There is a newer version of the North Dakota Century Code
2009 North Dakota Code
43 Occupations and Professions
43-07 Contractors
Download pdfalteration, dismantling, or demolition of bridges, highways, roads, streets, buildings,
airports, dams, drainage or irrigation ditches, sewers, water or gas mains, water
filters, tanks, towers, oil, gas, or water pipelines, and every other type of structure,
project, development, or improvement coming within the definition of real or personal
property, including the construction, alteration, or repair of property to be held either
for sale or rental, and shall include subcontractor, public contractor, and nonresident
contractor. 2. "Nonresident contractor" means any contractor who has not an established and
maintained place of business within this state, or who has not made reports to North
Dakota workforce safety and insurance within the previous year of employees within
this state, and who has not made contributions to the North Dakota workforce safety
and insurance fund accordingly, or who, during a like period has not made an
income tax return in this state. 3. "Person" includes any individual, firm, copartnership, association, corporation,
limited liability company, or other group or combination thereof acting as a unit, and
the plural as well as the singular number, unless the intent to give a more limited
meaning is disclosed clearly by the context thereof. 4. "Public contract" means a contract with the state of North Dakota or any board,
commission, or department thereof, or with any board of county commissioners, or
with any city council or board of city commissioners, board of township supervisors,
school board, or with any state or municipal agency, or with any other public board,
body, commission, or agency authorized to let or award contracts for the
construction or reconstruction of public work when the contract cost, value, or price
exceeds the sum of two thousand dollars and includes subcontracts undertaken to
perform work covered by the original contract or any part thereof when the contract
cost, value, or price of the work included in such subcontract exceeds the sum of
two thousand dollars. 5. "Registrar" means the secretary of state of the state of North Dakota. 43-07-02. License required. A person may not engage in the business nor act in the capacity of a contractor within this state when the cost, value, or price per job exceeds the sum of
two thousand dollars nor may that person maintain any claim, action, suit, or proceeding in any
court of this state related to the person's business or capacity as a contractor without first having
a license as provided in this chapter. 43-07-03. Registrar designated. The secretary of state as registrar has authority to employ such assistance and procure such records, supplies, and equipment as may be
necessary to carry out the provisions of this chapter. 43-07-04. License - How obtained - Failure to grant - Revocation. 1. To obtain a license under this chapter, an applicant who is eighteen years of age or
older shall submit, on forms the registrar prescribes, an application under oath
containing a statement of the applicant's experience and qualifications as a
contractor. A copy of a certificate of liability insurance must be filed with the application and the contractor shall submit a statement from North Dakota workforce
safety and insurance that the contractor has secured workforce safety and insurance Page No. 1 coverage satisfactory to workforce safety and insurance. If the registrar deems it
appropriate or necessary, the registrar may also require any other information to
assist the registrar in determining the applicant's fitness to act in the capacity of a
contractor, including, at the expense of the applicant, criminal history record
information of the applicant or the officers, members, or partners of the applicant
which is held or maintained by the bureau of criminal investigation or a similar entity
in another state. The application must contain a statement that the applicant desires
the issuance of a license under this chapter and must specify the class of license
sought. 2. The registrar may refuse to grant a license if the registrar determines the application
contains false, misleading, or incomplete information; the applicant fails or refuses to
authorize or pay for criminal history information requested by the registrar; or as
otherwise provided in sections 12.1-33-02.1 and 43-07-04.1. The registrar shall notify the applicant in writing if the registrar does not grant the license and shall
provide the applicant an opportunity to respond to or cure the defect in the
application for a period of ten days from the date of the written notification. An
applicant aggrieved by a decision of the registrar not to grant the license may appeal
the decision to the district court of the applicant's county of residence or Burleigh
County. 3. No sooner than twenty days after sending written notice to a contractor at the
contractor's last-known address, the registrar shall classify as not in good standing
the license of any contractor who fails to: a. Maintain liability insurance coverage required by this section or by section
43-07-10; b. File, renew, or properly amend any fictitious name certificate required by
chapter 45-11; c. Maintain an active status of a corporation or registration as a foreign
corporation; d. Maintain an active status of a limited liability company or registration as a
foreign limited liability company; e. File or renew a trade name registration as required by chapter 47-25; f. Maintain a limited liability partnership registration or foreign limited liability
partnership registration as required by chapter 45-22; or g. Maintain a limited partnership certificate of limited partnership or foreign limited
partnership certificate of authority. 4. Any contractor who has been notified by the registrar that the contractor's license is
not in good standing shall cease soliciting or entering new contract projects. If the
contractor fails to correct the deficiency specified in the notice by evidence
satisfactory to the registrar within thirty days of the date of the notice or if the
contractor solicits or enters new contract projects while the contractor's license is not
in good standing, the registrar shall use the procedures of chapter 28-32 to revoke
the license of the contractor. 43-07-04.1. Conviction not bar to licensure - Exceptions. Conviction of an offense does not disqualify a person from licensure under this chapter unless the secretary of state
determines that the offense has a direct bearing upon a person's ability to serve the public as a
contractor or that, following conviction of any offense, the person is not sufficiently rehabilitated
under section 12.1-33-02.1. Page No. 2 43-07-05. Classes of licenses. Four classes of licenses must be issued under this chapter, which must be designated as class A, B, C, and D licenses. The holders of such licenses are entitled to engage in the contracting business within this state subject to the
following limitations: 1. The holder of a class A license is subject to no limitation as to the value of any single
contract project. 2. The holder of a class B license is not entitled to engage in the construction of any
single contract project of a value in excess of two hundred fifty thousand dollars. 3. The holder of a class C license is not entitled to engage in the construction of any
single contract project of a value in excess of one hundred twenty thousand dollars. 4. The holder of a class D license is not entitled to engage in the construction of any
single contract project of a value in excess of fifty thousand dollars. 43-07-06. Administrative and governing bodies may impose requirements. Any administrative body or governing body, agency, or commission having power to enter into public
contracts may impose reasonable requirements and conditions as conditions precedent to the
awarding of a contract for the construction or reconstruction of public works in addition to the
requirements imposed by this chapter. 43-07-07. License fees. At the time of making application for a license as described and required in this chapter, the applicant shall pay to the registrar the following fees: 1. For a class A license, the sum of three hundred dollars. 2. For a class B license, the sum of two hundred dollars. 3. For a class C license, the sum of one hundred fifty dollars. 4. For a class D license, the sum of fifty dollars. All moneys collected by the registrar under this chapter must be deposited by the registrar with
the state treasurer, who shall credit them to the general fund of the state. 43-07-08. Exceptions. This chapter does not apply to: 1. Any authorized representative or representatives of the United States government,
the state of North Dakota, or any county, municipality, irrigation district, reclamation
district, or other political corporation. 2. Any person who furnishes any fabricated or finished product, material, or article of
merchandise which is not incorporated into or attached to real property by such
person so as to become affixed thereto. 43-07-09. Duty of registrar - Expiration of license. Within fifteen days from the date of application, the registrar may investigate and determine each applicant's fitness to act in the
capacity of contractor as defined in this chapter, and no license may be issued to such applicant
until the registrar receives all documentation necessary to obtain a license and the appropriate
fee. The license issued on an original application entitles the licensee to act as a contractor
within this state, subject to the limitations of such license, until the expiration of the then current
fiscal year ending March first, except that an initial license issued to a licensee in January or
February is valid until March first of the subsequent year. 43-07-09.1. Name changes. Not later than ten days after the date of a change in a contractor's name, the licensee must notify the registrar of the name change on a form provided
by the registrar. A name change must be accompanied by a ten dollar fee. A licensee may not Page No. 3 change its name if the change is associated with a change in the legal status other than a
change in marital status. A corporation, limited liability company, limited liability partnership, or
limited partnership registered with the secretary of state is not subject to this section. 43-07-10. Renewal of license - Grounds for nonrenewal - Time requirements - Invalidity of license for failure to renew. 1. Any license issued under this chapter may be renewed for each successive fiscal
year by obtaining from the registrar a certificate of renewal. To obtain a certificate of
renewal, the licensee shall file with the registrar an application that includes a listing
of each project, contract, or subcontract completed by the licensee during the
preceding calendar year in this state over the amount of twenty-five thousand dollars
and the nature of the work of each project, contract, or subcontract. The registrar
shall within a reasonable time forward a copy of the list to the state tax
commissioner. The applicant shall include with the application a copy of a certificate
of liability insurance unless the registrar has a current valid certificate of insurance
on file, and a certification that the applicant has submitted all payroll taxes, including
North Dakota income tax, workforce safety and insurance premiums, and
unemployment insurance premiums due at the time of renewal, which documents
need not be notarized. 2. The registrar may refuse to renew a license if the registrar determines the
application contains false, misleading, or incomplete information or if the contractor's
license is not in good standing for any of the reasons listed in subsection 3 of section
43-07-04. The registrar shall notify the applicant in writing if the registrar does not
grant the license and shall provide the applicant an opportunity to respond to or cure
the defect in the application for a period of ten days from the date of the written
notification. An applicant aggrieved by a decision of the registrar not to grant the
license may appeal the decision to the district court of the applicant's county of
residence or Burleigh County. 3. The application for a certificate of renewal must be made to the registrar on or
before the first day of March of each year. At the time of filing the application for a
certificate of renewal, the applicant shall pay to the registrar a renewal fee equal to
twenty percent of the license fee established in section 43-07-07. If any contractor
applies for a renewal under a class different from the license previously issued, the
new class license may be issued upon the payment of the fee required for the
issuance of the license of the class applied for. If any contractor fails to file an
application for a certificate of renewal by the March first deadline, the contractor's
license is not in good standing and the contractor must be deemed to be unlicensed
within the meaning of sections 43-07-02 and 43-07-18. Within sixty days after March first, the contractor must be notified by mail that the contractor's license is not
in good standing. The contractor then has until June first to renew by paying a penalty fee of seventy-five percent of the renewal fee, filing an application for a
certificate of renewal, and paying the renewal fee. A contractor who applies for a
certificate of renewal before or within ninety days of the filing deadline is not subject
to the investigation authorized in section 43-07-09. After the June first deadline any
licenses not renewed are revoked. Any application for a certificate of renewal must
be fully completed within sixty days of the date the application is received by the
registrar or the registrar shall return the application to the contractor who then is
subject to section 43-07-09. The registrar may destroy all renewals provided for in
this section after they have been on file for six years. 43-07-11. Contractor's bond - Requirements. Repealed by S.L. 1995, ch. 397, § 9. 43-07-11.1. Contracts with state. 1. No contractor, resident or nonresident, is eligible to enter into a public contract with
any department of the state of North Dakota, nor any political or governmental Page No. 4 subdivision of the state until satisfactory showing is made that said contractor has
paid all delinquent income, sales or use taxes, if any, owed to the state pursuant to
the provisions of the income, sales or use tax laws, and which have been assessed
either by the filing of an income or sales and use tax return by the contractor, or by
an assessment of additional income, sales or use taxes against the contractor by the
commissioner that has become finally and irrevocably fixed, before the date that the
contract was executed by the parties thereto. "Contractor" and "public contract" have the same definition for purposes of this section as in chapter 43-07 relating to
issuance of licenses to contractors. 2. A certificate from and by the tax commissioner shall satisfy the requirement of
subsection 1. Upon failure to file such a certificate, such department or political or
governmental subdivision shall refuse to execute said public contract. 3. The provisions of this section apply only to contracts executed after July 1, 1965. 43-07-12. Bids to show license issued. All bids and proposals for the construction of any public contract project subject to the provisions of this chapter must contain a copy of the
license or certificate of renewal thereof issued by the secretary of state enclosed in the required
bid bond envelope. No contract may be awarded to any contractor unless the contractor is the
holder of a license in the class within which the value of the project falls as hereinbefore
provided. A contractor must be the holder of a license at least ten days prior to the date set for
receiving bids, to be a qualified bidder. A bid submitted without this information properly enclosed in the bid bond envelope may not be read nor considered and must be returned to the
bidder. This section does not apply to bids submitted: 1. To the department of transportation; 2. For use of municipal, rural, and industrial water supply funds authorized by Public
Law No. 99-294 [100 Stat. 418]; 3. To the public service commission; or 4. For use of federal aid highway funds authorized by Public Law No. 85-767 [72 Stat.
885; 23 U.S.C. 101 et seq.]. 43-07-13. Records and certified copies thereof. The registrar shall maintain in the registrar's office, open to public inspection during office hours, a complete indexed record of all
applications, licenses, certificates of renewal, revocations, and other information maintained on
contractors. The registrar may dispose of an inactive contractor file after two years if no attempts
have been made to apply for a new license or renew the license. Disposal of the license will
proceed according to the provisions of chapter 54-46. Before disposal and upon request, the
registrar shall furnish a certified copy of any information maintained upon receipt of the sum of
ten dollars. Such certified copy must be received in all courts and elsewhere as prima facie
evidence of the facts stated therein. 43-07-14. Complaint for license revocation - Consumer fraud action. 1. Any person may file a duly verified complaint with the registrar charging that the
licensee is guilty of any of the following acts or omissions: a. Abandonment of any contract without legal excuse after a deposit of money or
other consideration has been provided to the licensee. A rebuttable presumption of abandonment arises if: (1) A contractor fails substantially to commence any work agreed upon,
unless the failure is due to circumstances beyond the control of the
contractor: Page No. 5 (a) Within sixty days of a starting date agreed upon in writing; or (b) Within ninety days of the contract date if no starting date is agreed
upon in writing; or (2) A contractor fails to complete any work agreed upon in writing within
ninety days of a completion date agreed upon in writing, or within one
hundred eighty days of the contract date if no completion date is agreed
upon in writing, unless the failure is due to circumstances beyond the
control of the contractor. b. Diversion of funds or property received under express agreement for the
prosecution or completion of a specific contract under this chapter, or for a
specified purpose in the prosecution or completion of any contract, and their
application or use for any other contract obligation or purpose to defraud or
deceive creditors or the owner. c. Engaging in any fraudulent or deceptive acts or practices or misrepresentation
as a contractor in consequence of which one or more persons is injured in a
total amount exceeding three thousand dollars. d. The making of any false or misleading statement in any application for a license
or renewal or by violating this chapter or being convicted of an offense the
registrar determines has a direct bearing on the applicant's or licensee's ability
to serve the public as a contractor as set out in section 12.1-33-02.1. e. Engaging in work without any trade or professional license as required for the
work pursuant to local, state, or federal law. f. Failure to refund fully the contracting party's advance payment if a rebuttable
presumption of abandonment has arisen and the contracting party has made a
request to the licensee for a refund. 2. The complaint must be on a form approved by the registrar and must set forth
sufficient facts upon which a reasonable individual could conclude that any of the
acts or omissions in subsection 1 has been committed. 3. Any act or omission under this section may also constitute grounds for the attorney
general to bring an action under chapter 51-15 against the licensee or any
unlicensed person engaging in the business or acting in the capacity of a contractor
in violation of section 43-07-02 and subjects the licensee or any such unlicensed
person to all provisions, procedures, remedies, and penalties provided for in chapter
51-15. 43-07-15. Revocation or suspension of license - Restitution - Civil penalties - Appeal - Procedure. The registrar shall review each complaint filed under section 43-07-14. If
the registrar determines a written complaint filed under section 43-07-14 provides sufficient facts
upon which a reasonable person could conclude that one or more of the acts or omissions set
forth in section 43-07-14 has been committed, the registrar may initiate an adjudicative
proceeding in accordance with chapter 28-32. If, after an adjudicative proceeding or as part of an
informal disposition under chapter 28-32, the registrar determines that the licensee is guilty of an
act or omission charged or if the licensee admits guilt to an act or omission charged, the registrar
may suspend or revoke the contractor's license, order a civil penalty of not more than one
thousand dollars, order restitution in an amount not more than five thousand dollars, or impose
some lesser sanction or remedy. The registrar may suspend the contractor's license for a period
of not more than sixty months. The registrar may not renew, reinstate, or issue a new license
until the licensee has paid any civil penalty or restitution imposed under this section. The registrar may bring an action in district court to recover restitution or penalties under this section.
A contractor aggrieved by a decision of the registrar in revoking or suspending the contractor's Page No. 6 license or ordering restitution or penalties may appeal the decision to the district court of that
person's county of residence or Burleigh County. Any licensee may not obtain a license under
any name during the period of revocation or suspension. A "licensee" whose license is revoked
or suspended includes any officer, director, agent, member, or employee of the licensee. The
provisions of chapter 28-32 govern any appeal and proceedings hereunder. 43-07-16. Cancellation of license - Appeal. Repealed by S.L. 1963, ch. 304, § 16. 43-07-17. Revocation of license - Relicensing. A licensee whose license has been revoked may not be relicensed for a period of up to five years. 43-07-18. Penalty. Any person acting in the capacity of a contractor without a license is guilty of a class A misdemeanor. Whether a person is subjected to criminal prosecution under
this section, and in addition to the license fee that may be assessed when the person applies for
a license, the person may be assessed a civil penalty by the registrar, following written notice to
the person of an intent to assess the penalty, in an amount not to exceed three times the amount
set forth in section 43-07-07. Any civil penalty must be assessed and collected before a person
is issued a license. The assessment of a civil penalty may be appealed in the same manner as
appeals under section 43-07-04, but only on the basis that the registrar's administrative
determination that the person acted as a contractor when not licensed as a contractor was clearly
erroneous. 43-07-19. Nonresident contractors - Agent for service of process. Every applicant for a contractor's license who is not a resident of the state of North Dakota, by signing and filing
the application, appoints the secretary of state as the applicant's true and lawful agent upon
whom may be served all lawful process in any action or proceeding against such nonresident
contractor. Such appointment in writing is evidence of the contractor's consent that any such
process against the contractor which is so served upon the secretary of state shall be of the
same legal force and effect as if served upon the contractor personally within this state.
Registered foreign corporations entitled to do business in this state according to chapter 10-19.1,
registered foreign limited liability companies entitled to do business in the state according to
chapter 10-32, foreign limited liability partnerships entitled to do business in the state according
to chapter 45-22, and foreign limited partnerships entitled to do business in the state according to
chapter 45-10.2 and having a current registered agent and registered address on file in the
secretary of state's office need not appoint the secretary of state as agent for service of process
under this section. Within ten days after service of the summons upon the secretary of state,
notice of such service with the summons and complaint in the action shall be sent to the
defendant contractor at the defendant contractor's last-known address by registered or certified
mail with return receipt requested and proof of such mailing shall be attached to the summons.
The secretary of state shall keep a record of all process served upon the secretary of state under
this section, showing the day and hour of service. Whenever service of process was made under
this section, the court, before entering a default judgment, or at any stage of the proceeding, may
order such continuance as may be necessary to afford the defendant contractor reasonable
opportunity to defend any action pending against the defendant contractor. 43-07-20. Employment preference in contract. In all contracts, except those which involve federal-aid funds and when a preference or discrimination would be contrary to a federal
law or regulation, hereafter let for state, county, city, school district, or township construction,
repair, or maintenance work under any laws of this state, there shall be inserted a provision by
which the contractor must give preference to the employment of bona fide North Dakota
residents, as determined by section 54-01-26, with preference given first to honorably discharged
disabled veterans and veterans of the armed forces of the United States, as defined in section
37-19.1-01, who are deemed to be qualified in the performance of that work. The preference
shall not apply to engineering, superintendence, management, or office or clerical work. No contract shall be let to any person, firm, association, cooperative, corporation, or limited liability company refusing to execute an agreement containing the aforementioned
provisions. Page No. 7 43-07-21. Penalty - Injunction proceedings. Any person violating any provisions of section 43-07-20 is guilty of a class B misdemeanor. A repeated violation constitutes legal grounds for a court, on proper application by the labor commissioner, to grant an injunction
without requiring the posting of a bond or undertaking. 43-07-22. Enforcement responsibility. The labor commissioner has the primary responsibility of enforcing sections 43-07-20 and 43-07-21 and may make reciprocal agreements
or arrangements with any other state or territory exempting the application of sections 43-07-20
through 43-07-22, and may examine records of employment relative to public contracts for such
purposes. However, any person being adversely affected because of noncompliance with section 43-07-20 may also institute an appropriate civil action, and any person having knowledge
of a violation may file a criminal complaint with the proper official. 43-07-23. Allowable retention of estimates - Interest on retainage. Contracts entered between persons for the performance of work to be done by a contractor, except those contracts
subject to section 40-22-37 or 48-01.2-13, or contracts governed by federal statutes or
regulations which require other provisions with respect to retention, are subject to a maximum
retention on amounts due under the contract as follows: retention of ten percent of each estimate presented is allowable until such time as the project is fifty percent complete, with no
further retainage on estimates during the continuance of the contract. If the owner, governing
board, or authorized committee invests the retained estimate funds, the interest earned on those
retained funds is payable at the time of final payment on the contract to the contractor on whose
account the moneys were held. 43-07-24. Duty to supply license number when applying for building permit - Display of number. When applying for a building permit, a contractor shall supply the permit
issuing official that contractor's license number. That official shall enter those numbers on the
permit. A person performing general contractor's work on that person's own property, even if
exempt from the licensing requirements of this chapter, shall, when applying for a building permit,
supply the building permit issuing official the license number, as soon as available, of each
subcontractor engaged on the project and doing work covered by the permit. That official shall
enter each number so supplied before inspection of the work. 43-07-25. Licensed contractors' list. On request, the registrar shall provide city and county enforcement officials with a list of contractors licensed under this chapter. The registrar
shall also provide similar information to persons governed by section 43-07-24. Whenever the
registrar obtains information on the activities of a contractor doing business in this state of which
officials of workforce safety and insurance, job service North Dakota, or tax commissioner may
be unaware and that may be relevant to the duties of those officials, the registrar shall provide
any relevant information to those officials for the purpose of administering their duties. 43-07-26. Warranty repairs - Required notice. Before undertaking any repair, other than emergency repair, or instituting any action for breach of warranty in the construction of a
one-family or two-family dwelling, or an improvement with a value exceeding two thousand
dollars to a dwelling, the purchaser or owner shall give the contractor written notice by mail,
within six months after knowledge of the defect, advising the contractor of any defect and giving
the contractor a reasonable time to comply with this section. Within a reasonable time after
receiving the notice, the contractor shall inspect the defect and provide a response to the
purchaser or owner, and, if appropriate, remedy the defect within a reasonable time thereafter.
The contractor shall provide the purchaser or owner written notice of the requirements of this
section at the time of closing for the property or, in the case of an improvement, at the time of
completion of the improvement. For the purposes of this section, "reasonable time" means within thirty business days after the notice is mailed or any shorter period of time as may be
appropriate under the circumstances. Page No. 8 Document Outline chapter 43-07 contractors
Disclaimer: These codes may not be the most recent version. North Dakota may have more current or accurate information. We make no warranties or guarantees about the accuracy, completeness, or adequacy of the information contained on this site or the information linked to on the state site. Please check official sources.
This site is protected by reCAPTCHA and the Google
Privacy Policy and
Terms of Service apply.