Free C-36 Practice Questions: Law

Civil Code Section 8812: if an owner withholds a retention from a direct contractor, the owner shall, within 45 days after completion of the work of improvement, pay the retention to the contractor.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8812

Civil Code Section 8190: an owner that records a notice of completion shall give a copy within 10 days to the direct contractor and to each claimant that gave the owner preliminary notice. If the owner fails to do so, the notice is ineffective to shorten that person's time to record a claim of lien.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8190

CSLB's bond fact sheet: when a contractor uses a cashier's check instead of a bond, the consumer must file a lawsuit against the licensee and the CSLB Registrar of Contractors, and CSLB can only make payment from a cashier's check under a court order.

Source: Fast Facts: License Bond (2025 update) (2025) p.2

Business and Professions Code Section 7159.5(a): failure to comply with its provisions is cause for discipline. One of those provisions limits the downpayment to $1,000 or 10 percent of the contract amount, whichever is less.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7159.5

The change order should clearly state the new total contract price ($3,500) to avoid confusion. Both parties should understand the final amount owed.

Source: Arithmetic from the question

BPC Section 7159 (Mechanics Lien Warning): when it is time to pay for the work of a subcontractor or supplier who has given a Preliminary Notice, write a joint check payable to both the contractor and the subcontractor or material supplier.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7159

CSLB's examination FAQ: candidates who fail are eligible to retake the examination after 21 calendar days, as long as they are not past their 18-month void date.

Source: CSLB Examinations Frequently Asked Questions s.4

BPC Section 7031: a person acting as a contractor may not bring or maintain an action to collect compensation for work requiring a license without alleging that they were a duly licensed contractor at all times during the performance of that act or contract, regardless of the merits of the claim.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7031

BPC Section 7159.5: on request, the contractor shall obtain and furnish a full and unconditional release for the work paid for, and the person contracting for home improvement may withhold all further payments until these releases are furnished.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7159.5

Civil Code Section 8520(a): a person that has a lien right, other than a direct contractor, may give the owner a stop payment notice. The owner then withholds funds due to the direct contractor to cover the claim, as the chapter provides.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8520

BPC Section 7163: a home improvement contract that depends on obtaining a loan is unenforceable until the loan requirements are met, and until then the contractor may not deliver property or perform services other than obtaining building permits or similar preliminary services for which no mechanic's lien can be claimed.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7163

Civil Code Section 8508: a stop payment notice is valid only if the claimant gave preliminary notice as required and gave the stop payment notice before expiration of the time within which a claim of lien must be recorded.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8508

Civil Code Section 8200(e): a laborer is not required to give preliminary notice, and a claimant with a direct contractual relationship with an owner or reputed owner is required to give preliminary notice only to the construction lender or reputed construction lender, if any.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8200

Civil Code Section 8416: failure to serve the copy of the claim of mechanics lien, including the Notice of Mechanics Lien, causes the claim of mechanics lien to be unenforceable as a matter of law.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8416

BPC Section 7162: a representation about the brand name, quality, or size of goods such as bathroom fixtures or a sink shall be set forth in writing in the contract or specifications, with a description including any brand name, model number, or similar designation.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7162

Civil Code Section 8814: a direct contractor that withheld a retention from subcontractors shall, within 10 days after receiving all or part of a retention payment, pay each subcontractor its share.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8814

BPC Section 7152: a bona fide service repairperson employed by a licensed contractor, whose call is limited to the service, repair, or emergency repair initially requested by the buyer, is not required to be registered as a home improvement salesperson.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7152

BPC Section 7159 (Three-Day Right to Cancel notice): if the buyer cancels, the contractor must return anything paid within 10 days of receiving the notice of cancellation.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7159

BPC Section 7071.8: the disciplinary bond is in a sum fixed by the registrar based upon the seriousness of the violation, not less than $25,000 nor more than 10 times the regular contractor's bond amount, and it must remain on file for at least two years.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7071.8

Labor Code Section 227.3: when an employee is terminated without having taken vested vacation, all vested vacation is paid as wages at the final rate, and an employment contract or policy cannot provide for forfeiting vested vacation on termination.

Source: Labor Code, cited sections LAB 227.3

Title 8 Section 14300.29: you must use Cal/OSHA 300, 300A and 301 forms, or equivalent forms, for recordable injuries and illnesses. The 300 is the log, the 300A the annual summary, and the 301 the incident report.

Source: CCR Title 8 outside the Construction Safety Orders (General Industry, Electrical, and other safety orders), cited sections T8 14300.29

Business and Professions Code Section 7031(b): a person who utilizes the services of an unlicensed contractor may bring an action in any court of competent jurisdiction to recover all compensation paid to the unlicensed contractor. A CSLB citation is a separate matter.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7031

BPC Section 7159.14: for a service and repair contract, payment shall not be due before the project is completed.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7159.14

BPC Section 7027.1: it is a misdemeanor to advertise for construction work unless the person holds a valid license in the classification so advertised. A violation is punishable by a fine of not less than $700 and not more than $1,000.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7027.1

Business and Professions Code Section 7140: all contractor licenses expire two years from the last day of the month in which the license is issued, or two years from the date the renewed license last expired. To renew, the licensee applies and pays the renewal fee before expiration.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7140

BPC Section 7157: a contractor may give a promotional gift, not conditioned on a contract, if the gift does not exceed a value of $5 and only one such gift is given in connection with any one transaction.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7157

Title 8 Section 14300.7: a case is recordable if it results in death, days away from work, restricted work or transfer to another job, medical treatment beyond first aid, or loss of consciousness, or is a significant diagnosed injury or illness.

Source: CCR Title 8 outside the Construction Safety Orders (General Industry, Electrical, and other safety orders), cited sections T8 14300.7

Civil Code Section 8416(a): a claim of mechanics lien is a written statement, signed and verified by the claimant, containing the claimant's demand after credits and offsets, the owner or reputed owner, a general statement of the work, the person who employed the claimant, a description of the site sufficient for identification, the claimant's address, and a proof of service affidavit.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8416

CSLB Law and Business book: with a revocation, the licensee's right to contract is taken away, and the license shall not be reinstated or reissued for one to five years from the effective date of the decision.

Source: Contractors State License Law & Reference Book, 2026 (B&P, CCR Title 16 Division 8, related codes) (2026) p.26

BPC Section 7159: a home improvement contract includes, if applicable, the name and registration number of the home improvement salesperson that solicited or negotiated the contract.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7159

Civil Code Section 8536(a): on receipt of a stop payment notice, a construction lender shall withhold from the borrower or other person it pays out of the construction fund sufficient funds to pay the claim stated in the notice, except as subdivision (b) allows.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8536

Civil Code Section 8060(b): recording a notice, claim of lien, release of lien, payment bond or other paper is done by filing it for record in the office of the county recorder of the county where the work of improvement is situated.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8060

BPC Section 7071.6 sets the contractor's bond, and lets the board require an applicant to post a contractor's bond in twice the amount normally required, until the license is renewed, when the applicant was convicted of or cited for unlicensed contracting (the citation being a final order) and the violation constituted a substantial injury to the public.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7071.6

BPC Section 7053: the license law does not apply to a person working as an employee who receives wages as their sole compensation, does not customarily engage in an independently established business, and does not control the manner of performance so as to determine the final results.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7053

BPC Section 7083: licensees must notify the registrar in writing, on the registrar's form, within 90 days of any change to recorded information, including changes in business address, personnel, and business name. Failing to do so is grounds for disciplinary action.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7083

BPC Section 7098: when any license has been revoked, any additional license issued in the name of the licensee, or for which the licensee furnished qualifying experience and appearance, may be revoked by the registrar without further notice.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7098

Civil Code Section 8424: the bond shall be in an amount equal to 125 percent of the amount of the claim of lien (or 125 percent of the amount allocated in the claim of lien to the real property to be released).

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8424

BPC Section 7125.4: employing workers without maintaining workers' compensation coverage is cause for discipline, with a minimum civil penalty of $10,000 per violation for a sole owner licensee and $20,000 per violation for a partnership, corporation, or limited liability company.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7125.4

Civil Code Section 8204(a): a preliminary notice is due not later than 20 days after the claimant first furnishes work. A claimant who did not give one may give it later, but may record a lien, give a stop payment notice, or claim against a payment bond only for work performed within 20 days before the notice is served.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8204

BPC Section 7028: after a prior conviction, the court shall impose a fine of 20 percent of the contract price (or of the payments made), or $5,000, whichever is greater. 20 percent of $40,000 is $8,000, which is greater than $5,000.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7028

BPC Section 7071.7: the registrar accepts a bond as of the effective date shown on it if the bond is received within 90 days after that date, and reinstates the license, if otherwise eligible, retroactive to the effective date of the bond. April 15 is within 90 days of March 1.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7071.7

Civil Code Section 1689.6: the buyer has the right to cancel a home solicitation contract until midnight of the third business day, or until midnight of the fifth business day if the buyer is a senior citizen, after the day the buyer signs.

Source: Civil Code (outside the works-of-improvement part), cited sections CIV 1689.6

Civil Code Section 1689.13: for a buyer-initiated contract for emergency or immediately necessary repairs, the buyer gives the seller a separate statement that is dated and signed, describes the situation that requires immediate remedy, and expressly acknowledges and waives the right to cancel.

Source: Civil Code (outside the works-of-improvement part), cited sections CIV 1689.13

BPC Section 7076: an individual license is canceled upon the death of the licensee. An immediate member of the family may request a continuance of the license to complete projects in progress and undertake new work for a reasonable time; the written request must be received at CSLB headquarters within 90 days after the death. The family member must later get their own license.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7076

Business and Professions Code Section 7159: the "Three-Day Right to Cancel" notice must comply with several rules, including that the text of the notice is at least 12-point boldface type and is in immediate proximity to a space for the owner’s signature.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7159

Civil Code Section 8200: a laborer is not required to give preliminary notice. Subcontractors, material suppliers, and equipment lessors must give it before recording a lien claim.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8200

Title 8 Section 342: the report is made immediately, meaning as soon as practically possible but not longer than 8 hours after the employer knows or with diligent inquiry would have known of the serious injury or illness.

Source: CCR Title 8 outside the Construction Safety Orders (General Industry, Electrical, and other safety orders), cited sections T8 342

CSLB Law and Business: probation is a stay of suspension or revocation. The licensee must abide by certain terms and conditions to keep the suspension or revocation from going into effect, and must file a disciplinary bond to stay in business during that period.

Source: Contractors State License Law & Reference Book, 2026 (B&P, CCR Title 16 Division 8, related codes) (2026) p.26

Business and Professions Code Section 7141(a): an expired license may be renewed at any time within five years after its expiration by filing a renewal application and paying the renewal fee. Contracting on an expired license is unlicensed contracting.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7141

Business and Professions Code Section 7029: a joint venture license is a license issued to any combination of individuals, corporations, LLCs, partnerships, or other joint ventures, each of which holds a current, active license in good standing. Two contractors acting together as a joint venture need this license.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7029

Civil Code Section 8818: an owner or direct contractor that does not make a retention payment on time is liable for a penalty of 2 percent per month on the amount wrongfully withheld, in place of any interest otherwise due.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8818

Title 8 Section 3203: documentation of safety and health training for each employee includes employee name or other identifier, training dates, type(s) of training, and training providers. This documentation shall be maintained for at least one (1) year.

Source: CCR Title 8 outside the Construction Safety Orders (General Industry, Electrical, and other safety orders), cited sections T8 3203

CSLB advertising guidelines: C-36 Plumbing contractors must display their business name and address and license number on each side of every commercially-registered vehicle in letters at least 1 ½ inches high.

Source: Advertising Guidelines p.1

BPC Section 7071.9 requires a qualifying individual who is not the proprietor or a general partner to file a $25,000 qualifying individual's bond, but a responsible managing officer who owns 10 percent or more of the voting stock of the corporation, and certifies that fact on the registrar's form, is not required to file it.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7071.9

CSLB's licensing guide lists the classifications allowed to do solar work: C-36 plumbing contractors are authorized to perform any project using solar equipment to heat water or fluids to a suitable temperature. Photovoltaic systems belong to classifications such as the C-46 Solar contractor.

Source: Get Licensed to Build (ENG0525) p.18

BPC Section 7044: the owner-builder exemption depends on the structure not being intended or offered for sale. Proof of the sale or offering for sale of a structure within one year after completion is a rebuttable presumption that it was undertaken for purposes of sale, which can defeat the exemption.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7044

BPC Section 7048 does not apply when a division of the operation is made in contracts of amounts less than $1,000 for the purpose of evasion of the license law or otherwise. The $4,000 repipe is one operation and needs a licensed contractor.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7048

CSLB licensing guide: credit is given only for experience as a journeyperson, foreperson, supervising employee, or contractor. A journeyperson is an experienced worker who can perform the trade without supervision, or someone who has completed an apprenticeship program.

Source: Get Licensed to Build (ENG0525) p.13

Civil Code Section 8600: the section applies if, before the commencement of work, the owner files the direct contract with the county recorder and records a payment bond of the direct contractor in an amount not less than 50 percent of the price stated in the direct contract.

Source: Civil Code, Division 4, Part 6 (Works of Improvement: liens, stop payment notices, payment bonds, retention) CIV 8600

BPC Section 7159: before any work is started, the contractor shall give the buyer a copy of the contract signed and dated by both the contractor and the buyer. The buyer's receipt of that copy starts the buyer's rights to cancel.

Source: Business and Professions Code, Division 3, Chapter 9 (Contractors State License Law) BPC 7159