Pincetich v. Nolan

ORS 701.131(2)(c) applies to construction defects and services contributing to the defects, and does not include the failure to make payments on work performed.

Pincetich appealed the trial court's summary judgment order. Nolan agreed to pay Pincetich $286,271 to construct a residence. When Pincetich began performance, he was licensed by the Construction Contractor’s Board but his license was suspended for 14 days while he was without liability insurance. Pincetich sued Nolan claiming that he had not been paid for his construction work, and Nolan counterclaimed and offered the affirmative defense that ORS 701.131(1) barred Pincetich’s claim because he failed to maintain his contractor’s license throughout the performance of the contract. The trial court granted partial summary judgment in favor of Nolan and dismissed Pincetich’s claims. Pincetich appealed claiming that he falls within an exception under ORS 701.131(2)(c) because Nolan is a developer who was providing the service of payment for work within the meaning of the statute. The purpose of the exception is to allow third party claims for construction defects so that contractors can recover amounts from other responsible parties and make the consumer whole, in furtherance of the overarching goal of Chapter 701 in protecting the consumer. The Court held that ORS 701.131(2)(c) applies to construction defects and services contributing to the defects. Allowing Pincetich to use this exception is contrary to the purpose of the statute. Affirmed.