C27 License Business Practices and Contract Law

Question 1

Under California law, what is the maximum deposit a contractor may collect from a homeowner at the start of a home improvement project?

Accepted Answer

10% of the contract price or $1,000, whichever is less

Answer

15% of the contract price or $1,500, whichever is less

Answer

25% of the total contract price

Answer

50% of the total contract price

Question 2

Which document must a California contractor provide to a homeowner before starting a home improvement project?

Accepted Answer

A written contract that includes a three-day right to cancel notice

Answer

A materials list only

Answer

A verbal agreement confirmed by email or text

Answer

A building permit application only

Question 3

What is the 'right to cure' provision in California contractor law?

Accepted Answer

The contractor's right to fix alleged defective work before the homeowner can pursue legal action

Answer

The contractor's right to substitute plant species without owner approval

Answer

The homeowner's right to cancel a contract within three business days

Answer

The contractor's right to adjust the contract price due to unforeseen material costs

Question 4

When must a California contractor include a Mechanics Lien Warning in a home improvement contract?

Accepted Answer

For all home improvement contracts regardless of the contract amount

Answer

Only for jobs exceeding $50,000 in value

Answer

Only when the contractor uses licensed subcontractors

Answer

Only for new construction projects on vacant land

Question 5

What must a C-27 contractor do if a project requires work outside the scope of the landscaping license?

Accepted Answer

Hire a licensed contractor holding the appropriate classification for that work

Answer

Self-perform the out-of-scope work if the value is minor

Answer

Apply to CSLB for a temporary expansion of license scope

Answer

Subcontract the work to unlicensed workers under direct supervision

Question 6

What is the minimum information required in a California contractor's written home improvement contract?

Accepted Answer

Contractor's license number, description of work, start and completion dates, and payment schedule

Answer

Just the total price and estimated start date

Answer

Only a materials list and hourly labor rate

Answer

The contractor's name and contact information only