Contracts & ExecutionQuestion 719 of 1632

'Joint control' in the context of a home improvement project refers to:

a.Two contractors operating together under a single licence number
b.The homeowner and the lender co-signing every cheque to the contractor
c.An approved funding control releasing money as work proceeds
d.The building department inspecting each separate phase of the work

Explanation

A joint control, or funding control, is a neutral third party that holds the construction funds and releases them to the contractor against verified progress. B&P §7159.5(a)(8) is why it matters: a contractor who furnishes a joint control APPROVED BY THE REGISTRAR covering full performance and payment is exempt from the downpayment cap, the dollars-and-cents payment schedule, and the bar on accepting payment ahead of the value in place, and may take payment before completion. Two conditions travel with it — the registrar's approval, and the contractor holding no financial or other interest in the control. (b) describes joint checks, the different protection the Mechanics Lien Warning recommends to owners. (d) describes permit inspections, which verify code compliance, not payment. (a) describes unlawful licence sharing.

Law Reference: Bus. & Prof. Code §7159.5(a)(8)

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Reviewed by Abraham Chen — Licensed California General Contractor (CSLB License #1101856 — verify)
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