS 513/10 (West 2004). Section
10 defines “[h]ome repair and remodeling” as the “fixing,
modernizing [or] improving” of real property,
including “the construction, installation,
replacement, or improvement of electrical wiring” within
the residence. 815 ILCS 513/10 (West 2004). Here, plaintiff
was a “legal entity” of some sort, and it installed wiring,
lighting, and other electrical equipment in defendants’
home. Therefore, defendants contend that, under the
statute’s plain language, plaintiff was subject to the
provisions of the Act. See Central Illinois Electrical
Services, L.L.C., v. Slepian, 358 Ill. App. 3d 545, 549
(2005) (electrical contractor performed “remodeling” as
defined by Act).
Plaintiff counters in part that the language of the Act is
not as straightforward as it appears. According to
plaintiff, the particular language and the Act’s
substantive requirements demonstrate that the legislature
wished to regulate only contractors, because normally only
they are in privity with homeowners or initiate business
relationships with homeowners. Plaintiff observes as
follows.
Section 5 of the Act states in part, “The General Assembly
recognizes that improved communications and accurate
representations between persons engaged in the business of
making home repairs or remodeling and their consumers will
increase consumer confidence, reduce the likelihood of
disputes, and promote fair and honest practices in that
business in this State.” (Emphasis added.) 815 ILCS 513/5
(West 2004). The consumers’ rights brochure required under
section 20(c) of the Act lists “warning signs of potential
scam” that include “[d]oor-to-door salespersons with no
local connections” who offer work at prices far below
market; “[s]olicitations from a company that lists only
a telephone number or post-office box number to contact”;
“[c]ontractors who fail to provide customers references when
requested”; “[p]ersons offering to inspect your home for
free”; “[c]ontractors demanding cash payment for a job or
who ask you to make a check payable to a person other than
the owner or company name”; and “[o]ffers from a contractor
to drive you to the bank to withdraw funds to pay for the
work.” (Emphasis added.) 815 ILCS 513/20(c) (West 2004).
Plaintiff argues that the quoted language focuses entirely
on the “communications” and “representations” (815 ILCS
513/5 (West 2004)) that occur routinely between general
contractors and prospective customers. Plaintiff reasons
that by deliberately using the term “contractors” and
omitting the term “subcontractors,” and by focusing
exclusively on the types of interactions that only
contractors customarily have with homeowners, the
legislature showed its intent to regulate only how general
contractors obtain customers and sometimes may exploit
those customers.
Plaintiff also contends that to apply the Act to
subcontractors would produce absurd consequences that would
actually disadvantage homeowners and, thus, could not have
been intended by the legislature. Plaintiff reasons that
requiring every subcontractor on a project to sign a
contract with the homeowner would force the homeowner to
become his or her own general contractor and negotiate
numerous separate agreements and would also render the
general contractor superfluous.
We find plaintiff’s arguments compelling. We conclude first
that the crucial statutory language, even considered apart
from its practical consequences, does not demonstrate
unambiguously that the legislature intended that the Act
apply to subcontractors. Aside from the contrary indicia of
legislative intent that plaintiff has identified, there are
further signs that the Act was meant to apply only to
general contractors. The extent of a party’s obligations
under the Act depends on the overall cost to the consumer,
not on the specific cost of a particular aspect of the
work. Section 15 requires that there be a written contract
or work order before the initiation of “home repair or
remodeling work for over $1,000” (815 ILCS 513/15 (West
2004)), and a signed form acknowledging the delivery of a
consumers’ rights brochure is required only when there is a
“contract over $1,000” (815 ILCS 513/20(a) (West 2004)).
The consumers’ rights brochure states that among the basic
terms to be included in a contract are the “[s]tarting and
estimated completion dates” and the “[t]otal cost of work to
be performed.” 815 ILCS 513/20(c) (West 2004). Both of
these phrases appear to refer to the project as a whole,
not the particular task of a subcontractor. Also, the
warnings provided by the brochure focus not only on
potentially abusive practices by those directly soliciting
homeowners to enter into contracts, but also on the rights
of the consumer vis-a-vis the general contractor. The
warnings repeatedly refer to “the contractor.” 815 ILCS
513/20(c) (West 2004). Such phraseology strongly suggests
that the legislature was concerned about protecting
consumers by regulating the conduct of those with whom the
consumers deal with directly before entering into
contracts.
A review of the Act’s legislative history further supports
plaintiff’s argument that the legislature’s purpose in
enacting the statute was to protect homeowners from the
fraudulent practices of those contractors who directly
solicit offers of home repair and improvement services.
During the floor debate on the legislation, Representative
Fritchey stated that the purpose of the Act was to
“prevent the fly by night people, the people that
come and prey on seniors, that come and prey on homeowners
after disasters, after tragedies whose homes are in need of
repair.” 91st Gen. Assem., House Proceedings, May 20, 1999,
at 17 (statements of Representative Fritchey).
Representative Winters, a sponsor of the legislation, also
noted that, “Over the last five years, [the Attorney
General] average[s] almost 500 complaints from consumers a
year being ripped off by [con] artists who simply go up and
down the street looking for the elderly, looking for the
unprotected, looking for the uninformed. This Bill seeks to
inform the consumer, it is not onerous to the contractors,
a simple brochure and contract language is all it
requires.” 91st Gen. Assem., House Proceedings, May 20,
1999, at 20 (statements of Representative Winters). These
statements, and others appearing in the transcripts of the
debate, demonstrate that the purpose of the
written-contract provision of the Act was to provide
homeowners with information regarding the work to be
performed and the contractor who was ultimately responsible
for the work. See 91st Gen. Assem., House Proceedings, May
20, 1999, at 12 (statements of Representative Black)
(noting that the Act imposed additional requirements upon
“general contractors”); 91st Gen. Assem., House
Proceedings, May 20, 1999, at 19-20 (statements of
Representative Scott) (noting that written-contract
requirement of Act would provide law enforcement an
opportunity to find fraudulent home improvement contractors
before they had an opportunity to commit additional acts of
fraud).
For all of these reasons, we reject defendants’ and the
trial court’s conclusion that the Act unambiguously applies
to subcontractors as well as contractors. Furthermore, we
conclude that a construction that requires subcontractors
to comply with the Act should be rejected as unreasonable
and likely to lead to consequences that the legislature
could not have intended. We agree with plaintiff that it is
simply not realistic to ask the homeowner, who has already
hired the general contractor to manage the project, to
negotiate a separate contract with each subcontractor. That
would indeed severely burden the homeowner (the Act’s
intended beneficiary) and perhaps also render the position
of general contractor superfluous. We believe that, had the
legislature intended such curious results, it would have
said so unmistakably. Extending the Act’s written-contract
requirement to potentially numerous subcontractors would
actually saddle the homeowner with far more
responsibilities.
Slepian is the only reported Illinois case applying the
provisions of the Act. That case, however, did not address
the question of whether the Act applies to subcontractors
as well as general contractors. In Slepian, an electrical
contractor entered into a oral contract with homeowners to
provide electrical services over a two-year period as part
of a home remodeling project. Slepian, 358 Ill. App. 3d at
547-48. After the homeowners failed to pay the final
invoice, the electrical contractor sued to foreclose upon
the mechanic’s lien it had recorded. Slepian, 358 Ill. App.
3d at 547. As an affirmative defense to the suit, the
homeowners alleged that the contractor had violated the Act
by failing to provide a written contract and that the
contractor was precluded under section 30 of the Act from
recovering on its mechanic’s lien. Slepian, 358 Ill. App.
3d at 547. The reviewing court reversed the trial court’s
judgment in favor of the contractor on its mechanic’s lien,
finding that the contractor had violated the Act by failing
to provide the homeowners with a written contract.
Slepian, 358 Ill. App. 3d at 550 (holding that the
“language of the Act clearly and unambiguously requires
anyone engaged in the business of home repair and
remodeling to obtain a signed contract before initiating
work that will exceed $1,000 in cost”). In Slepian, the
electrical contractor did not contend that it was a
subcontractor, and the reviewing court did not address the
question of whether the Act’s provisions apply to
subcontractors. The dissenting opinion in Slepian suggested
that the electrical contractor did not fall into the
“category of contractors from whom the legislature was
seeking to protect consumers,” because it “did not employ
door-to-door salesmen using high-pressure tactics.”
Slepian, 358 Ill. App. 3d at 554 (Barry, J, dissenting).
We note that courts in two other jurisdictions have held
that substantially similar laws do not apply to
subcontractors. In O’Donnell v. Rindfleisch, 13 Conn. App.
194, 535 A.2d 824 (1988), the homeowners contended that
they did not need to pay the contractor for work that a
subcontractor did on their chimney. The homeowners relied
on a state statute that imposed registration requirements
on “contractors” who performed “home improvement.”
O’Donnell, 13 Conn. App. at 199-200, 535 A.2d at 826-27.
The statute defined “contractor” and “home repair” in broad
terms similar to those that the Act uses to define “person”
and “home repair or remodeling,” and it forbade anyone from
“hold[ing] himself out to be a contractor or salesman”
without first obtaining an official certificate of
registration. O’Donnell, 13 Conn. App. at 200-01, 535 A.2d
at 827, quoting Conn. Gen. Stat. §§ 20-419(3),
(4), 20-420(a) (___).
Despite the apparent breadth of the pertinent language, the
court of review held that the statute’s registration
requirement did not apply to the chimney subcontractor. The
court relied in part on legislative history, but it
concluded first that the language itself compelled its
holding. The court noted specifically that the registration
provision mentioned “contractors” but not “subcontractors,”
even though it also specifically required “salesmen” to
register with the state. O’Donnell, 13 Conn. App. at 201,
535 A.2d at 827. Furthermore, the court observed that it
would not be reasonable to apply the registration provision
to subcontractors on a home repair project:
“We agree with the trial court that requiring
subcontractors to register as home improvement contractors
would be unreasonable and unduly burdensome in an industry
where most, if not all, construction work is subcontracted for its
completion by a general contractor who oversees the entire
project and is responsible for the final result.” O’Donnell,
13 Conn. App. at 204, 535 A.2d at 828.
In Meadows v. Higgins, 249 Conn. 155, 733 A.2d 172 (1999),
the Connecticut Supreme Court adopted the reasoning of
O’Donnell and held that the statute did not apply to
subcontractors on home-repair projects. The court explained
that the “target” of the act was “the contractor who ha[s]
dealt directly with the homeowner and who ha[s] been the
party ultimately responsible for the subcontractor.”
Meadows, 249 Conn. at 167, 733 A.2d at 178.
In Messeka Sheet Metal Co. v. Hodder, 368 N.J. Super. 116,
845 A.2d 646 (2004), a subcontractor on a substantial
home-renovation project sought to recover against the
homeowners for the sale and installation of an
air-conditioning system. The homeowners contended that they
were excused from payment because the subcontractor had not
obtained the permits required by the state’s consumer fraud
statute and had violated the statute in other respects. The
statute used terminology similar to that employed in the
Act. It defined a “seller” as “‘a person engaged in the
business of making or selling home improvements,
[including] corporations, partnerships, associations and
any other form of business organization or entity, and
their officers [and] representatives.'” Hodder, 368 N.J.
Super at 125, 845 A.2d at 652, quoting N.J. Admin. Code
tit. 45A, § 16.2 (___). Among other things, the law
prohibited a “seller contracting for the making of home
improvements” from starting work before obtaining all of
the required state and local permits, and it required a
seller to furnish the homeowner with written copies of all
guarantees and warranties. Hodder, 368 N.J. Super. at 132,
845 A.2d at 657, quoting N.J. Admin. Code tit. 13:45A,
§§ 16.2(a), (a)(10.i), (a)(11.i) (___).
Despite this seemingly comprehensive language, the court
held that the plaintiff was not subject to the statute. The
court explained that the plaintiff was not “a traditional
‘seller’ within the [statute],” because the law was
“designed to protect homeowners who deal directly with
contractors.” Hodder, 368 N.J. Super. at 124-25, 845 A.2d at
652. Furthermore, the court quoted approvingly the
O’Donnell court’s statement that applying a statute such as
those at issue in the Connecticut and New Jersey cases
would unduly burden subcontractors and homeowners. Hodder,
368 N.J. Super. at 127, 845 A.2d at 654; see O’Donnell, 13
Conn. App. at 204, 535 A.2d at 828. We believe that the
reasoning of the Connecticut and New Jersey courts is both
highly persuasive and fully applicable here.
For the foregoing reasons, we hold that the trial court
erred in applying the Act to plaintiff. Therefore, we do
not decide whether, if the Act applied, plaintiff could
recover in quantum meruit.
The judgment of the circuit court of Du Page County is
reversed, and the cause is remanded.
Reversed and remanded.