A Home Improvement Salesperson sells a $15,000 roofing contract. The salesperson's registration expires during the 3-day cancellation period. What is the legal status of the contract?
Correct Answer
B) Contract is void and unenforceable
Contracts sold by unregistered salespersons are void and unenforceable under B&P Code Section 7153.2. The registration must be current when the sale is made.
Why This Is the Correct Answer
Under B&P Code Section 7153.2, a home improvement contract is void and unenforceable if sold by an unregistered Home Improvement Salesperson. Registration must be current at the time of sale. If the registration expires during the 3-day cancellation period, the sale was valid when made, but once the registration lapses, the legal status of the contract becomes void and unenforceable.
Why the Other Options Are Wrong
Option A: Contract is valid and enforceable
The contract is not valid and enforceable because the salesperson's registration lapsed. California law strictly requires active registration throughout the sales process. An expired registration renders the contract unenforceable.
Option C: Contract requires re-signing with new salesperson
There is no provision requiring re-signing with a new salesperson to salvage a void contract. Once voided by the lapse in registration, the contract cannot be cured by substituting another salesperson.
Option D: Contract is valid if customer doesn't cancel
The homeowner's decision not to cancel does not validate a contract sold by an unregistered salesperson. The law does not allow this cure — the contract's enforceability depends on the salesperson's registration status, not the customer's choice.
Memory Technique
Think: 'No active badge, no valid contract.' The registration is like a badge — if it expires mid-transaction, the deal is off. The 3-day period is there to protect consumers, but an expired registration voids the contract independently.
More California Questions
A Class C-10 electrical contractor has annual gross receipts of $3.2 million. What is the required bond amount under current California law?
Under B&P Code Section 7125.4, what is the fee for initial Home Improvement Salesperson registration?
According to B&P Code Section 7125, what is the maximum penalty the CSLB can impose for contracting without a license?
A home improvement contract for $8,500 requires a 3-day right to cancel notice. The contract is signed on Tuesday at 2 PM. When does the cancellation period expire?
A contractor employs 15 workers across multiple job sites. The total annual payroll is $850,000 with a workers' comp rate of 4.1%. If they self-insure with a deposit requirement of 125% of estimated annual premium, what deposit is required?
A C-10 electrical contractor wants to perform plumbing work valued at $8,000 as part of a larger electrical project. Is this permissible under CSLB regulations?
A homeowner discovers that an unlicensed contractor performed $25,000 worth of work on their property. Under B&P Code Section 7031, what remedy is available to the homeowner?
A Class B general building contractor wants to perform electrical work valued at $750. According to the B&P Code, this contractor:
A contractor's qualifying individual leaves the company. How many days does the contractor have to replace them before the license becomes invalid?
According to B&P Code Section 7031, what happens to a contractor's right to payment if they perform work while unlicensed?
People Also Study
Business & Financial Management
120 questions · 70% to pass
Contract Administration
60 questions · 70% to pass
Project Management
60 questions · 70% to pass
Related Study Resources
Previous Question
A C-20 warm air heating contractor receives a contract for $45,000 to install HVAC equipment and $8,000 for related electrical connections. This contractor:
Next Question
A Class B contractor wants to subcontract electrical work exceeding $500 to a Class C-10 electrical contractor. What is required under California law?