Engaging in Contracting as a Business Organization

Section 489.105(13), Florida Statutes defines a “Business Organization” as “any partnership, corporation, business trust, joint venture, or other legal entity which engages or offers to engage in the business of contracting or acts as a contractor as defined in this section.”

This definition is used in Section 489.119(2) of the Statute as follows: “If the applicant proposes to engage in contracting as a business organization, including any partnership, corporation, business trust, or other legal entity, or in any name other than the applicant’s legal name or a fictitious name where the applicant is doing business as a sole proprietorship, the applicant must apply for registration or certification as the qualifying agent of the business organization.”

Effective October 1, 2009, the Department of Business and Professional Regulation eliminated the requirement for a separate business license for construction companies in Florida. However, contractors are still required to qualify construction businesses with their license and provide background information for the business that they are seeking to qualify. The name of the qualified business will continue to be placed on the contractor’s license, but the Certificate of Authority issued to the business is no longer regarded as a license. 

The qualifying agent has the responsibility to supervise, direct, manage and control construction activities on a job for which he has obtained the building permit on behalf of the Business Organization. The qualifying agent has a statutory duty to supervise all field work and said duty is non-delegable. The qualifying agent is also responsible to the Construction Industry Licensing Board for the financial matters of the Business Organization being qualified. Among other things, the application for qualifying agents must include an affidavit that the applicant has final approval authority on all payments, and on all approval of authority for construction work done by the business. The only way for a qualifying agent of a business to eliminate responsibility for the financial matters of the business is for there also to be an approved Financial Responsible Officer. When there is a Financial Responsible Officer for the business, the qualifying agent is relieved from all financial responsibilities.

There may also be a “Secondary Qualifying Agent” for the business. The Secondary Qualifying Agent is not responsible for the supervision of financial matters. The Secondary Qualifying Agent is only responsible for supervising field work at sites where he pulled the permit and for any other work for which he accepts responsibility.   

Business organizations must keep in mind that if its qualifying agent terminates his affiliation with the business, the business cannot engage in further contracting until it obtains a new qualifying agent. The business is not the holder of the license and therefore cannot act as a contractor without a qualifier.