No. 2--06--0135 filed: 11/27/06
______________________________________________________________________________
IN THE
APPELLATE COURT OF ILLINOIS
SECOND DISTRICT
______________________________________________________________________________
MD ELECTRICAL CONTRACTORS, ) Appeal from the Circuit Court
INC., ) of Du Page County.
)
Plaintiff-Appellant, )
)
v. ) No. 05--AR--1433
)
FRED ABRAMS and CAROL ABRAMS, ) Honorable
) Kenneth A. Abraham,
Defendants-Appellees. ) 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;
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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:
"§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).
"§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).
"§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
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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).
"§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
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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.
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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, *** altering, *** 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
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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
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"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,
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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
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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
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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
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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.
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McLAREN and O'MALLEY, JJ., concur.
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MD Electrical Eontractors, Inc. v. Abrams
Combined Opinion