Arbitration for Certain Disputes (SB 1284)

Senate Bill 1284 changes existing law to permit certain claims to the Registrar of Contractors (ROC) to be referred to arbitration.  When the cost of repair is $5,000 or less and a party disputes the ROC’s corrective work order, Senate Bill 1284 requires such claim to be determined by an arbitration process in which the arbitrator cannot suspend or revoke the contractor’s license or award monetary damages, civil penalties, legal fees or costs.  Larger claims may be resolved through the arbitration process if both parties consent.  The ROC determines the cost of repair at the time of its investigation.  The ROC can continue to suspend a contractor’s license for failure to comply with a final order unless the contractor has posted a bond in the amount of the claim.  Senate Bill 1284 also repeals the existing law that permitted the ROC to assess a fee to residential contractors when the balance of the Recovery Fund falls below $2 million.