GHI Contractors received their license 18 months ago but has never been active. What happens to their license?
Correct Answer
D) Automatic revocation
Under B&P Code Section 7076, licenses that remain inactive for 18 months after issuance are automatically revoked.
Why This Is the Correct Answer
Automatic revocation is correct. Under B&P Code Section 7076, a license that has never been activated and remains inactive for 18 months after issuance is automatically revoked. This provision prevents contractors from holding licenses indefinitely without conducting any business.
Why the Other Options Are Wrong
Option A: No action required
No action required is incorrect. California law does not allow licenses to sit dormant indefinitely. The 18-month inactive period triggers automatic revocation under B&P Code Section 7076.
Option B: Placed on inactive status
Placed on inactive status is incorrect. 'Inactive status' is a different classification that requires an affirmative request by the licensee. A license that was never active for 18 months faces the more severe consequence of automatic revocation, not merely inactive status.
Option C: Suspension until activated
Suspension until activated is incorrect. Suspension is a disciplinary action that typically requires CSLB proceedings. The consequence for an 18-month dormant license is automatic revocation, not a temporary suspension.
Memory Technique
18 months = 1.5 years of nothing = REVOKED. Picture a license certificate crumbling to dust after sitting untouched for a year and a half.
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
What is the fundamental difference between Class A and Class B contractor licenses in California?
Next Question
DEF Construction's workers' compensation policy lapses on March 15th. They continue working until March 30th when coverage is restored. What is the potential penalty exposure?