The city stopped demolition work this week on the old John Muir schoolhouse after The Bee, (The Local Newspaper) raised questions about the company hired to do the work.

Stockton-based Don Lawley Co. Inc. had its license suspended by the Contractors State License Board because it doesn't have a qualified owner or employee designated as having passed state licensing requirements, according to the board.

Julie G. Hannon, acting director of parks, recreation and neighborhoods for the city, said the company learned only last Thursday that it didn't have a license.

Nonetheless, on Friday, a three-man crew from Don Lawley Co. began knocking down the two-story school's brick walls. Crews still were on the job Monday morning after The Bee placed a call to the city asking about the license.

"We're concerned about the whole issue," Hannon said after the city stopped the work. "At this point, we're checking into the site ... and as of today (Monday) there will not be any more work until we get to the bottom of this. They'll need to get a (valid) contractors license in order to start again."

She said the company contacted the city late Thursday about its license, but that information did not reach the right channels until Monday, when she learned about it and, after consulting with other officials, stopped the job.

Officials at Don Lawley Co. did not respond to requests for comment.

A search of the licensing board's Web site shows that in June, the company's then-chief executive officer and president, Donald Ray Lawley, died. He was the state-qualified person. The company had 90 days to find another licensed person or seek an extension to finish existing jobs but did neither, said Rick Lopes, spokesman for the licensing board.

The contract awarded Feb. 5

"They have 90 days to notify us and 90 days to request an extension to finish jobs currently in place, and they have not done either of those things," Lopes said. "It is very surprising."

He said the license presumably went into suspension in September and that the company would have been notified.

The City Council awarded the company a $58,848 demolition contract Feb. 5 because it submitted the lowest of three bids. The historic 1923 building was badly damaged by fire in October, and a city review determined it had to be torn down.

Hannon said the company had self-certified that it was licensed. Typically, she said, the city verifies licensing information about contractors, but in this case, that did not take place because the company said it was licensed.

It is unclear how Lawley's lapsed license could affect the city. Under the law, the city doesn't have to pay for the work, Lopes said.

But depending on how Don Lawley Co.'s insurance policy is written, the city could have potentially been on the hook for accidents, had they occurred, said attorney Kevin Culhane, an adjunct professor at McGeorge School of Law in Sacramento.

"When you are talking about the absence of a license, the issue would become a matter of getting ahold of the insurance files; but typically, you will see a requirement on insurance about maintaining a license 'in good standing,' " he said.

"Obviously, I haven't seen the policy, but that is something I would be looking for if I was the city."

Hannon said the city is looking at those types of issues.