LBExamExtra work on a California home improvement job is enforceable only if a change order describing it is written and signed before the work starts. In a home improvement contract the scope on the page is the scope, so anything added to it needs its own paperwork first. The rule sits in two places in the Contractors State License Law, and the second one says what happens when the first is skipped.
A change order is part of the contract only if it is written and signed first
Bus. & Prof. Code s. 7159(c)(5) requires a change-order form for changes or extra work to be incorporated into every home improvement contract, and says the form becomes part of the contract only if it is in writing and signed by the parties before the work covered by the change order begins. Subdivision (d) says the same thing from the other side: the contract and any changes to it shall be in writing and signed by the parties before the work covered by the contract or the change order starts.
The contract also has to carry a heading, “Note About Extra Work and Change Orders”, followed by a fixed statement (s. 7159(d)(13)). The statement carries the rule in two sentences: extra work and change orders become part of the contract once the order is prepared in writing and signed by the parties before the work starts, and the order must describe the scope of the extra work or change, the cost to be added or subtracted from the contract, and the effect the order will have on the schedule of progress payments.
Those three items are what s. 7159.6 turns into a test of enforceability. A change order is not enforceable against a buyer unless it sets out the scope of work, the amount to be added or subtracted, and the effect on the progress payments or the completion date. The buyer, for their part, may not require the contractor to perform extra or change-order work without providing written authorization (subdivision (b)). A buyer who disputes the bill for extra work is bound by what was signed, and so is the contractor.
The contract’s notice section repeats all of this to the buyer. Under s. 7159(e)(3), the contract tells the buyer that they cannot require change order work without written authorization first, that a change order is not enforceable against them unless it identifies the three items in writing before the work starts, and that the contractor’s failure to comply does not bar recovery for the work under the remedies that prevent unjust enrichment.
What happens when the paperwork is skipped
That last clause is s. 7159.6(c), repeated in s. 7159(e)(3)(C): the contractor’s failure to comply does not preclude the recovery of compensation for work performed, based on legal or equitable remedies designed to prevent unjust enrichment. An unsigned change order is not a gift to the homeowner. The contractor loses the contract claim for the extra amount and is left arguing the value of the work in court. On the Law and Business exam the distinction is between “unenforceable as a change order” and “no recovery at all”, and the statute says the first.
Discipline is separate. Failure to provide the information, notices and disclosures s. 7159 requires is cause for discipline under s. 7159(a)(5)(A), whatever a court later does about the money.
Since January 1, 2026: the subcontractor line on every change order
SB 517 added a subcontractor disclosure to s. 7159(c)(7), effective January 1, 2026. The contract states whether a subcontractor will be used, with a box for yes or no. If yes, the contract carries a disclaimer that a list of subcontractors, with names, contact information, license numbers and classifications, will be provided on request. Subparagraph (C) then says: if there is a change order during the project, the same disclaimer shall be on each change order. A change-order form printed before 2026 is missing a line.
Payment on the changed scope
The change order alters the price and the schedule, and the payment rules follow the schedule. Section 7159.5(a)(5) bars a contractor from requesting or accepting payment that exceeds the value of the work performed or material delivered, apart from the downpayment. A change order that adds $6,000 of work does not let you collect $6,000 on signing; it lets you add a progress payment that references the work it pays for. That is why s. 7159.6 requires the order to state its effect on the progress payments: the schedule in the contract has to still describe each phase and its amount after the change.
The downpayment cap does not reopen. The $1,000 or 10 percent limit in s. 7159.5(a)(3) applies to the contract amount, and a contractor who furnishes a performance and payment bond, or approved joint control, is exempt from the cap and the progress payment rules under s. 7159.5(a)(8).
Service and repair jobs have their own version
A service and repair contract under s. 7159.10, which is a job of $750 or less that the buyer initiated, with nothing sold beyond what fixes the problem and no payment until the work is done, does not use the s. 7159 change-order machinery. Its equivalent is in s. 7159.10(e)(7): where the price is estimated by a time and materials formula, the contract states the set rate, the estimated cost of materials, how time is computed, and the sentence “The actual contract amount of a time and materials contract may not exceed the estimated contract amount without written authorization from the buyer.” Same idea, one sentence long. If any of the four service and repair conditions fails, s. 7159(c), (d) and (e) apply to the job regardless of price (s. 7159.10(b)), change-order rules included.
Sources
- Contractors State License Law, Business and Professions Code, Division 3, Chapter 9, ss. 7159, 7159.5, 7159.6 and 7159.10; s. 7159 as amended by SB 517 (Ch. 585, Statutes of 2025), effective January 1, 2026