MHIC Maryland Home Improvement Law and Contracts Flashcards

An MHIC contractor completes a kitchen remodel but leaves the job site before completing the punch-list items the homeowner requested. This may constitute which violation under the MHIA?

Answer: Abandonment of a home improvement contract

Leaving a job before completing all contracted work without legal justification constitutes abandonment of a home improvement contract, which is a serious violation of the MHIA subject to disciplinary action and potential liability to the homeowner.

A homeowner wants to add a room to their house. The contractor they hire has an MHIC license. Which statement is CORRECT regarding permits for this project?

Answer: The contractor should pull the necessary building permit from the local jurisdiction

For a room addition, the licensed MHIC contractor should obtain the required building permit from the local county or municipal building department. The MHIC license does not substitute for or exempt a project from local permit requirements.

Which of the following is a REQUIRED element of every written home improvement contract in Maryland?

Answer: The MHIC license number of the contractor

Maryland law requires that every written home improvement contract include the contractor's MHIC license number. This allows homeowners to verify licensure and is a mandatory disclosure under the MHIA.

A contractor performs home improvement work without an MHIC license on a project valued at $2,000. What penalty does the contractor potentially face under Maryland law?

Answer: A civil fine of up to $5,000 per violation and possible criminal charges

Unlicensed contracting in Maryland is a serious offense. A person who acts as a home improvement contractor without a license may face civil fines of up to $5,000 per violation and may also be subject to criminal prosecution. The courts have also held that unlicensed contractors may be unable to enforce payment contracts.

A homeowner rescinds (cancels) a home improvement contract within the allowable period. What must the contractor do?

Answer: Return any deposit paid by the homeowner within 10 days and not begin work

When a homeowner properly exercises their right to rescind a home improvement contract within the cancellation period, the contractor must return any deposit or payments received within 10 days and must not begin or continue the work. Retaining deposits or charging cancellation fees in this situation violates the consumer's rescission rights.

Under the MHIA, which of the following disclosures MUST appear on the face of every home improvement contract?

Answer: Notice of the homeowner's right to cancel the contract

Maryland law requires that every home improvement contract include a notice informing the homeowner of their right to cancel (rescind) the contract within the applicable period. This notice must be conspicuous and is a mandatory consumer protection disclosure.

A licensed MHIC contractor wants to make a change to the scope of work after the original contract has been signed. What is the proper procedure under Maryland law?

Answer: Any change to the contracted work must be documented in a signed written change order before the additional work is performed

The proper procedure for any change to the scope, price, or materials in a home improvement contract is to execute a signed written change order before the additional work is performed. Verbal agreements for additional work are difficult to enforce and do not meet the written contract requirements of the MHIA.