Oregon Construction Contractors (CCB) Practice Test

When is a construction contract enforceable?

1. Only when written

2. Only with legal capacity

3. When filed with the government

4. When all parties agree verbally

The correct answer is: Only with legal capacity

A construction contract is enforceable when all parties involved have legal capacity, meaning they are mentally competent and of legal age to enter into a contract. This ensures that all parties understand the terms and consequences of the agreement, thus providing a framework for fair and legal obligations. While having a written contract can often strengthen enforceability and clarity, it is not an absolute requirement in all situations. Some contracts can be enforceable even if they are verbal, as long as the terms can be proven and all parties involved have agreed to them; however, this makes it less clear and potentially more difficult to enforce due to the risks of misunderstandings. Filing a contract with the government is not a requirement for enforceability in most cases. Additionally, a contract agreed to verbally can still be enforceable if it meets the necessary criteria, but it may lead to complications when disputes arise, making the clarity of a written agreement often preferable. Legal capacity is thus crucial in ensuring that a construction contract is enforceable, since it confirms that all parties have the ability to understand and participate in the agreement responsibly.