Contracts & ExecutionQuestion 175 of 1632

"Substantial completion" of a construction project generally means:

a.The owner has recorded a notice of completion
b.Every punch-list item has been finished and signed off
c.Exactly 90% of the contract price has been paid
d.The owner can use the project for the purpose intended

Explanation

Substantial completion is the point where the work is complete enough for the owner to occupy or use the project for its intended purpose, even with minor punch-list items still open. Clearing every punch-list item is final completion, which comes later. Recording a notice of completion is an owner's filing that starts the lien and stop-payment clocks; it does not measure how finished the work is. And no payment percentage defines the term - 90% paid usually just means retention is still being held.

This topic, taught in full in the CSLB Law & Business guide. CSLB Law & Business — Complete Study Guide (2026) — PDF + EPUB, $24.99 · 14-day refund →

Practice all 1632 questions free — no signup required.

Own the complete CSLB Law & Business guide — PDF + EPUB, $24.99 →

Related questions on this topic

Last reviewed: · editorial process

PrepPass team · Verified against California CSLB Contractor License Law & Business Exam · How we review
Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)
Report