A homeowner pays a $5,000 down payment on a $20,000 roofing contract. The contractor begins work but abandons the project after completing only $1,500 worth of work. Under California law, what amount must the contractor return?
Correct Answer
B) $3,500
The contractor must return the down payment minus the value of work actually performed: $5,000 - $1,500 = $3,500 must be returned to the homeowner.
Why This Is the Correct Answer
The contractor received $5,000 but only delivered $1,500 in value. The homeowner is entitled to the return of all money paid minus the fair value of work actually and properly completed: $5,000 − $1,500 = $3,500. This is a straightforward unjust enrichment / breach of contract calculation. The contractor cannot keep funds for work never performed.
Why the Other Options Are Wrong
Option A: $1,500
$1,500 is the value of work the contractor performed, not the amount to be returned. Returning only $1,500 would leave the contractor with $3,500 they did not earn (since $5,000 − $1,500 = $3,500 unearned). Confusing 'value of work done' with 'amount to return' is a classic arithmetic trap.
Option C: $4,500
$4,500 would be the refund if the contractor had performed only $500 of work ($5,000 − $500 = $4,500). This distractor tests whether candidates can correctly identify $1,500 as the value of work completed and subtract it properly.
Option D: $5,000
$5,000 would be the correct refund only if the contractor had performed zero work. Since $1,500 of work was legitimately completed and delivered, the contractor is entitled to retain that portion. Returning the full $5,000 would unjustly enrich the homeowner.
Memory Technique
Refund Formula: 'Money In minus Work Done = Money Back.' $5,000 in the door, $1,500 of work done, so $3,500 walks back out. Draw a simple ledger: Credits (paid) vs. Debits (work performed) — the balance owed is the refund.
More California Questions
A homeowner signs a $15,000 home improvement contract on Monday at 2 PM at the contractor's office. Under California law, what is the latest time the homeowner can cancel the contract without penalty?
A swimming pool contract for $28,000 is signed on Wednesday at the customer's home. The contract includes proper cancellation notices. If the customer wants to cancel, they must do so by when?
Under California's prompt payment law, if a contractor submits a proper payment request to a property owner, payment is due within how many days?
A general contractor hires a subcontractor for $22,000. The general contractor receives payment from the owner but fails to pay the subcontractor within how many days, subjecting themselves to penalty interest?
Under California Civil Code Section 8180, when must a subcontractor serve a preliminary notice on a private work project?
Which of the following contracts is NOT subject to the 3-day right to cancel under California law?
A subcontractor completes roofing work on Tuesday, March 15th. The general contractor is paid by the owner on Friday, March 25th. Under California prompt payment laws, what is the latest date the general contractor must pay the subcontractor?
A contractor receives a progress payment of $18,000 from a property owner on Monday. The contractor owes subcontractors $12,000 of this amount. By what day must the contractor pay the subcontractors?
A swimming pool contractor enters into a $45,000 contract to install an in-ground pool. The contract includes a $5,000 down payment. What is the maximum down payment the contractor can legally collect under California law?
A contractor completes $15,000 worth of electrical work on a commercial building. The property owner disputes $3,000 of the charges. Under California prompt payment law, what amount must the owner pay within the required timeframe to avoid penalties?
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