Free C-10 Practice Questions: Contracts & Change Orders

A change order becomes part of the contract only when prepared in writing and signed by the parties prior to commencement of the changed work.

Source: B&P §7159

Civil Code 900: as to fit and finish items, a builder shall provide a homebuyer with a minimum one-year express written limited warranty covering cabinets, mirrors, flooring, interior and exterior walls, countertops, paint finishes, and trim.

Source: Civil Code §900

The Notice of Cancellation in Civil Code 1689.7 tells the buyer: you may cancel this transaction, without any penalty or obligation, within three business days.

Source: Civil Code §1689.7

BPC 7030.5 says every licensee shall include the license number in all construction contracts, subcontracts and calls for bid, and all forms of advertising, as prescribed by the registrar. An ad without it breaks that rule.

Source: B&P §7030.5

The CSLB law book says CSLB offers two free arbitration programs, and when the alleged damages are less than $25,000, CSLB can order the contractor into a mandatory CSLB arbitration; disputes between $25,000 and $50,000 go to the voluntary program.

Source: CSLB Law Book p.72

The statute sets the qualifying threshold at twenty-five dollars ($25) or more, including any interest or service charges.

Source: Civil Code §1689.5

BPC 7159.14 says a service and repair contractor shall charge only one service charge, and a service charge includes charges such as a service or trip charge, or an inspection fee.

Source: BPC 7159.14

Cancellation rights run from when the buyer receives the signed and dated copy of the contract, which the contractor must provide before work starts.

Source: Civil Code §1689.6 / B&P §7159

BPC 7159 says a change-order form for changes or extra work becomes part of the contract only if it is in writing and signed by the parties prior to the commencement of any work covered by the change order.

Source: B&P §7159

Civil Code §938 states the title applies only to new residential units where the purchase agreement with the buyer was signed by the seller on or after January 1, 2003. It does not cover commercial buildings, mere remodels/additions, or rental disputes.

Source: Civil Code §938

BPC 7159 says a change order becomes part of the contract only if it is in writing and signed by the parties prior to the commencement of any work covered by the change order.

Source: B&P §7159

The buyer must take reasonable care of the goods before cancellation and during the 20-day period, but the goods remain at the seller's risk while awaiting reclamation.

Source: Civil Code §1689.11

BPC 7159.5 caps the downpayment at one thousand dollars ($1,000) or 10 percent of the contract amount, whichever amount is less. 10 percent of $50,000 is $5,000, which is more than $1,000, so $1,000 is the limit.

Source: B&P §7159.5

Civil Code 1598: where a contract has but a single object, and that object is unlawful, whether in whole or in part, the entire contract is void.

Source: Civil Code §1598 / §1667

Civil Code 1550: it is essential to the existence of a contract that there should be parties capable of contracting, their consent, a lawful object, and a sufficient cause or consideration.

Source: Civil Code §1550

BPC 7085 says the registrar may, with the concurrence of both the licensee and the complainant, refer the alleged violation and any dispute between them to arbitration.

Source: CSLB dispute resolution

BPC 7159 says a change order is not enforceable against a buyer unless it identifies in writing, before the work starts, the scope of work, the amount to be added or subtracted, and the effect the order will make in the progress payments or the completion date.

Source: B&P §7159

BPC 7027.2 lets a person who is not licensed advertise for construction work only if the aggregate contract price is less than one thousand dollars ($1,000) and the person states in the advertisement that the person is not licensed.

Source: B&P (unlicensed advertising disclosure)

Civil Code 1605: any benefit conferred, or agreed to be conferred, upon the promisor, to which the promisor is not lawfully entitled, or any prejudice suffered by the other person, as an inducement to the promisor, is good consideration for a promise.

Source: Civil Code §1550 / §1605

Civil Code 941(a): except as specifically set forth in the title, no action may be brought to recover under it more than 10 years after substantial completion of the improvement.

Source: Civil Code §941(a)

A covered home-improvement buyer may cancel until midnight of the third business day.

Source: Civil Code §1689.6(a); B&P §7159

Civil Code 1689.6(a)(2) gives the buyer the right to cancel until midnight of the third business day, or the fifth business day if the buyer is a senior citizen, after the buyer receives a signed and dated copy of the contract.

Source: Civil Code §1689.7 (3-day cancellation)

The contract must include the statutory notice headed 'Mechanics Lien Warning.'

Source: B&P §7159

The contractor must provide a copy signed and dated by both parties before work starts.

Source: B&P §7159

BPC 7159.5: if a downpayment will be charged, it shall not exceed one thousand dollars ($1,000) or 10 percent of the contract amount, whichever amount is less.

Source: B&P §7159.5

A service and repair contract requires that the buyer initiated contact and that no payment is due or accepted until the work is completed (no down payment).

Source: B&P §7159.10

BPC 7159 requires the heading "Schedule of Progress Payments," and each progress payment must be stated in dollars and cents and specifically reference the amount of work or services to be performed and materials and equipment to be supplied.

Source: B&P §7159

Before work starts, the contractor must give the buyer a copy signed and dated by both parties.

Source: B&P §7159

BPC 7159.5: except for a downpayment, the contractor shall neither request nor accept payment that exceeds the value of the work performed or material delivered.

Source: B&P §7159 / §7159.5

BPC 7159.5 caps the downpayment at one thousand dollars ($1,000) or 10 percent of the contract amount, whichever amount is less. 10 percent of 8,000 dollars is 800 dollars, which is less, so 800 dollars is the limit.

Source: B&P §7159.5

Civil Code 1556: all persons are capable of contracting, except minors, persons of unsound mind, and persons deprived of civil rights.

Source: Civil Code §1556

Civil Code 1624(a), the Statute of Frauds, says the contracts it lists are invalid unless they, or some note or memorandum of them, are in writing and subscribed by the party to be charged or that party's agent.

Source: Civil Code §1624

BPC 7159 requires the heading "Description of the Project and Description of the Significant Materials to be Used and Equipment to be Installed," followed by a description of the project and of the significant materials to be used and equipment to be installed.

Source: B&P §7159

A home solicitation/home improvement buyer may cancel until midnight of the third business day after receiving a signed, dated copy of the contract.

Source: Civil Code §1689.6 / B&P §7159

A mailed cancellation is effective when properly addressed and deposited with prepaid postage — not when received.

Source: Civil Code §1689.6(e)

The contract must state approximate start and completion dates.

Source: B&P §7159

BPC 7159.2 says no home improvement contract of a value of five thousand dollars ($5,000) or less shall provide for a security interest in real property, except for a mechanic's lien or other interest in property that arises by operation of law.

Source: BPC 7159.2

BPC 7159(d) requires the heading "Contract Price," followed by the amount of the contract in dollars and cents.

Source: B&P §7159

CCP 116.221: the small claims court has jurisdiction in an action brought by a natural person if the amount of the demand does not exceed twelve thousand five hundred dollars ($12,500).

Source: Code of Civil Procedure §116.221

BPC 7091 defines a "latent act or omission" as an act or omission that is not apparent by reasonable inspection.

Source: CCP §337.15(b)

The cancellation period starts when the buyer receives the signed and dated contract copy containing the required notice.

Source: B&P §7159; Civil Code §1689.6

CCP 337(a): an action upon any contract, obligation or liability founded upon an instrument in writing must be brought within four years.

Source: CCP §337

Civil Code 910: before filing an action for a violation of the Chapter 2 standards, the claimant shall initiate prelitigation procedures, starting with written notice to the builder by certified mail, overnight mail, or personal delivery.

Source: Civil Code §910 (with §§916–918 inspection/offer to repair)

The contract must state the contractor's name, business address, and license number.

Source: B&P §7159

CCP 337.1(a): no action may be brought for a patent deficiency more than four years after the substantial completion of the improvement.

Source: CCP §337.1(a)

BPC 7159.5 says the contract amount includes the entire cost, including profit, labor, and materials, but excluding finance charges, and a separate finance charge shall be set out separately from the contract amount.

Source: BPC 7159.5

Civil Code 1689.6(a)(2) extends the right to cancel to midnight of the fifth business day if the buyer is a senior citizen, and 1689.5(f) defines a senior citizen as an individual who is 65 years of age or older.

Source: Civil Code §1689.6

Civil Code 1671(b): a provision in a contract liquidating the damages for the breach of the contract is valid unless the party seeking to invalidate it establishes that it was unreasonable under the circumstances existing when the contract was made.

Source: Contract law (liquidated damages)

BPC 7159.5: the downpayment shall not exceed one thousand dollars ($1,000) or 10 percent of the contract amount, whichever amount is less.

Source: B&P §7159.5 / §7159(d)(8)

BPC 7159.5 caps the downpayment at one thousand dollars ($1,000) or 10 percent of the contract amount, whichever amount is less. 10 percent of $30,000 is $3,000, which is more than $1,000, so $1,000 is the limit.

Source: B&P §7159.5

A home improvement contract must be in writing and signed by the parties before work begins.

Source: B&P §7159

BPC 7159.5 requires the contractor, if requested, to furnish a full and unconditional release from potential lien claims for any portion of the work that has been paid for, and the homeowner may withhold all further payments until these releases are furnished.

Source: BPC 7159.5

BPC 7031(a) bars a contractor from suing to collect compensation for work that requires a license without alleging they were duly licensed at all times during the work. 7031(b) lets a person who used an unlicensed contractor sue to recover all compensation paid to that contractor.

Source: B&P §7031

BPC 7159 says a change-order form for changes or extra work becomes part of the contract only if it is in writing and signed by the parties prior to the commencement of any work covered by the change order.

Source: B&P §7159 (change orders)

Civil Code 1689.6(d): cancellation occurs when the buyer gives written notice of cancellation to the seller at the address or email address specified in the agreement. A phone call is not written notice.

Source: Civil Code §1689.6(d)

BPC 7159.5 caps the downpayment at one thousand dollars ($1,000) or 10 percent of the contract amount, whichever amount is less. 10 percent of 5,000 dollars is 500 dollars, which is less, so 500 dollars is the limit.

Source: B&P §7159.5

Change orders must be written and signed by the parties before the changed/extra work starts.

Source: B&P §7159

The period is measured in business days and runs until midnight of the third business day after the day the buyer signs the agreement, not by calendar days.

Source: Civil Code §1689.6(a)

CCP 337.1(e) defines a "patent deficiency" as a deficiency which is apparent by reasonable inspection.

Source: CCP §337.1(e)

Civil Code 1689.6(c) lets the buyer cancel a contract for the repair or restoration of residential premises damaged by a disaster until midnight of the seventh business day after the buyer signs and dates the contract.

Source: Civil Code §1689.6(c) (declared emergency)