CSLB Law & Business ExamContract Requirements and ExecutionHard
During a remodel, a contractor identifies additional work needed due to unforeseen conditions. Before starting the extra work, the contractor tells the homeowner the price will be billed 'time and materials' without providing any written estimate or written change order, and the homeowner orally agrees. Has the contractor complied with California law?
- ANo, but only because the homeowner was not given a new Notice of Cancellation
- BNo, change orders generally must be in writing and signed by both parties before additional work begins
- CYes, because oral agreement on pricing method satisfies the change order requirement
- DYes, because time-and-materials pricing does not require written documentation
Show answer & explanationAnswer & explanation
Correct answer: B. No, change orders generally must be in writing and signed by both parties before additional work begins
California law requires that changes to the scope of work or price, including unforeseen additional work, be documented in a written change order signed by both the contractor and homeowner before the additional work begins, except in bona fide emergencies; an oral agreement on time-and-materials billing does not satisfy this requirement.
Why the other options are wrong
- A. A new Notice of Cancellation is not the issue here; the missing written change order is.
- C. Oral agreement, regardless of pricing method, is insufficient.
- D. Pricing method (time and materials) does not eliminate the writing requirement.
Written Change Order Requirement
Additional work beyond the original contract scope generally requires a written, signed change order before the work begins, except in genuine emergencies.
- Must be in writing and signed by both parties
- Applies even to time-and-materials pricing
- Emergency situations are a limited exception
Memory trick: No paper, no extra work — sign before you swing the hammer.