How to Sue a Contractor in California Small Claims

One of the most commonly filed cases in California small claims that I see are lawsuits against contractors. Although the process may seem complicated, this article breaks it down into easy steps.

Did you know we have a free tool powered by AI that helps you write a demand letter to a contractor? This is usually the first step most people take before suing. Check out our demand letter tool.

* Court filing fees and serving costs are $0 when you qualify for a court fee waiver.

We outline each step with further details in the sections below:

1. Communicate directly with the contractor, both formally and informally. This will help you meet the "demand payment" requirement for California small claims lawsuits.

2. Consider filing a complaint with the California Contractors State License Board (CSLB).

3. Consider filing a claim with the contractor's surety company.

4. Prepare and file the lawsuit.

5. Notify ("serve") the contractor you have sued.

6. Prepare for and attend the small claims hearing.

We can help you prepare, file, and serve your small claims lawsuit against your contractor. Start Lawsuit.

Before considering suing, you should try to resolve the problem amicably. If your attempts to resolve the problem with the contractor by calling or texting them don't work, you may need to formalize your communications by sending a letter.

In California small claims, you are required to "demand payment" before suing. While you are not required to send a formal letter to meet the demand payment requirement, you should consider writing a formal letter known as a demand letter.

By writing a formal demand letter:

• The contractor will know you are serious about the problem and may agree to resolve the problem before you file a small claims lawsuit.

• You will have the letter as evidence that you actually met the demand payment requirement before suing and can show the letter to the judge at the hearing if the contractor argues that you didn't demand payment before suing.

Did you know we have a free tool powered by AI that helps you write a demand letter to your contractor? This is usually the first step most people take before suing. Check out our demand letter tool.

Here is a video on how our demand letter tool works:

The Contractors State Licensing Board (CSLB) is a California government agency that regulates contractors.

The Contractor's Licensing Board:

• Issues licenses.

• Investigates consumer complaints.

• Enforces the rules that contractors have to follow.

To look up a contractor's license, search the California Contractors State License Board database. You can file a complaint if the contractor is licensed or unlicensed.

Once you file a complaint, the California Contractors State Licensing Board will investigate your complaint against the contractor. The CSLB does not have the authority to force an unlicensed contractor to pay you back, but it does have the authority to fine the contractor or refer the complaint to the district attorney's office.  

Further Reading: Step-by-Step Guide on How to File a Complaint with the California Contractors State Licensing Board

In California, licensed contractors are required to purchase a bond or surety. A bond or surety is like an “insurance policy” so that if the contractor does something covered by the "policy" they have with the surety company, the surety company is responsible for paying damages directly to you, the consumer.

Here are the steps to filing a claim with a contractor's surety company:

1. Check if the contractor is licensed with the California Contractor’s State Licensing Board. If the contractor is licensed, their surety company information and surety amount will also be listed on their profile.

2. Ask the contractor for a copy of their surety company contract. Contractors are typically required to provide this information. If the contractor is uncooperative in providing you with their surety contract, you can contact the surety company directly and request a copy. Having access to the surety contract is nice but not necessary, as it gives you more information. Read the surety contract terms. The surety contract might have specific rules on what the policy covers and how you can get paid.

3. Contact the surety company and ask what the steps are for submitting a claim. One of the most common surety companies in California is CNA Surety. Its website has a claim page.

Here’s what you need to know about filing a claim with a surety company:

• Who Can File a Claim: In general, homeowners, anyone harmed by a willful violation of a construction contract, employees who weren’t paid, or trust funds damaged by unpaid fringe benefits can file claims. The surety company will investigate any claim made against a bond.  

• Time Frame: Claims must be filed with the bond company within specified time limits outlined in the surety agreement. It’s important to act quickly, especially if you don't have access to the surety agreement. You can see when the contractor's surety policy expires on their profile with the Contractor’s State Licensing Board.

Filing a claim with the surety company can sometimes resolve the issue without needing to go to court, and it might be faster and less expensive than a lawsuit. If filing a claim with the contractor's bond company doesn't work, consider suing in a California small claims court.

We can help you prepare and file your small claims lawsuit against your contractor. Start Lawsuit.

Preparing to File Your Small Claims Lawsuit Against a Contractor

To sue a contractor in a California small claims court, you need to know:

1. If the contractor is doing business as an individual or as a corporation or LLC.

2. If the contractor is doing business as a corporation or LLC, then it is important to find who the "registered agent for service of process" is.

When filing a lawsuit against a contractor in a California small claims court, it is very important to write down their information correctly and ensure you are suing the correct business entity.

What does suing the "correct business entity" mean?

An example is the best way to explain this. Let's say you took you had "ABC Contractor" do work on your house.  

ABC Contractor may be a trade name for ABC Contractor, Inc. or even a more remote name like The ABCDEFG Contractor Company.

Contractors sometimes use a name other than their real legal entity name when doing business. This is called a fictitious business name. In general, contractors use fictitious business names or trade names for marketing purposes if their name or legal entity name is too long.

What happens if I don't sue the correct business entity for the contractor?

For one, you may be suing the wrong contractor as many have similar names. If you win the lawsuit, you will get a "judgment" against the incorrect contractor, and this will bring problems down the road. =

The goal here is to find the correct person or business to sue.

Who is the "registered agent for service of process"?

• Any corporation or LLC that does business in California must select a person (or another business) to receive legal documents (like a lawsuit) on its behalf in California.

• This person (or business) responsible for receiving legal documents on behalf of the contractor is called the "registered agent for service of process" or just the "registered agent."

• After the lawsuit is filed, this is the person (or business) who will be notified ("served") of the lawsuit on behalf of the contractor you are suing.

• If the contractor is doing business as an individual (or sole proprietor) there is no agent for service of process (the contractor is the person that has to be served with the lawsuit).

• Read more below on how to find the registered agent.

Read More: Complete Guide on how to file a Small Claims Court Lawsuit in California

Finding the Correct Legal Name for the Contractor

Make a list of any names the contractor has used in your interactions with them.

• Review any estimates, contracts, or invoices you received from the contractor. Usually, you can find the contractor's name on the top part of the estimate.

• Check any communications the contractor has sent you.

Search for the Contractor's License

• You can run a search using the California Department of Consumer Affairs Contractors State License Board Search.

• Keep in mind that not all contractors need to be licensed so the contractor may not show up on the database.

• If the search is successful, make sure to take screenshots of any information you find (especially if they are licensed as a business and if you see their address).

Run a search for their business license.

Each city in California has a database of business licenses registered in that city.

• If you know the contractor's address or the city they are based in, run a google search "business licenses [name of city]" and call the city department.

• The city department should be able to search by name, address, and sometimes a phone number.

• The city department can tell you whether the business license is registered to an individual, LLC, or Corporation.

• Make sure to ask what the business address is for the contractor as you will need this address to be able to serve the contractor. If the business license is registered to an LLC or Corporation, make sure to ask for the exact spelling then read the section below on running a search on the California Secretary of State's website.

Check the California Secretary of State's website

Using the list of names you created for the contractor, search the California Secretary of State's website. Keep in mind that most contractors are not doing business as a corporation or LLC but rather as sole proprietorships, but should run a search just in case.

Make sure you write down:

1. The complete legal entity name for the contractor.

2. Who the "registered agent for service of process" is. This is the person (or business) who will be served on behalf of the business you are suing. It will very likely be a business that is listed as the registered agent.

If no names come up, then run a fictitious business name search in the county where the contractor is located, see below.

We can help you prepare and file your small claims lawsuit against the contractor. Start Lawsuit. ‍

Determine Whether the Contractor is Using a Fictitious Business Name

Contractors often use fictitious business names, also known as dba or trade names.

What is a Fictitious Business Name?

Sometimes a contractor will operate using a name other than their legal name. This is known as a:

• "fictitious business name"

• "FBN"

• "doing business as"

• "DBA"

California law requires contractors that want to do business using a name other than their legal name to register the name in the county where their principal place of business is located.

The purpose of this is to ensure that when someone wants to sue a contractor, they are able to find the right person to sue.

How to search for registered fictitious business names?

• Each county has a database with the registered fictitious business names. If you determine that a corporation or LLC uses a fictitious business name, search the California Secretary of State's website using the official legal entity name.

• If you determine that an individual is using a fictitious business name, then you would list the individual as the person being sued (defendant) in the lawsuit.

Search for the name using the BBB (Better Business Bureau)

If you still can't find the correct business name, try searching on the BBB. If the contractor has had complaints in the past, then the Better Business Bureau might have looked up the legal entity name.

How to find the right business name on the BBB:

1. Go to the Better Business Bureau website.

2. Type the contractor's name. If you know the city and state where the contractor is located, then enter the city and state in the address box. Otherwise, leave it blank and press search.

3. A list of business names will come up. You may see a different business name than the one you typed. Try clicking on "view BBB review."

4. Go to the section labeled "Business Details." By verifying the address, determine whether it seems like the correct contractor you worked with. The business may list who the owner is or their correct legal entity name.

You need to find an adult not related to your lawsuit to notify the contractor that they have been sued. This is called "serving."

Options for who can serve your lawsuit:

• Find a neutral friend or family member.

• Hire a process server.

• Hire the sheriff (not available in all counties).

• Court clerk (not available in all counties).

Once the server serves your lawsuit, they will file a Proof of Service with the court.

Learn more about how to serve a California small claims lawsuit.

We can help you serve your small claims lawsuit. Get started.

Small claims hearings in California small claims are informal and most hearings last around 15 minutes. While many disputes against contractors settle before the hearing, here is what to expect if your lawsuit does not settle.

Who will represent the contractor at the hearing?

• The easiest way to answer this question is that a lawyer will not be representing the contractor since lawyers cannot represent parties at the initial small claims hearing.

If you and the contractor you sued, both show up:

• Right before the hearing, the judge will ask you and the contractor to show each other the evidence that you will later show the judge.

• The judge will ask you why you are suing.

• The judge will ask the contractor to tell them their side of the story.

• The hearing will last around 15 minutes.

• The judge will ask you to show them the evidence you brought. Sometimes the judge will keep the evidence. Other times, you will get the evidence right back.

• Very rarely a judge will tell you whether you won or lost at the hearing. Instead, the judge will tell you that their decision will be mailed to you (usually takes a few weeks to two months or so).

If you show up but the contractor you sued does not show up:

• If the contractor you sued does not show up to the hearing but you properly notified ("served") them, then the hearing will still take place. You don't automatically win and you will still have to tell the judge why you should win.

Learn More: How to win in California small claims.

If you win your small claims lawsuit, the California State Contractors License Board may be able to help you enforce the small claims judgment by suspending the contractor's license until they pay you.

• If you submit a copy of the judge's decision within 90 days from when the court decided your lawsuit, the CSLB will notify the contractor that they have 90 days from when CSLB notifies the contractor to pay the judgment. If the contractor does not pay the judgment, CSLB will suspend their license until they pay you.

• If the judgment is 91 days or older, CSLB will suspend the contractor's license until the judgment is paid.

In California, you can sue a contractor for a maximum of $12,500 if you are an individual (if you are suing on behalf of a corporation or LLC, the maximum you can sue for is $6,250). See California Code of Civil Procedure 116.221 and 116.220(a).

By suing in small claims, you are agreeing to waive any amount over the maximum amount you can sue for, even if you are owed more. See California Code of Civil Procedure Section 116.220(d).

For example, if a contractor owes you $13,000, and you decide to sue in small claims, you are waiving suing for an additional $500. Meaning that you will win a maximum of $12,500.

While you may not receive the full amount you are owed, there are practical benefits to suing in small claims court instead of "regular court."

Here are some of the benefits:

1. Court filing fees ($0-$75) are cheaper in small claims than in other courts.

2. The process is faster in small claims than in other courts, as your hearing will usually be scheduled 30-70 days after you file the lawsuit.

3. Lawyers are generally not allowed in small claims, which helps keep the costs of suing low.  

Court Filing Fees

The amount you will pay to file a small claims lawsuit in California depends on how much you are suing the contractor for. You will pay between $30 to $75 to file the lawsuit. If you cannot afford to pay court fees, you can ask the court to waive the fees.  

Serving Costs

Once the lawsuit is filed, you have to notify the contractor you sued that they have been sued. This is called "serving." Serving costs can range from $0-$125 per person or business you sue (serving is free with the sheriff if you qualify for a waiver of your court fees).

If you win, you may be able to have the contractor reimburse you for your court fees and serving costs.

We can help you prepare, file, and serve your small claims lawsuit against the contractor. Start Lawsuit.