You asked for the eligibility criteria for receiving payments from the Home Improvement Guaranty Fund. In particular, you wanted to know if it is true that the Department of Consumer Protection (DCP) made a payment on a claim based on the actions of an unregistered contractor, Scott Boucher, and if so, why.

SUMMARY

The consumer protection commissioner can order restitution from the fund on claims caused by the actions of currently registered home improvement contractors or contractors who were registered up to two years before the consumer signed the home improvement contract with the contractor.

The commissioner did not order restitution on a claim caused by the actions of Scott Boucher, a contractor who was never registered with DCP. A Journal Inquirer article about the issue dated October 28, 2002 is attached.

HOME IMPROVEMENT GUARANTY FUND

The Home Improvement Guaranty Fund is both a means of recourse for consumers who suffer harm from a contractor and a possible sanction for a contractor. It serves as recourse because it reimburses people who cannot recover losses suffered from a contractor's failure to fulfill a contract. It is a sanction because a contractor's registration, and his ability to work, is made conditional on his repaying the fund for any money paid out on his account.

A homeowner who obtains a court judgment against a registered contractor, or one who was registered within two years of entering the contract with the homeowner, may ask the DCP commissioner to be reimbursed from the fund. The restitution order may come from a suit brought by the homeowner, a civil suit brought by the state under the Connecticut Unfair Trade Practices Act (CUTPA), or a criminal proceeding brought under home improvement law. The request must be made within two years after the final judgment has been made or the time for appeal has passed. A homeowner can ask for the amount of the judgment, other than punitive damages, minus any amount already recovered from the contractor. The homeowner must affirm that he has had a writ of execution served on the contractor and that the officer executing it stated (1) that there are no bank accounts or real property to satisfy the judgment, (2) that the amount realized from such accounts or property was insufficient to satisfy the damage portion of the judgment, or (3) the amount realized and the amount still due. A homeowner with a judgment from small claims court, which can be for as much as $ 3,500, is exempt from the affirmation requirements. The consumer protection commissioner can pay restitution of up to $ 15,000 per claim. Before paying from the fund, the commissioner must give the contractor an opportunity for a hearing to contest whether he already paid the homeowner.

Once the fund has paid a homeowner, he must assign his rights to recover the money to DCP. It may seek to recover it from the contractor, plus reasonable interest. The commissioner may revoke the registration of any contractor whose actions have caused a guaranty fund payment and make reinstatement conditional on repaying the fund. The commissioner may allow a contractor to register before repayment if he agrees to repay by a certain date (CGS § 20-432).

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