Contracts & ExecutionQuestion 724 of 1632

A homeowner calls a plumber for an urgent $400 leak repair. The plumber may use a service and repair contract only if, among other conditions, the plumber:

a.Collects at least a 25 percent deposit before beginning the work
b.Adds a yearly maintenance plan so the customer's system stays covered
c.Extends the job to include a full bathroom remodel while on site
d.Sells nothing beyond what is reasonably necessary to fix the reported leak

Explanation

B&P §7159.10(a) allows a service and repair contract only when four things are all true: the contract amount is $750 or less, the buyer initiated contact to request the work, the contractor does not sell goods or services beyond those reasonably necessary to take care of the particular problem that caused the buyer to call, and no payment is due or accepted until the work is completed. (a) breaks the fourth condition outright — a deposit on a service and repair job is prohibited, not merely capped by the home improvement rule of $1,000 or 10 percent. (b) and (c) both break the third. The consequence matters: under §7159.10(b), the moment any condition fails the full §7159 home improvement requirements apply to the contract regardless of price, cancellation rights included.

Law Reference: Bus. & Prof. Code §7159.10(a), (b)

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