3.3 Displaying the License and Advertising Rules

The License Number on Contracts

Maryland law treats the MHIC license number as the homeowner's primary protection, so the number must be visible at every point where the contractor touches the public. The first and most fundamental location is the home improvement contract itself. Every home improvement contract must contain the contractor's name, address, telephone number, and MHIC license number. A contract missing any of these is a violation in its own right — under the Commission's civil penalty schedule (COMAR 09.08.06.02), failure to include the name, address, telephone number, and license number on a contract draws a $500 penalty for a first violation and $1,500 for each subsequent violation.

There is a second contract-display rule that the exam loves: if a salesperson solicited the sale, the salesperson's name and license number must also appear on the contract. The logic traces back to Section 3.1 — a salesperson is licensed to sell for a specific employing contractor, and the contract must document who actually solicited the homeowner. A contract that shows only the company and omits the soliciting salesperson's name and number is incomplete.

Advertising Rules

Maryland regulates advertising by home improvement contractors, and two principles govern it:

1. Identification. Advertisements are expected to identify the licensed business — the Commission's penalty schedule includes a specific violation for failure to include the name or license number in an advertisement: $100 for a first violation and $300 for each subsequent violation.
2. Truthfulness. Ads must not be false, misleading, or deceptive. Publishing a false, misleading, or deceptive advertisement is penalized more heavily: $300 for a first violation and $1,000 for each subsequent violation.

Notice the asymmetry — forgetting the license number is the cheaper mistake; lying in an ad costs three times as much on a first offense. Exam questions frequently present these two penalty tiers side by side and ask which conduct triggers which fine.

Vehicle Display (COMAR 09.08.01.06)

The vehicle rule is the most mechanically specific display requirement, and every element of it is testable:

Two boundary rules matter as much as the display itself. First, "performance of home improvement work" expressly includes transporting materials to and from the jobsite — a pickup truck that hauls lumber and drywall must carry the display even though no one swings a hammer from it. Second, the definition excludes sales work: a vehicle used purely for sales calls is not required to carry the display. A classic exam scenario contrasts the estimator's sedan (sales work — no display required) with the crew's materials truck (performance of work — display required).

Subcontractors get their own rule: while performing work as a subcontractor, they display only their own license number — not the general contractor's. And failure to display the license number on a vehicle carries a $100 penalty for a first violation and $300 for each subsequent violation.

Notification Duties That Pair With Display Rules

Display compliance has an administrative twin: keeping the Commission informed, so that the number being displayed always resolves to accurate records. Two notification duties carry their own penalty tiers under COMAR 09.08.06.02 and regularly appear in scenario questions:

• Hiring or terminating a salesperson. The contractor must notify the Commission when it hires or terminates a salesperson — the same linkage created by the Employing Contractor Affidavit in Section 3.1. Failure to notify: $500 first violation, $1,000 subsequent.
• Changes to the licensed business. The contractor must notify the Commission within 10 days of any change of ownership, management, address, or trade name. Failure to notify: $500 first violation, $1,000 subsequent.

The 10-day window is the quotable detail. A contractor who moves the office, rebrands the trade name, or changes managers and keeps advertising under the old information is simultaneously breaking the notification rule and drifting toward the "acting under a name other than that on the license" violation described below.

License-Lending and Identity Traps

Three related prohibitions round out this topic, and they appear on the exam as integrity scenarios:

• Using another person's license. Only the licensee may operate under a license number. An unlicensed individual who performs work under a friend's or relative's MHIC number is acting as a contractor without a license — penalized at $1,500 for a first violation and $5,000 for each subsequent violation under the penalty schedule.
• Lending a license. The licensed person who permits the borrowing is equally exposed; a license is personal to the individual or company that qualified for it and cannot be rented out.
• Operating under a different name. Acting as a contractor or selling a home improvement under a name other than the name on the license is its own listed violation: $500 for a first violation and $1,500 for each subsequent violation. The name on the truck, the ad, and the contract must match the name on the license.

Worked Scenario

A licensed contractor prints yard signs reading "Best Price Roofing — Call 555-0100" with no company name matching the license and no MHIC number, drives an unmarked van loaded with shingles to the jobsite, and signs a contract that omits the license number. Three separate violations exist: the misleadingly unidentifiable advertisement, the missing vehicle display (hauling materials is performance of work), and the incomplete contract. The exam expects you to count and classify violations like these independently — one job, three distinct offenses, each with its own penalty tier.