CSLB Audit Reveals Non-Compliance with Contract Law Posted on Dec 09, 2020

As part of the California Public Utility Commissions consumer protection decisions, the California State License Board ("CSLB") now has the ability to review contracts submitted as part of the interconnection process in IOU territories. In July, the CSLB reviewed 153 contracts to ensure the contractors were licensed, the Home Improvement Salesperson or “HIS” (if applicable) was registered to the prime contractor and that the contracts were complying with state contract law. While all the contractors were properly licensed, the CSLB did find that over 90% of the contracts were not complying with HIS or home improvement contractor requirements.

The CSLB's findings and instructions for complying with the state law were, as follows:

  1. CSLB found 50 contracts where the HIS was not registered with the CSLB and another 12 where the HIS was not registered to the prime contractor.
  2. 141 of the contracts did not follow contract law regarding commencement and completion dates. All contracts must have an approximate start date and completion date. 
  3. 149 of the contracts did not follow rules regarding payment schedules

The CSLB document “Contracting for Success,” and Business and Professions Code Section 7159 summarize the requirements of home improvement contract law. The CSLB will continue to review random contracts from the interconnection portal, so we recommend all residential contracting members review their contracts to ensure they are compliant with the law.
On a separate consumer protection matter, AB 2471 passed this year and requires that senior citizens be given a five day right to cancel a home-improvement contract, instead of the standard three. This new requirement starts January 1, 2021. 

Check out our Residential Solar System Installation Agreement if you are in need of a document that meets these CSLB requirements: 

Residential Solar System Installation Agreement (CA)