Unlicensed Property Manager Providing Range Of Services May Sue To Recover For Portions Of Services Not Requiring A License
Other posts on this blog have discussed the very harsh treatment that unlicensed contractors receive under California law. Other types of licensees receive more favorable treatment. For example, in MKB Management, Inc. v. Melikian, the California Court of Appeal ruled that a property management firm’s lack of a real estate broker’s license did not automatically preclude any lawsuit to collect the firm’s fees.
In MKB Management, a property management company was party to a contract with an apartment building owner. The management firm provided a range of services. Some, including leasing apartment units and collecting rents, required a real estate broker’s license. Other services, including maintenance and decoration, did not require a broker’s license. When that management company sued the owner for fees due under the contract, the trial court dismissed the lawsuit because the management company did not have a broker’s license.
The Court of Appeal reversed the trial court’s dismissal. The MKB Management Court concluded that even though there was a single contract, the trial court had discretion to permit the management company to sue for the fees owed for services not requiring a broker’s license. Thus, the lack of a broker’s license did not automatically preclude the property management firm from suing to recover a portion of its fees.