According to Business and Professions Code Section 7159.5, which statement is TRUE regarding service and repair contracts in California?
Correct Answer
D) Written contracts are required for service and repair work exceeding $750
Business and Professions Code Section 7159.5 requires written contracts for service and repair work exceeding $750. This threshold is lower than the $500 threshold for home improvement contracts under Section 7159, reflecting California's emphasis on consumer protection in service transactions.
Why This Is the Correct Answer
B&P Code Section 7159.5 specifically requires written contracts for service and repair work when the total price exceeds $750. This threshold applies to service and repair agreements — a separate category from the home improvement contracts governed by Section 7159. Having a written contract at this dollar level protects both the homeowner and contractor by documenting scope, price, and terms before work begins.
Why the Other Options Are Wrong
Option A: Written contracts are required for all service and repair work exceeding $500
The $500 threshold is associated with other contractor regulations but is not the correct threshold for service and repair contracts under Section 7159.5. Confusing these dollar amounts is a common exam error. The correct figure for service and repair is $750.
Option B: Oral contracts are acceptable for service and repair work under $750
Oral contracts are not acceptable for service and repair work exceeding $750, even if one might informally think small jobs don't need paperwork. The law requires written agreements above $750 regardless of how routine or straightforward the work appears. The $750 threshold makes the cutoff somewhat higher than some contractors expect.
Option C: Service and repair contracts must always include a 3-day cancellation clause
A 3-day cancellation clause is not universally required for all service and repair contracts. The 3-day cancellation right under the Home Solicitation Sales Act applies specifically to contracts solicited at the consumer's home through door-to-door sales, not to all service and repair contracts generally.
Memory Technique
Remember '$750 for Service and Repair' — think of it as '750 reasons to put it in writing.' Section 7159.5 = service/repair = $750 threshold.
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