Holland v. Morse Diesel International
- P was an African American unlicensed subcontractor who was contracted to provide cleanup services for D for a fixed price.
- P alleged that D discriminated against him because of his race by ridiculing him in front of other workers and by not paying him while they paid unlicensed white subcontractors.
- D refused to pay P and broke their contract because of "incomplete performance".
- P sued D for failure to pay and for racial discrimination.
- P brought case before lower court 3 times. All were dismissed on demurrer.
- CA Court of Appeals reversed, found that D could sue for racial discrimination, not for failure to pay.
- Is a contract enforceable when the services rendered are done so illegally because of lack of license.
- A contract is not enforceable when the services rendered are done so illegally because of lack of license.
- The purpose of the licensing law is to protect the public from incompetence and dishonesty in those who provide building and construction services.
- Section 7031 of the Business and Professions Code of CA advances this purpose by withholding judicial aid from those who seek compensation for unlicensed contract work.
- The public policy involved is that the state wants to discourage people who have failed to comply with the licensing laws from offering or providing their unlicensed services for pay.
- The importance of deterring unlicensed persons from engaging in the contracting business outweighs any harshness between the parties.
- Public policy was a big concern here. (public protection through having only licensed contractors be able to form enforceable contracts for services rendered)