Contracts & ExecutionQuestion 544 of 690
A homeowner contracts with a Class B contractor to build a new single-family home for $425,000. Under B&P §7164 (residential new construction), the contract MUST include:
a.An arbitration clause
b.A 30-day rescission period
c.A schedule of payments showing the amount of each payment as a sum in dollars and cents AND a description of the work or services to be performed and materials to be provided
d.A liquidated damages amount no greater than $500 per day
Explanation
B&P §7164 governs contracts for new residential construction. Among other items, the contract must include a payment schedule with each payment expressed in dollars and cents and tied to specific work/services or materials to be furnished.
Law Reference: Bus. & Prof. Code §7164Practice all 690 questions free — no signup required.
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