Arkansas General Assembly passes Senate Bill 364 on contractor violations

On April 15, 2025, the Arkansas State Legislature introduced Senate Bill 364, aimed at amending existing laws concerning violations and penalties related to contractors. The bill, sponsored by Senator Hester and Representative Womack, seeks to clarify the legal recourse available to contractors who may find themselves in violation of state regulations.

The primary provision of Senate Bill 364 modifies Arkansas Code § 17-25-103(d), which governs actions brought in law or equity for violations related to contractor agreements. Under the current law, contractors who enter into contracts in violation of the chapter are barred from seeking legal remedies. However, the proposed amendment introduces a significant change: it allows contractors to pursue claims for unjust enrichment or quantum meruit, provided they meet specific conditions. These conditions include timely payment of any fines assessed by the regulatory board and proper application for a contractor's license.

The introduction of this bill has sparked discussions among lawmakers and industry stakeholders. Proponents argue that the amendment provides a necessary safety net for contractors who may inadvertently violate regulations, allowing them to recover costs for work performed. Critics, however, express concerns that this could encourage non-compliance with licensing requirements, potentially undermining the integrity of the contracting profession.

The economic implications of Senate Bill 364 are noteworthy. By enabling contractors to seek compensation even after violations, the bill may foster a more flexible business environment. However, it also raises questions about accountability and the enforcement of licensing laws, which are designed to protect consumers and ensure quality in construction services.

As the bill progresses through the legislative process, its potential impact on the contractor industry and regulatory framework in Arkansas remains a focal point of debate. Stakeholders are closely monitoring developments, as the outcome could reshape the landscape for contractors operating within the state. The bill is scheduled for further discussion in upcoming sessions, where lawmakers will weigh the benefits against the risks associated with these proposed changes.