Despite video evidence, contractor failed to show it had a 'bona fide responsible managing employee'

Under the Contractors State License Law, a limited liability company could be licensed through the qualification of a responsible managing employee (RME) and certain other individuals affiliated with the company. Its license would be automatically suspended if the RME disassociated without a replacement within 90 days.

An RME should be a bona fide employee, meaning an employee that the company permanently employed, and should be actively engaged in the work for which the company had a license. To be actively engaged, the employee should work 32 hours weekly or 80% of the total hours per week that the company’s business was in operation, whichever was less.

The case of Vascos Excavation Group LLC v. Gold involved a contract between the plaintiff, Vascos Excavation Group LLC, and the defendant, an owner of property in Pacific Palisades. The written agreement required Vascos to perform excavation, grading, and concrete work at the defendant’s property. The contract had an arbitration clause.

A dispute arose regarding the amount that the defendant owed Vascos under the contract. Vascos brought a complaint to enforce the mechanics lien. The defendant filed a petition to compel arbitration. The trial court issued an order compelling the parties to arbitrate.

During arbitration, the defendant argued that Vascos was barred from seeking compensation since it was not a duly licensed...

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