Short answer: it depends!
Assuming you are using the 4/10 CAR Residential Purchase Agreement, "day 1" would be the day after "acceptance".
"Acceptance" is defined in RPA Para 22A as, "...the time the offer or final counter offer is accepted in writing by a party and is delivered to and PERSONALLY RECEIVED by the other party or that party's authorized agent in accordance with the terms of this offer or a final counter offer."
While Page 8 of the RPA provides for the Buyer to date/time a confirmation of acceptance; located just under the Seller signature lines, this is not required in order to create a binding agreement.
Now, there's another definition that needs to be taken into consideration:
RPA Para 22H also defines "Deliver", "Delivered" or "Delivery" as "... regardless of the method used (i.e. messenger, mail, email, fax, other), means and shall be effective upon (i) personal receipt by Buyer or Seller or the individual Real Estate Licensee for that principal as specified in paragraph D of the section titled Real Estate Brokers on page 8..."
So, "Day 1" should be Monday IF the Buyer or Buyer's agent PERSONALLY received delivery of the seller's acceptance on Sunday as defined above.
Interestingly, since you are asking about contract/contingency timelines, note these additional Para 22 definitions that may influence contract dates:
"Days" means calendar days. However, After Acceptance, the last Day for performance of any act required by this Agreement (including Close Of Escrow) shall not include any Saturday, Sunday, or legal holiday and shall instead be the next Day."
"Days After" means the specified number of calendar days after the occurrence of the event specified, not counting the calendar date on which the specified event occurs, and ending at 11:59PM on the final day."
"Days Prior" means the specified number of calendar days before the occurrence of the event specified, not counting the calendar date on which the specified event is scheduled to occur."
I recently posted an article explaining "days before" and "days after" - the link is below.
it is much less certain, however, if "Buyers have 7 days to remove contingencies" was a sentence written in an Addendum or Counter Offer. In such a circumstance, if you are Seller, and desire a smooth and harmonious deal, I would suggest you count day 1 as Monday. As you can see, all of the contingency timeframes in the RPA begin the day after Acceptance. I think it would be difficult to sustain an argument that day 1 was Sunday, especially if the contract was not signed until 5pm on that day. If you are Buyer, and one day either way is critical, I would suggest that you seek written clarification/confirmation as soon as possible from Seller/Seller's agent.