According to Business and Professions Code Section 7159, which of the following home improvement contracts must be in writing?
Correct Answer
C) All contracts over $500
Business and Professions Code Section 7159 requires that all home improvement contracts exceeding $500 must be in writing and contain specific mandatory provisions. Contracts of $500 or less may be oral, but written contracts provide better protection for both parties and help avoid disputes.
Why This Is the Correct Answer
B&P Section 7159 requires all home improvement contracts exceeding $500 (combined labor and materials) to be in writing and include specific mandatory disclosures. This threshold was established to protect consumers from informal, unenforceable agreements on significant residential work while exempting minor, low-cost jobs from excessive administrative burden.
Why the Other Options Are Wrong
Option A: All contracts over $750
$750 is not the statutory threshold under B&P 7159. There is no California law that sets $750 as the written contract trigger for home improvement work.
Option B: All contracts regardless of amount
Requiring all contracts regardless of amount would be overly burdensome for very minor repairs and does not reflect the statutory language. B&P 7159 explicitly ties the written requirement to the $500 threshold.
Option D: All contracts over $200
$200 is below the $500 threshold established in B&P 7159. Oral contracts for work under $500 are permissible under California law (though written contracts are always advisable for clarity and dispute avoidance).
Memory Technique
Dual role of $500: below $500 you don't need a license AND you don't need a written contract. Above $500 you need both. Think of $500 as the 'formality line' — once you cross it, everything must be formal and documented.
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