2005 California Business and Professions Code Sections 7090-7124.6 Article 7. Disciplinary Proceedings

7090.  The registrar may upon his or her own motion and shall upon
the verified complaint in writing of any person, investigate the
actions of any applicant, contractor, or home improvement salesperson
within the state and may deny the licensure or the renewal of
licensure of, or cite, temporarily suspend, or permanently revoke any
license or registration if the applicant, licensee, or registrant,
is guilty of or commits any one or more of the acts or omissions
constituting causes for disciplinary action.
   The registrar may proceed to take disciplinary action as in this
article provided against an applicant or a person licensed or
registered under the provisions of this chapter even though the
grounds or cause for such disciplinary action arose upon projects or
while the applicant, licensee, or registrant was acting in a capacity
or under circumstances or facts which, under the provisions of
Sections 7044, 7045, 7046, and 7048, would otherwise exempt the
person or his or her operations from the provisions of this chapter.
   Notwithstanding any provision of this chapter, if the registrar
finds that any contractor licensed or registered under the provisions
of this chapter has willfully and deliberately violated any state or
local law relating to the issuance of building permits, other than
failure to obtain a county or city permit for repair, maintenance,
and adjustment of equipment where such repair, maintenance, or
adjustment is valued at less than five hundred dollars ($500) for
labor or materials, or where the repair of a part or component part
of mechanical equipment consists of replacing such part or component
part of mechanical equipment in need of repair with the identical
part or component part, the registrar shall take disciplinary action
against the contractor's license in accordance with this chapter.
   For the purpose of this section, there shall be a rebuttable
presumption affecting the burden of proof that construction performed
without a permit is a willful and deliberate violation.
7090.1.  (a) (1) Notwithstanding any other provisions of law, the
failure to pay a civil penalty, or to comply with an order of
correction or an order to pay a specified sum to an injured party in
lieu of correction once the order has become final, shall result in
the automatic suspension of a license by operation of law 30 days
after noncompliance with the terms of the order.
   (2) The registrar shall notify the licensee in writing of the
failure to comply with the final order and that the license shall be
suspended 30 days from the date of the notice.
   (3) The licensee may contest the determination of noncompliance
within 15 days after service of the notice, by written notice to the
registrar.  Upon receipt of the written notice, the registrar may
reconsider the determination and after reconsideration may affirm or
set aside the suspension.
   (4) Reinstatement may be made at any time following the suspension
by complying with the final order of the citation.  If no
reinstatement of the license is made within 90 days of the date of
the automatic suspension, the cited license and any other contractors'
license issued to the licensee shall be automatically revoked by
operation of law for a period to be determined by the registrar
pursuant to Section 7102.
   (5) The registrar may delay, for good cause, the revocation of a
contractor's license for failure to comply with the final order of
the citation.  The delay in the revocation of the license shall not
exceed one year. When seeking a delay of the revocation of his or her
license, a licensee shall apply to the registrar in writing prior to
the date of the revocation of the licensee's license by operation of
law and state the reasons that establish good cause for the delay.
The registrar's power to grant a delay of the revocation shall expire
upon the effective date of the revocation of the licensee's license
by operation of law.
   (b) The cited licensee shall also be automatically prohibited from
serving as an officer, director, associate, partner, or qualifying
individual of another licensee, for the period determined by the
registrar, and the employment, election, or association of that
person by a licensee shall constitute grounds for disciplinary
action.  Any qualifier disassociated pursuant to this section shall
be replaced within 90 days of the date of disassociation.  Upon
failure to replace the qualifier within 90 days of the prohibition,
the license of the other licensee shall be automatically suspended or
the qualifier's classification removed at the end of the 90 days.
7090.5.  In the event a licensee commits a fraudulent act which is a
ground for disciplinary action under Section 7116 of this article,
the correction of any condition resulting from such act shall not in
and of itself preclude the registrar from taking disciplinary action
under this article.
   If the registrar finds a licensee has engaged in repeated acts
which would be grounds for disciplinary action under this article,
and if by correction of conditions resulting from those acts the
licensee avoided disciplinary action as to each individual act, the
correction of those conditions shall not in and of itself preclude
the registrar from taking disciplinary action under this article.
7091.  (a) A complaint against a licensee alleging commission of any
patent acts or omissions that may be grounds for legal action shall
be filed in writing with the registrar within four years after the
act or omission alleged as the ground for the disciplinary action.
An accusation or citation against a licensee shall be filed or a
referral to the arbitration program outlined in Section 7085 shall be
referred within four years after the patent act or omission alleged
as the ground for disciplinary action or arbitration or within 18
months from the date of the filing of the complaint with the
registrar, whichever is later, except that with respect to an
accusation alleging a violation of Section 7112, the accusation may
be filed within two years after the discovery by the registrar or by
the board of the alleged facts constituting the fraud or
misrepresentation prohibited by the section.
   (b) A complaint against a licensee alleging commission of any
latent acts or omissions that may be grounds for legal action
pursuant to subdivision (a) of Section 7109 regarding structural
defects, as defined by regulation, shall be filed in writing with the
registrar within 10 years after the act or omission alleged as the
ground for the disciplinary action.  An accusation and citation
against a licensee shall be filed within 10 years after the latent
act or omission alleged as the ground for disciplinary action or
within 18 months from the date of the filing of the complaint with
the registrar, whichever is later, except that with respect to an
accusation alleging a violation of Section 7112, the accusation may
be filed within two years after the discovery by the registrar or by
the board of the alleged facts constituting the fraud or
misrepresentation prohibited by Section 7112.  As used in this
section "latent act or omission" means an act or omission that is not
apparent by reasonable inspection.
   (c) An accusation regarding an alleged breach of an express,
written warranty for a period in excess of the time periods specified
in subdivisions (a) and (b) issued by the contractor shall be filed
within the duration of that warranty.
   (d) The proceedings under this article shall be conducted in
accordance with the provisions of Chapter 5 (commencing with Section
11500) of Part 1 of Division 3 of Title 2 of the Government Code, and
the registrar shall have all the powers granted therein.
   (e) Nothing in this section shall be construed to affect the
liability of a surety or the period of limitations prescribed by law
for the commencement of actions against a surety or cash deposit.
7095.  The decision may:
   (a) Provide for the immediate complete suspension by the licensee
of all operations as a contractor during the period fixed by the
decision.
   (b) Permit the licensee to complete any or all contracts shown by
competent evidence taken at the hearing to be then uncompleted.
   (c) Impose upon the licensee compliance with such specific
conditions as may be just in connection with his operations as a
contractor disclosed at the hearing and may further provide that
until such conditions are complied with no application for
restoration of the suspended or revoked license shall be accepted by
the registrar.
7096.  For the purposes of this chapter, the term "licensee" shall
include an individual, copartnership, corporation, joint venture, or
any combination or organization licensed under this chapter, and
shall also include any named responsible managing officer or member
of the personnel of such licentiate whose appearance has qualified
the licentiate under the provisions of Section 7068.
7097.  Notwithstanding the provisions of Sections 7121 and 7122,
when any license has been suspended by a decision of the registrar
pursuant to an accusation or pursuant to subdivision (b) of Section
7071.17, Section 7085.6 or 7090.1, any additional license issued
under this chapter in the name of the licensee or for which the
licensee furnished qualifying experience and appearance under the
provisions of Section 7068, may be suspended by the registrar without
further notice.
7098.  Notwithstanding the provisions of Sections 7121 and 7122,
when any license has been revoked under the provisions of this
chapter, any additional license issued under this chapter in the name
of the licensee or for which the licensee furnished qualifying
experience and appearance under the provisions of Section 7068, may
be revoked by the registrar without further notice.
7099.  If, upon investigation, the registrar has probable cause to
believe that a licensee, or an applicant for a license under this
chapter, has committed any acts or omissions which are grounds for
denial, revocation, or suspension of license, he or she may, in lieu
of proceeding pursuant to this article, issue a citation to the
licensee or applicant.  Each citation shall be in writing and shall
describe with particularity the nature of the violation, including a
reference to the provisions alleged to have been violated.  In
addition, each citation may contain an order of correction fixing a
reasonable time for correction of the violation or an order, against
the licensee only, for payment of a specified sum to an injured party
in lieu of correction, and may contain an assessment of a civil
penalty.
7099.1.  The board shall promulgate regulations covering the
formulation of an  order of correction which gives due consideration
to the time required to correct and the practical feasibility of
correction.
7099.2.  (a) The board shall promulgate regulations covering the
assessment of civil penalties under this article which give due
consideration to the appropriateness of the penalty with respect to
the following factors:
   (1) The gravity of the violation.
   (2) The good faith of the licensee or applicant for licensure
being charged.
   (3) The history of previous violations.
   (b) Except as otherwise provided by this chapter, no civil penalty
shall be assessed in an amount greater than five thousand dollars
($5,000).  A civil penalty not to exceed fifteen thousand dollars
($15,000) may be assessed for a violation of Section 7114 or 7118.
7099.3.  Any licensee or applicant for licensure served with a
citation pursuant to Section 7099, may appeal to the registrar within
15 working days from service of the citation with respect to
violations alleged by the registrar, correction periods, amount of
penalties, and the reasonableness of the change required by the
registrar to correct the condition.
7099.4.  If within 15 working days from service of the citation
issued by the registrar, the licensee or applicant for licensure
fails to notify the registrar that he or she intends to contest the
citation, the citation shall be deemed a final order of the registrar
and not be subject to review by any court or agency.  The 15-day
period may be extended by the registrar for cause.
7099.5.  If a licensee or applicant for licensure notifies the
registrar that he or she intends to contest a citation issued under
Section 7099, the registrar shall afford an opportunity for a
hearing.  The registrar shall thereafter issue a decision, based on
findings of fact, affirming, modifying, or vacating the citation or
penalty, or directing other appropriate relief.  The proceedings
under this section shall be conducted in accordance with the
provisions of Chapter 5 (commencing with Section 11500) of Part 1 of
Division 3 of Title 2 of the Government Code, and the registrar shall
have all the powers granted therein.
7099.6.  (a) The failure of a licensee to comply with a citation
after it is final is a ground for suspension or revocation of
license.
   (b) The failure of an applicant for licensure to comply with a
citation after  it is final is a ground for denial of license.
7099.7.  No order for payment of a civil penalty shall be made
against any bond required pursuant to Sections 7071.5 to 7071.8.
7099.10.  (a) If, upon investigation, the registrar has probable
cause to believe that a licensee, an applicant for a license, or an
unlicensed individual acting in the capacity of a contractor who is
not otherwise exempted from the provisions of this chapter, has
violated Section 7027.1 by advertising for construction or work of
improvement covered by this chapter in an alphabetical or classified
directory, without being properly licensed, the registrar may issue a
citation under Section 7099 containing an order of correction which
requires the violator to cease the unlawful advertising and to notify
the telephone company furnishing services to the violator to
disconnect the telephone service furnished to any telephone number
contained in the unlawful advertising, and that subsequent calls to
that number shall not be referred by the telephone company to any new
telephone number obtained by that person.
   (b) If the person to whom a citation is issued under subdivision
(a) notifies the registrar that he or she intends to contest the
citation, the registrar shall afford an opportunity for a hearing, as
specified in Section 7099.5, within 90 days after receiving the
notification.
   (c) If the person to whom a citation and order of correction is
issued under subdivision (a) fails to comply with the order of
correction after the order is final, the registrar shall inform the
Public Utilities Commission of the violation, and the Public
Utilities Commission shall require the telephone corporation
furnishing services to that person to disconnect the telephone
service furnished to any telephone number contained in the unlawful
advertising.
   (d) The good faith compliance by a telephone corporation with an
order of the Public Utilities Commission to terminate service issued
pursuant to this section shall constitute a complete defense to any
civil or criminal action brought against the telephone corporation
arising from the termination of service.
7099.11.  (a) No person shall advertise, as that term is defined in
Section 7027.1, to promote his or her services for the removal of
asbestos unless he or she is certified to engage in asbestos-related
work pursuant to Section 7058.5, and registered for that purpose
pursuant to Section 6501.5 of the Labor Code.  Each advertisement
shall include that person's certification and registration numbers
and shall use the same name under which that person is certified and
registered.
   (b) The registrar shall issue a notice to comply with the order of
correction provisions of subdivision (a) of Section 7099.10, to any
person who is certified and registered, as described in subdivision
(a), and who fails to include in any advertisement his or her
certification and registration numbers.
   (c) The registrar shall issue a citation pursuant to Section 7099
to any person who fails to comply with the notice required by
subdivision (b), or who advertises to promote his or her services for
the removal of asbestos but does not possess valid certification and
registration numbers as required by subdivision (a), or who fails to
use in that advertisement the same name under which he or she is
certified and registered.
   Citations shall be issued and conducted pursuant to Sections 7099
to 7099.10, inclusive.
7100.  In any proceeding for review by a court, the court may in its
discretion, upon the filing of a proper bond by the licensee in an
amount to be fixed by the court, but not less than one thousand
dollars ($1,000) or an amount the court finds is sufficient to
protect the public, whichever is greater, guaranteeing the compliance
by the licensee with specific conditions imposed upon him by the
registrar's decision, if any, permit the licensee to continue to do
business as a contractor pending entry of judgment by the court in
the case.  There shall be no stay of the registrar's decision pending
an appeal or review of any such proceeding unless the appellant or
applicant for review shall file a bond in all respects conditioned
as, and similar to, the bond required to stay the effect of the
registrar's decision in the first instance.
7102.  After suspension of the license upon any of the grounds set
forth in this chapter, the registrar may reinstate the license upon
proof of compliance by the contractor with all provisions of the
decision as to reinstatement or, in the absence of such decision or
any provisions therein as to reinstatement, in the sound discretion
of the registrar.
   After revocation of a license upon any of the grounds set forth in
this chapter, the license shall not be reinstated or reissued and a
license shall not be issued to any member of the personnel of the
revoked licensee found to have had knowledge of or participated in
the acts or omissions constituting grounds for revocation, within a
minimum period of one year and a maximum period of five years after
the final decision of revocation and then only on proper showing that
all loss caused by the act or omission for which the license was
revoked has been fully satisfied and that all conditions imposed by
the decision of revocation have been complied with.
   The board shall promulgate regulations covering the criteria to be
considered when extending the minimum one-year period.  The criteria
shall give due consideration to the appropriateness of the extension
of time with respect to the following factors:
   (a) The gravity of the violation.
   (b) The history of previous violations.
   (c) Criminal convictions.
   When any loss has been reduced to a monetary obligation or debt,
however, the satisfaction of such monetary obligation or debt as a
prerequisite for the issuance, reissuance, or reinstatement of a
license shall not be required where such monetary obligation or debt
has been adjudicated in a bankruptcy proceeding.  However, any
nonmonetary condition not adjudicated in a bankruptcy proceeding
shall be complied with prior to the issuance, the reissuance, or
reinstatement of the license.
7103.  The revocation, suspension, or other disciplinary action of a
license to act as a contractor by another state shall constitute
grounds for disciplinary action in this state if the individual is a
licensee, or applies for a license, in this state.  A certified copy
of the revocation, suspension, or other disciplinary action by the
other state is conclusive evidence of that action.
7104.  When the board resolves a complaint, the board shall notify
the complainant in writing of its action and the reasons for taking
that action.  The board shall provide the same notice in writing to
the contractor provided that the contractor is licensed and the
notification would not jeopardize an action or investigation that
involves the contractor.
7106.  The suspension or revocation of license as in this chapter
provided may also be embraced in any action otherwise proper in any
court involving the licensee's performance of his legal obligation as
a contractor.
7106.5.  The expiration, cancellation, forfeiture, or suspension of
a license by operation of law or by order or decision of the
registrar or a court of law, or the voluntary surrender of a license
by a licensee shall not deprive the registrar of jurisdiction to
proceed with any investigation of or action or disciplinary
proceeding against  the license, or to render a decision suspending
or revoking  the license.
7107.  Abandonment without legal excuse of any construction project
or operation engaged in or undertaken by the licensee as a contractor
constitutes a cause for disciplinary action.
7108.  Diversion of funds or property received for prosecution or
completion of a specific construction project or operation, or for a
specified purpose in the prosecution or completion of any
construction project or operation, or failure substantially to
account for the application or use of such funds or property on the
construction project or operation for which such funds or property
were received constitutes a cause for disciplinary action.
7108.5.  A prime contractor or subcontractor shall pay to any
subcontractor, not later than 10 days of receipt of each progress
payment, unless otherwise agreed to in writing, the respective
amounts allowed the contractor on account of the work performed by
the subcontractors, to the extent of each subcontractor's interest
therein.  In the event that there is a good faith dispute over all or
any portion of the amount due on a progress payment from the prime
contractor or subcontractor to a subcontractor, then the prime
contractor or subcontractor may withhold no more than 150 percent of
the disputed amount.
   Any violation of this section shall constitute a cause for
disciplinary action and shall subject the licensee to a penalty,
payable to the subcontractor, of 2 percent of the amount due per
month for every month that payment is not made.  In any action for
the collection of funds wrongfully withheld, the prevailing party
shall be entitled to his or her attorney's fees and costs.
   The sanctions authorized under this section shall be separate
from, and in addition to, all other remedies either civil,
administrative, or criminal.
   This section applies to all private works of improvement and to
all public works of improvement, except where Section 10262 of the
Public Contract Code applies.
7108.6.  A licensed contractor is required to pay all transportation
charges submitted by a duly authorized motor carrier of property in
dump truck equipment by the 20th day following the last day of the
calendar month in which the transportation was performed, if the
charges, including all necessary documentation, are submitted by the
fifth day following the last day of the calendar month in which the
transportation was performed.  The payment shall be made unless
otherwise agreed to in writing by the contractor and by the duly
authorized motor carrier of property in dump truck equipment.  In the
event that there is a good faith dispute over a portion of the
charges claimed, the contractor may withhold payment of up to 150
percent of the disputed amount or an amount otherwise agreed to by
the parties.  A violation of this section constitutes a cause for
disciplinary action under Section 7120 and shall also subject the
contractor licensee to a penalty, payable to the carrier, of 2
percent of the amount due per month for every month that payment is
outstanding.  In an action for the collection of moneys not paid in
accordance with this section, the prevailing party shall be entitled
to his or her attorney's fees and costs.
   This section applies to all private works of improvement and to
all public works of improvement.
7109.  (a) A willful departure in any material respect from accepted
trade standards for good and workmanlike construction constitutes a
cause for disciplinary action, unless the departure was in accordance
with plans and specifications prepared by or under the direct
supervision of an architect.
   (b) A willful departure from or disregard of plans or
specifications in any material respect, which is prejudicial to
another, without the consent of the owner or his or her duly
authorized representative and without the consent of the person
entitled to have the particular construction project or operation
completed in accordance with such plans or specifications,
constitutes a cause for disciplinary action.
7109.5.  Violation of any safety provision in, or authorized by,
Division 5 (commencing with Section 6300) of the Labor Code resulting
in death or serious injury to an employee constitutes a cause for
disciplinary action.
7110.  Willful or deliberate disregard and violation of the building
laws of the state, or of any political subdivision thereof, or of
Section 8505 or 8556 of this code, or of Sections 1689.5 to 1689.8,
inclusive, or Sections 1689.10 to 1689.13, inclusive, of the Civil
Code, or of the safety laws or labor laws or compensation insurance
laws or Unemployment Insurance Code of the state, or violation by any
licensee of any provision of the Health and Safety Code or Water
Code, relating to the digging, boring, or drilling of water wells, or
Article 2 (commencing with Section 4216) of Chapter 3.1 of Division
5 of Title 1 of the Government Code, constitutes a cause for
disciplinary action.
7110.1.  The requiring of an execution of release of any claim or
the causing of the execution of any such release in violation of
Section 206.5 of the Labor Code is a cause for disciplinary action.
7110.5.  Upon receipt of a certified copy of the Labor Commissioner'
s finding of a willful or deliberate violation of the Labor Code by a
licensee, pursuant to Section 98.9 of the Labor Code, the registrar
shall initiate disciplinary action against the licensee within 30
days of notification.
7111.  (a) Failure to make and keep records showing all contracts,
documents, records, receipts, and disbursements by a licensee of all
of his or her transactions as a contractor, and failure to have those
records available for inspection by the registrar or his or her duly
authorized representative for a period of not less than five years
after completion of any construction project or operation to which
the records refer, or refusal by a licensee to comply with a written
request of the registrar to make the records available for inspection
constitutes a cause for disciplinary action.
   (b) Failure of a licensee, applicant, or registrant subject to the
provisions of this chapter, who without lawful excuse, delays,
obstructs, or refuses to comply with a written request of the
registrar or designee for information or records, to provide that
information or make available those records, when the information or
records are required in the attempt to discharge any duty of the
registrar, constitutes a cause for disciplinary action.
7111.1.  The failure of, or refusal by, a licensee to respond to a
written request of the registrar to cooperate in the investigation of
a complaint against that licensee constitutes a cause for
disciplinary action.
7112.  Omission or misrepresentation of a material fact by an
applicant or a licensee in obtaining, or renewing a license, or in
adding a classification to an existing license constitutes a cause
for disciplinary action.
7112.1.  Any classification that has been added to an existing
license record as a result of an applicant or licensee omitting or
misrepresenting a material fact shall be expunged from the license
record pursuant to a final order of the registrar evidencing a
violation of Section 7112.
7113.  Failure in a material respect on the part of a licensee to
complete any construction project or operation for the price stated
in the contract for such construction project or operation or in any
modification of such contract constitutes a cause for disciplinary
action.
7113.5.  The avoidance or settlement by a licensee for less than
their full amount of the lawful obligations of such licensee incurred
as a contractor, whether by (a) composition, arrangement, or
reorganization with creditors under state law, (b) composition,
arrangement, or reorganization with creditors under any agreement or
understanding, (c) receivership as provided in Chapter 5 (commencing
at Section 564) of Title 7 of Part 2 of the Code of Civil Procedure,
(d)  assignment for the benefit of creditors, (e)  trusteeship, or
(f) dissolution constitutes a cause for disciplinary action.
   This section shall not apply to an individual settlement of the
obligation of a licensee by such licensee with a creditor which is
not a part of or in connection with a settlement with other creditors
of such licensee.
   No disciplinary action shall be commenced against a licensee for
avoiding or settling in bankruptcy, or by composition, arrangement,
or reorganization with creditors under federal law, the licensee's
lawful obligations incurred as a contractor for less than the full
amount of such obligations.
7114.  Aiding or abetting an unlicensed person to evade the
provisions of this chapter or combining or conspiring with an
unlicensed person, or allowing one's license to be used by an
unlicensed person, or acting as agent or partner or associate, or
otherwise, of an unlicensed person with the intent to evade the
provisions of this chapter constitutes a cause for disciplinary
action.
7114.1.  Any licensee whose signature appears on a falsified
certificate in support of an examinee's experience qualifications, or
otherwise certifying to false or misleading experience claims by an
applicant, which have been submitted to obtain a contractor's license
shall be subject to disciplinary action.
7115.  Failure in any material respect to comply with the provisions
of this chapter, or any rule or regulation adopted pursuant to this
chapter, or to comply with the provisions of Section 7106 of the
Public Contract Code, constitutes a cause for disciplinary action.
7116.  The doing of any wilful or fraudulent act by the licensee as
a contractor in consequence of which another is substantially injured
constitutes a cause for disciplinary action.
7116.5.  It is a cause for discipline for a licensee to do any of
the following:
   (a) Engage in any conduct that subverts or attempts to subvert an
investigation of the board.
   (b) Threaten or harass any person or licensee for providing
evidence in any possible or actual disciplinary action, arbitration,
or other legal action.
   (c) Discharge an employee primarily because of the employee's
attempt to comply with or aid in compliance with the provisions of
this chapter.
7117.  Acting in the capacity of a contractor under any license
issued hereunder except:  (a) in the name of the licensee as set
forth upon the license, or (b) in accordance with the personnel of
the licensee as set forth in the application for such license, or as
later changed as provided in this chapter, constitutes a cause for
disciplinary action.
7117.5.  (a) Acting in the capacity of a contractor under any
license which has been made inactive, as provided in Section 7076.5,
constitutes a cause for disciplinary action.
   (b) Acting in the capacity of a contractor under any license that
has been suspended for any reason constitutes a cause for
disciplinary action.
   (c) Acting in the capacity of a contractor under any license that
has expired constitutes a cause for disciplinary action if the
license is subject to renewal pursuant to Section 7141.  The actions
authorized under this section shall be separate from, and in addition
to, all other remedies either civil or criminal.
7117.6.  Acting in the capacity of a contractor in a classification
other than that currently held by the licensee constitutes a cause
for disciplinary action.
7118.  Entering into a contract with a contractor while such
contractor is not licensed as provided in this chapter constitutes a
cause for disciplinary action.
7118.4.  (a) If a contractor has made an inspection for the purpose
of determining the presence of asbestos or the need for related
remedial action with knowledge that the report has been required by a
person as a condition of making a loan of money secured by the
property, or is required by a public entity as a condition of issuing
a permit concerning the property, the contractor  shall disclose
orally and in writing if it is owned or has any common ownership, or
any financial relationship whatsoever, including, but not limited to,
commissions or referral fees, with an entity in the business of
performing the corrective work.
   (b) This section does not prohibit a contractor that has
contracted to perform corrective work after the report of another
company has indicated the presence of asbestos or the need for
related remedial action from making its own inspection prior to
performing that corrective work or from making an inspection to
determine whether the corrective measures were successful and, if
not, thereafter peforming additional corrective work.
   (c) A violation of this section is grounds for disciplinary
action.
   (d) A violation of this section is a misdemeanor punishable by a
fine of not less than three thousand dollars ($3,000) and not more
than five thousand dollars ($5,000), or by imprisonment in the county
jail for not more than one year, or both.
   (e) For the purpose of this section, "asbestos" has the meaning
set forth in Section 6501.7 of the Labor Code.
7118.5.  Any contractor, applicant for licensure, or person required
to be licensed, who, either knowingly or negligently, or by reason
of a failure to inquire, enters into a contract with another person
who is required to be, and is not, certified pursuant to Section
7058.5 to engage in asbestos-related work, as defined in Section
6501.8 of the Labor Code, is subject to the following penalties:
   (a) Conviction of a first offense is an infraction punishable by a
fine of not less than one thousand dollars ($1,000) or more than
three thousand dollars ($3,000), and by possible revocation or
suspension of any contractor's license.
   (b) Conviction of a subsequent offense is a misdemeanor requiring
revocation or suspension of any contractor's license, and a fine of
not less than three thousand dollars ($3,000) or more than five
thousand dollars ($5,000), or imprisonment in the county jail for not
more than one year, or both the fine and imprisonment.
7118.6.  Any contractor who, either knowingly or negligently, or by
reason of a failure to inquire, enters into a contract with another
person who is required to be, and is not certified pursuant to
Section 7058.7 to engage in a removal or remedial action, as defined
in Section 7058.7, is subject to the following penalties:
   (a) Conviction of a first offense is an infraction punishable by a
fine of not less than one thousand dollars ($1,000) or more than
three thousand dollars ($3,000), and by possible revocation or
suspension of any contractor's license.
   (b) Conviction of a subsequent offense is a misdemeanor requiring
revocation or suspension of any contractor's license, and a fine of
not less than three thousand dollars ($3,000) or more than five
thousand dollars ($5,000), or imprisonment in the county jail for not
more than one year, or both the fine and imprisonment.
7119.  Wilful failure or refusal without legal excuse on the part of
a licensee as a contractor to prosecute a construction project or
operation with reasonable diligence causing material injury to
another constitutes a cause for disciplinary action.
7120.  Wilful or deliberate failure by any licensee or agent or
officer thereof, to pay any moneys, when due for any materials or
services rendered in connection with his operations as a contractor,
when he has the capacity to pay or when he has received sufficient
funds therefor as payment for the particular construction work,
project, or operation for which the services or materials were
rendered or purchased constitutes a cause for disciplinary action, as
does the false denial of any such amount due or the validity of the
claim thereof with intent to secure for himself, his employer, or
other person, any discount upon such indebtedness or with intent to
hinder, delay, or defraud the person to whom such indebtedness is
due.
7121.  Any person who has been denied a license for a reason other
than failure to document sufficient satisfactory experience for a
supplemental classification for an existing license, or who has had
his or her license revoked, or whose license is under suspension, or
who has failed to renew his or her license while it was under
suspension, or who has been a member, officer, director, or associate
of any partnership, corporation, firm, or association whose
application for a license has been denied for a reason other than
failure to document sufficient satisfactory experience for a
supplemental classification for an existing license, or whose license
has been revoked, or whose license is under suspension, or who has
failed to renew a license while it was under suspension, and while
acting as a member, officer, director, or associate had knowledge of
or participated in any of the prohibited acts for which the license
was denied, suspended, or revoked, shall be prohibited from serving
as an officer, director, associate, partner, or qualifying individual
of a licensee, and the employment, election, or association of this
type of person by a licensee in any capacity other than as a
nonsupervising bona fide employee shall constitute grounds for
disciplinary action.
7121.1.  Notwithstanding any other provision of this chapter, the
disassociation of any member, officer, director, or associate from
the license of any partnership, corporation, firm, or association
whose license has been cited pursuant to Section 7099 shall not
relieve the member, officer, director, or associate from
responsibility for complying with the citation if he or she had
knowledge of, or participated in, any of the prohibited acts for
which the citation was issued.  Section 7121 shall apply to any
member, officer, director, or associate of a licensee that fails to
comply with a citation after it is final.
7121.5.  Any person who was the qualifying individual on a revoked
license, or of a license under suspension, or of a license that was
not renewed while it was under suspension, shall be prohibited from
serving as an officer, director, associate, partner, or qualifying
individual of a licensee, whether or not the individual had knowledge
of or participated in the prohibited acts or omissions for which the
license was revoked, or suspended, and the employment, election, or
association of such person by a licensee shall constitute grounds for
disciplinary action.
7122.  The performance by any individual, partnership, corporation,
firm, or association of any act or omission constituting a cause for
disciplinary action, likewise constitutes a cause for disciplinary
action against any licensee other than the individual qualifying on
behalf of the individual or entity, if the licensee was a member,
officer, director, or associate of such individual, partnership,
corporation, firm or association at the time such act or omission
occurred, and had knowledge of or participated in such prohibited act
or omission.
7122.1.  Notwithstanding Section 7068.2 or any other provision of
this chapter, the disassociation of any qualifying partner,
responsible managing officer, or responsible managing employee from a
license after the act or omission has occurred that resulted in a
citation pursuant to Section 7099 shall not relieve the qualifying
partner, responsible managing officer, or responsible managing
employee from responsibility for complying with the citation.
Section 7122.5 shall apply to any qualifying partner, responsible
managing officer, or responsible managing employee of a licensee that
fails to comply with a citation after it is final.
7122.2.  (a) Notwithstanding Section 7068.2 or any other provisions
of this chapter, the disassociation of any qualifying partner,
responsible managing officer, or responsible managing employee from a
license that has been referred to arbitration pursuant to Section
7085 shall not relieve the qualifying partner, responsible managing
officer, or responsible managing employee from the responsibility of
complying with an arbitration award rendered as a result of acts or
omissions committed while acting as the qualifying partner,
responsible managing officer, or responsible managing employee for
the license as provided under Sections 7068 and 7068.1.
   (b) Section 7122.5 shall apply to any qualifying partner,
responsible managing officer, or responsible managing employee of a
licensee that fails to comply with an arbitration award once it is
rendered.
7122.5.  The performance by any individual, partnership,
corporation, firm, or association of any act or omission constituting
a cause for disciplinary action, likewise constitutes a cause for
disciplinary action against any licensee who at the time such act or
omission occurred was the responsible managing employee, qualifying
partner, responsible managing officer, or qualifying member of such
individual, partnership, corporation, firm, or association, whether
or not he had knowledge of or participated in the prohibited act or
omission.
7123.  A conviction of a crime substantially related to the
qualifications, functions and duties of a contractor constitutes a
cause for disciplinary action. The record of the conviction shall be
conclusive evidence thereof.
7123.5.  If a contractor is convicted of violating Section 396 of
the Penal Code or any substantially similar local ordinance in
connection with the sale, or offer for sale, of repair or
reconstruction services, as defined in Section 396 of the Penal Code,
the Contractors' State License Board shall take disciplinary action
against the contractor, which shall include a suspension of at least
six months or the permanent revocation of the contractor's license.
7124.  A plea or verdict of guilty or a conviction following a plea
of nolo contendere is deemed to be a conviction within the meaning of
this article.  The board may order the license suspended or revoked,
or may decline to issue a license, when the time for appeal has
elapsed, or the judgment of conviction has been affirmed on appeal or
when an order granting probation is made suspending the imposition
of sentence, irrespective of a subsequent order under the provisions
of Section 1203.4 of the Penal Code allowing such person to withdraw
his plea of guilty and to enter a plea of not guilty, or setting
aside the verdict of guilty, or dismissing the accusation,
information or indictment.
7124.6.  (a) The registrar shall make available to members of the
public the date, nature, and status of all complaints on file against
a licensee that do either of the following:
   (1) Have been referred for accusation.
   (2) Have been referred for investigation after a determination by
board enforcement staff that a probable violation has occurred, and
have been reviewed by a supervisor, and regard allegations that if
proven would present a risk of harm to the public and would be
appropriate for suspension or revocation of the contractor's license
or criminal prosecution.
   (b) The board shall create a disclaimer that shall accompany the
disclosure of a complaint that shall state that the complaint is an
allegation.  The disclaimer may also contain any other information
the board determines would be relevant to a person evaluating the
complaint.
   (c) A complaint resolved in favor of the contractor shall not be
subject to disclosure.
   (d) Except as described in subdivision (e), the registrar shall
make available to members of the public the date, nature, and
disposition of all legal actions.
   (e) Disclosure of legal actions shall be limited as follows:
   (1) Citations shall be disclosed from the date of issuance and for
five years after the date of compliance if no additional
disciplinary actions have been filed against the licensee during the
five-year period.  If additional disciplinary actions were filed
against the licensee during the five-year period, all disciplinary
actions shall be disclosed for as long as the most recent
disciplinary action is subject to disclosure under this section.  At
the end of the specified time period, those citations shall no longer
be disclosed.
   (2) Accusations that result in suspension, stayed suspension, or
stayed revocation of the contractor's license shall be disclosed from
the date the accusation is filed and for seven years after the
accusation has been settled, including the terms and conditions of
probation if no additional disciplinary actions have been filed
against the licensee during the seven-year period.  If additional
disciplinary actions were filed against the licensee during the
seven-year period, all disciplinary actions shall be posted for as
long as the most recent disciplinary action is subject to disclosure
under this section. At the end of the specified time period, those
accusations shall no longer be disclosed.
   (3) All revocations that are not stayed shall be disclosed
indefinitely from the effective date of the revocation.