Professional License Lawyer in North Carolina

News Story about General Contractor and Fraudulent Notarization

News Story about General Contractor and Fraudulent Notarization

Today, I want to do something a little bit different. I want to discuss a WRAL story from February 20th, 2024, about an unlicensed general contractor and a property owner who wanted to have renovations done on her property.
There is what is called an Owner Exemption Affidavit. If an owner of a house, a homeowner, wants to do renovations on their property or additions to the property, they can pull the permit themselves. Not a problem. But one of the requirements nowadays, due to shenanigans with some folks regarding having the permit pulled by the homeowner and then the person that’s doing the work is actually an unlicensed general contractor. Because of things like that, there’s a requirement that the owner of the property complete an Owner Exemption Affidavit.
In this WRAL story back on February 20th, what happened was the homeowner signed the Owner Exemption Affidavit. The affidavit itself was presented by the unlicensed general contractor. It was already notarized, and then the homeowner signed it, even though the notary had already notarized it and never saw her actually sign it. As a notary myself, I can attest that this is a huge no-no. It constitutes notary fraud, and both the unlicensed general contractor and the notary would be in trouble for conspiracy, as well as potentially as principals.
So you definitely want to be very careful as a homeowner, and if you are a general contractor, unlicensed or otherwise, make sure that you pull the permits. If you’re unlicensed, make sure that you don’t agree to any job that is $40,000 and above. If you are a licensed general contractor, make sure that you pull the permits on any job. Make sure you have a really good contract with the homeowner or change orders with the homeowner because people change their minds. And you also want to make sure, I think this is one of the bigger things that a lot of general contractors don’t really or might not completely understand and might not do, but the money comes from the homeowner, and it goes through you. That’s what you used to pay for the materials. That’s what’s paid for your subcontractors. Some homeowners might try to cut corners, say, “Oh, well. I’ll just pay them myself, etc.” Don’t let them do that. All the money comes through you. It’s your license. At the end of the day, you want to make sure you’re protected. You want to make sure that you do things the right way. You might have the best of intentions to say, “Hey, I’m just trying to help John and Jane Smith save a couple bucks and I’m still going to be on the job and doing this, that and the other.” And then meanwhile, John and Jane Smith are paying all the subcontractors. You have no idea that when they’re coming by and the NC Licensing Board for General Contractors gets involved and it makes you look way worse than what you’ve actually done.
So don’t let people do that. It’s your license, it’s your responsibility, it’s your job. Money comes from the homeowner for whatever project you’re working on. That money is used, goes through your operating account, and goes for materials; it goes to your subcontractors, and that’s your responsibility. Because at the end of the day, if you do it a different way, the Board’s going to come calling, and that’s going to be a big no-no with them. They’ve really frowned upon that. They look at that as you are running your license to them, even though in actuality, you have the best of intentions trying to save them some money. But per statute and code, that’s how it’s looked at with the Board.
So I tell you about that February 20th WRAL story just to get on my soapbox a little bit and kind of explain how things can look to the NC Licensing Board for General Contractors and that they may look to other legal entities and authorities. So make sure you do things by the book in the right way, because at the end of the day, it’s your license and you want to make sure that you’re protected.

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