Running the Business · Part 3
The home improvement contract (B&P 7159): every required element, the exact notices, and the three-day right to cancel
Every residential plumbing job over $500 is a home improvement contract under Business and Professions Code section 7159, and the section does not merely require a contract; it dictates what the contract says, in what typeface, under which headings, with which statutory notices attached, and what the customer must be handed before the first tool comes off the truck. Missing any of it is cause for discipline, and the deposit and progress-payment rules inside it are misdemeanors. This lesson walks the section top to bottom, explains what each piece is for, and shows why the three-day right to cancel decides when you may start work. The template that follows it is the form itself, with every notice verbatim.
What the full lesson covers
- The threshold is $500 in aggregate, oral or written, with an owner or a tenant. Almost every plumbing job that is not a small service call is a home improvement contract, and the service and repair form is the only alternative (lesson 3.3).
- The contract must carry thirteen items under exact headings ("Home Improvement," "Contract Price," "Downpayment," "Schedule of Progress Payments," "Approximate Start Date," "Approximate Completion Date," "Note About Extra Work and Change Orders," and the rest), in at least 10-point type, with three statements in 12-point boldface: the right to a completed copy, the $1,000-or-10-percent deposit cap, and the progress-payment warning.
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More lessons in Contracts and Getting Paid
- 1The home improvement contract (B&P 7159): every required element, the exact notices, and the three-day right to cancelYou are here
- 2The deposit cap: $1,000 or 10 percent, whichever is less, and progress payments that cannot exceed the work. CSLB's most common citation
- 3Service and repair contracts (B&P 7159.10): when the short form applies, what it must say, and how a service call falls out of it
- 4Subcontracts with GCs: the twelve clauses to read, what to strike, and what to negotiate
- 5