Drawing on cases our firm has handled, here are the three complaint types we see most often against licensed general contractors in North Carolina — why they matter, the laws that come into play, and practical steps you can take to avoid trouble.
What a licensing complaint typically looks like
When a complaint is filed with the North Carolina Licensing Board for General Contractors, you’ll usually receive a “Notice of the Filing of a Complaint Against a Licensee” that includes an affidavit or summary of charges. Those summaries can be brief or very detailed (especially when a homeowner files and attaches long narratives).
Common statutes and rules that show up on notices include N.C. Gen. Stat. § 87-11 (the general contractor statute covering fraud, deceit, incompetency, misconduct, etc.) and various administrative code provisions under the Board’s rules (e.g., 21 NCAC 12A). Often the Board will rely on broad language in § 87-11 and the administrative code to enforce compliance.
Top 3 complaints we see — explained and how to avoid them
1. Renting (or “running”) your GC license to an unlicensed person
What this looks like:
- An unlicensed subcontractor or individual performs work but the permit or contract is under the licensed GC’s name.
- A subcontractor pulls a permit under the GC’s license or the unlicensed person’s company pulls the permit under the licensed entity.
- Permitting departments often spot this and are frequent complainants to the Board.
Why it’s a problem
The Board considers allowing an unlicensed person or entity to use a license where one is required as misconduct. It can lead to severe discipline, including suspension. The Board commonly enforces violations under N.C. Gen. Stat. § 87-11 and interprets misconduct through its administrative rules (see 21 NCAC 12A .0201(3), which refers back to § 87-11).
How to avoid it
- Pull permits yourself — make sure all building permits are in the licensed entity’s name and are obtained by you or your authorized staff.
- Maintain clear financial trails — draws and payments should flow through your company account. Keep invoices from your business, then pay subcontractors from your company account and keep receipts.
- Supervise the job — you don’t need to be on site every hour, but you must be actively supervising: be available, visit regularly (weekly is a good rule of thumb), and know the status of the work.
- Use construction management software to track jobs, documents, invoices, draws, and communication.
2. Not pulling required permits
What this looks like:
- Work begins without required building permits from the state, county, or city.
- Contractors assume permit requirements are the same everywhere — but local jurisdictions often have different or changing rules.
Why it’s a problem
North Carolina’s state building code (for example, provisions found in N.C. Gen. Stat. ch. 160D and local ordinance authority) requires permits for many types of work. Even though the Board enforces licensing rules under Chapter 87, the Board can discipline a licensee for conduct that violates building code or local permit laws by treating that conduct as misconduct under § 87-11.
How to avoid it
- Always verify permit requirements before starting work. Check both state rules and the specific county or city requirements where the job is located.
- If you’re working in an unfamiliar county or municipality, contact the local building department, review their procedures, and confirm what needs a permit.
- Stay current — permit rules and codes can change. Don’t assume what worked 12 months ago still applies.
3. Failing to include your license number on contracts and bids
What this looks like:
Contracts or bids that do not display the contractor’s license number.
Why it’s a problem
Under the Board’s administrative rules (see 21 NCAC 12A .0501(a)), a license number must be included on all contracts and bids. Omitting the number is a common compliance issue and a frequent basis for complaints.
How to avoid it
- Include your license number on every written contract and every bid you submit.
- Keep templates updated so the license number is automatically included on proposals, estimates, and contracts.
Practical compliance checklist
- Pull permits personally or ensure they’re pulled under your licensed entity.
- Keep all job-related income and payments flowing through your business account; retain invoices and receipts.
- Include your license number on every contract and bid (21 NCAC 12A .0501(a)).
- Supervise jobs regularly, be available to clients and inspectors, and document site visits.
- Develop good recordkeeping and use construction management tools to track draws, payments, permits, and communications.
- Know the local building department rules for each jurisdiction you work in; rules can change.
If you receive a complaint — recommended next steps
Do not ignore a Notice of Complaint. Typical first actions include:
- Read the notice and affidavit carefully — identify the statutes and administrative rules cited (commonly N.C. Gen. Stat. § 87-11 and related 21 NCAC rules).
- Preserve all job files, contracts, permits, invoices, bank records, correspondence, and photos.
- Contact counsel experienced with general contractor licensing and disciplinary defense — the Board process can be technical and procedural.
- Respond in a timely manner; missed deadlines or silence can make the situation worse.
Final thoughts
Most complaints can be prevented with disciplined recordkeeping, attentive supervision, proper permitting, and simple contract hygiene (like putting your license number on bids). Stay proactive, know the local rules where you work, and keep clear financial trails. Thank you for the work you do — if you need assistance, reach out and we’ll help you get back to business.
*Nothing in this blog establishes an attorney-client relationship. Nothing in this blog is legal advice. If you have any questions, please check out our other blogs and our Youtube channel. You can also call us at 919-521-8810 with questions.
