I am a California licensed contractor. I have enjoined a foreign LLP for breach of contract , foreclosure of mechanics lien and lost profits the LLP (the ca. property owner in question) has crossed for breach and fraud. As a licensed contractor it is imperative that I maintain Workers comp insurance for the duration of the project less being barred from bringing the suite as well as possibly having to pay back the funds received under the contract.. I am clear and clean on this issue but the LLP is not. They inappropriately took away a portion of my work, thus the cause of action for lost profits, and while completing the work they took away from me, admitted during discovery that they had employees working on the project and no WC insurance. The question is "does the gate swing both ways on the requirement for workers comp insurance (obviously does) and are they somehow barred from bringing their cross complaint against me due to the lack of insurance thereof??? remember they are the building owner!
They are certainly required to keep WC on all employees (although not on the partners or officers of the LLP). The question of whether or not their counterclaims can be barred due to the lack of WC insurance is one for the judge. It is certainly worth raising. I won on a similar issue in another state with that claim, and the contractor could not file any counterclaims against my client due to their own breaches of the licensed contractor statute. It could work the same for you due to breach of the WC requirements. However, if you are representing yourself, do your research carefully. Find case law that supports your theory, and a key point of the decision will hinge upon the rationale behind the WC statute (i.e. if the reason for the law somehow impacts you, then there is a better chance that you will win with your argument to bar their counterclaims). BotXXX XXne is that there is no "sure thing" in the law, but this is a viable claim that you should raise and if you do your research and find support for your position you could very likely win.
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