Summary
finding that even though "the statute prevents an unlicensed contractor from suing to collect on the contract . . . the statute nowhere prohibits an unlicensed contractor from defending a breach of contract suit on its merits."
Summary of this case from Guam Tai-Pan Dev. & Constr., Inc. v. Yigo Alta Estates, IncOpinion
Docket No. 58196.
Decided January 25, 1983.
McLean Mijak (by Edward J. Mijak), for plaintiff. Kistner, Schienke, Staugaard Dettloff, P.C. (by Gary R. Dettloff), for defendant.
Before: CYNAR, P.J., and N.J. KAUFMAN and MacKENZIE, JJ.
The defendant appeals from a summary judgment granted by the 41A District Court and affirmed by the Macomb County Circuit Court. The plaintiff, Anne C. Parker, sued the defendant, McQuade Plumbing Heating, Inc., for breach of contract for improper installation of a boiler. The defendant company was not a licensed plumbing contractor, but the principal operator of the company, Arthur McQuade, was a licensed master plumber. Mr. McQuade is not a party to this suit. The plaintiff moved during trial for summary judgment, arguing that she was entitled to relief as a matter of law because the defendant was unlicensed. The trial court agreed that MCL 338.1516; MSA 18.86(116) applied and granted judgment for the plaintiff.
We disagree that the statute entitled the plaintiff to summary judgment. That section stated:
That section was repealed by 1980 PA 299, § 2601, effective October 21, 1980. It was replaced by MCL 339.2412; MSA 18.425(2412).
"No person engaged in the business or acting in the capacity of a residential builder and/or residential maintenance and alteration contractor may bring or maintain any action in any court of this state for the collection of compensation for the performance of any act or contract for which a license is required by this act without alleging and proving that he was duly licensed under this act at all times during the performance of such act or contract: Provided, however, That nothing herein contained shall be construed to defeat the right of a mechanic's lien on the part of any person who in good faith sells materials or performs labor for such residential builder and/or residential maintenance and alteration contractor."
By its terms the statute prevents an unlicensed contractor from suing to collect on the contract. Chilson v Clevenger, 12 Mich. App. 56; 162 N.W.2d 303 (1968). An unlicensed contractor also cannot collect on a counterclaim, although equitable principles may demand an offset for the value of services rendered by the contractor. Kirkendall v Heckinger, 403 Mich. 371; 269 N.W.2d 184 (1978). But the statute nowhere prohibits an unlicensed contractor from defending a breach of contract suit on its merits. The statute removes an unlicensed contractor's power to sue, not the power to defend. It was intended to protect the public as a shield, not a sword.
Reversed.