SECTIONS 8700-8704 - California Statutes

CIVIL CODE

SECTION 8700-8704

8700. (a) This chapter applies if any of the following conditions
is satisfied:
(1) The owner of the fee interest in property contracts for a work
of improvement on the property with a contract price greater than
five million dollars ($5,000,000).
(2) The owner of a less than fee interest in property, including a
leasehold interest, contracts for a work of improvement on the
property with a contract price greater than one million dollars
($1,000,000).
(b) For the purpose of this section:
(1) The owner of the fee interest in property is not deemed to be
the owner of a less than fee interest by reason of a mortgage, deed
of trust, ground lease, or other lien or encumbrance or right of
occupancy that encumbers the fee interest.
(2) A lessee of real property is deemed to be the owner of a fee
interest in the real property if all of the following conditions are
satisfied:
(A) The initial term of the lease is at least 35 years.
(B) The lease covers one or more lawful parcels under the
Subdivision Map Act, Division 2 (commencing with Section 66410) of
Title 7 of the Government Code, and any applicable local ordinance
adopted under that act, in their entirety, including, but not limited
to, a parcel approved pursuant to a certificate of compliance
proceeding.

8702. This chapter does not apply to any of the following works of
improvement:
(a) A single-family residence, including a single-family residence
located within a subdivision, and any associated fixed work that
requires the services of a general engineering contractor as defined
in Section 7056 of the Business and Professions Code. As used in this
subdivision, "single-family residence" means a real property
improvement used or intended to be used as a dwelling unit for one
family.
(b) A housing development eligible for a density bonus under
Section 65915 of the Government Code.

8704. This chapter does not apply to any of the following owners:
(a) A qualified publicly traded company or a wholly owned
subsidiary of a qualified publicly traded company, if the obligations
of the subsidiary pursuant to the contract for the work of
improvement are guaranteed by the parent. As used in this
subdivision, "qualified publicly traded company" means a company
having a class of equity securities listed for trading on the New
York Stock Exchange, the American Stock Exchange, or the NASDAQ stock
market, and the nonsubordinated debt securities of which are rated
as "investment grade" by either Fitch ICBA, Inc., Moody's Investor
Services, Inc., Standard & Poor's Ratings Services, or a similar
statistical rating organization that is nationally recognized for
rating the creditworthiness of a publicly traded company. If at any
time before final payment of all amounts due pursuant to the contract
the nonsubordinated debt securities of the qualified publicly traded
company are downgraded to below "investment grade" by any of those
rating organizations, the owner is no longer exempt from this
chapter.
(b) A qualified private company or a wholly owned subsidiary of a
qualified private company, if the obligations of the subsidiary
pursuant to the contract for the work of improvement are guaranteed
by the parent. As used in this subdivision, "qualified private
company" means a company that has no equity securities listed for
trading on the New York Stock Exchange, the American Stock Exchange,
or the NASDAQ stock market, and that has a net worth determined in
accordance with generally accepted accounting principles in excess of
fifty million dollars ($50,000,000). If at any time before final
payment of all amounts due pursuant to the contract the net worth of
the qualified private company is reduced below that level, the owner
is no longer exempt from this chapter.