Oregon Construction Contractors (CCB) Practice Test

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When must construction contracts be in written form?

For any project over $2,000
Only if specified by the contractor
For commercial projects only
Always as a rule

The correct answer is: For any project over $2,000

Construction contracts must be in written form for projects exceeding $2,000 to ensure clarity, protect the rights of both parties, and provide a formal record of the agreement. This requirement is particularly important in the construction industry due to the complexity of many projects and the potential for disputes. Having a written contract helps to define the scope of work, set payment terms, outline responsibilities, and establish timelines. The threshold amount of $2,000 is significant because it distinguishes between smaller, perhaps informal agreements that may not require as much structure, and larger engagements that are more likely to involve significant financial stakes. In essence, written contracts serve to mitigate risk and provide legal enforceability, particularly in a field where misunderstanding or miscommunication can lead to costly consequences. This practice helps to maintain professionalism and accountability in the construction industry, making it clear when formal agreements are necessary. The other options do not accurately represent the requirement for written contracts in terms of compliance and best practices in construction management.