CSLB Contractor's Law & Business Practice Exam

When is it appropriate for a contractor to let their attorney review a construction contract?

1. Before the contract is prepared

2. After the contract is prepared but before signing

3. After the contract is signed

4. Only if a dispute arises

The correct answer is: After the contract is prepared but before signing

Having an attorney review a construction contract after it is prepared but before it is signed is critical for several reasons. It ensures that the contractor fully understands their rights and obligations under the contract. An attorney can identify any potential legal pitfalls, ambiguities, or unfavorable terms that the contractor may not recognize on their own. By reviewing the contract before signing, the attorney can provide valuable advice on whether certain clauses are fair, whether the terms comply with applicable laws and regulations, and how the contract might affect the contractor’s business and liability. This proactive approach helps prevent disputes and legal issues down the line, as any problematic provisions can be addressed and negotiated prior to signing, fostering a clear understanding between the contractor and the client from the outset. Reviewing the contract at this stage ensures that the contractor's interests are adequately protected, establishing a solid foundation for the work to be performed.