SECTIONS 9400-9414 - California Statutes

CIVIL CODE

SECTION 9400-9414

9400. A direct contractor may obtain release of funds withheld
pursuant to a stop payment notice under the summary proceeding
provided in this article on any of the following grounds:
(a) The claim on which the notice is based is not a type for which
a stop payment notice is authorized under this chapter.
(b) The claimant is not a person authorized under Section 9100 to
give a stop payment notice.
(c) The amount of the claim stated in the stop payment notice is
excessive.
(d) There is no basis for the claim stated in the stop payment
notice.

9402. The direct contractor shall serve on the public entity an
affidavit, together with a copy of the affidavit, in compliance with
the requirements of Chapter 2 (commencing with Section 8100) of Title
1, that includes all of the following information:
(a) An allegation of the grounds for release of the funds and a
statement of the facts supporting the allegation.
(b) A demand for the release of all or the portion of the funds
that are alleged to be withheld improperly or in an excessive amount.
(c) A statement of the address of the contractor within the state
for the purpose of permitting service by mail on the contractor of
any notice or document.

9404. The public entity shall serve on the claimant a copy of the
direct contractor's affidavit, together with a notice stating that
the public entity will release the funds withheld, or the portion of
the funds demanded, unless the claimant serves on the public entity a
counteraffidavit on or before the time stated in the notice. The
time stated in the notice shall be not less than 10 days nor more
than 20 days after service on the claimant of the copy of the
affidavit. The notice shall comply with the requirements of Chapter 2
(commencing with Section 8100) of Title 1.

9406. (a) A claimant that contests the direct contractor's
affidavit shall serve on the public entity a counteraffidavit
alleging the details of the claim and describing the specific basis
on which the claimant contests or rebuts the allegations of the
contractor's affidavit. The counteraffidavit shall be served within
the time stated in the public entity's notice, together with proof of
service of a copy of the counteraffidavit on the direct contractor.
The service of the counteraffidavit on the public entity and the copy
of the affidavit on the direct contractor shall comply with the
requirements of Chapter 2 (commencing with Section 8100) of Title 1.
(b) If no counteraffidavit with proof of service is served on the
public entity within the time stated in the public entity's notice,
the public entity shall immediately release the funds, or the portion
of the funds demanded by the affidavit, without further notice to
the claimant, and the public entity is not liable in any manner for
their release.
(c) The public entity is not responsible for the validity of an
affidavit or counteraffidavit under this article.

9408. (a) If a counteraffidavit, together with proof of service, is
served under Section 9406, either the direct contractor or the
claimant may commence an action for a declaration of the rights of
the parties.
(b) After commencement of the action, either the direct contractor
or the claimant may move the court for a determination of rights
under the affidavit and counteraffidavit. The party making the motion
shall give not less than five days' notice of the hearing to the
public entity and to the other party.
(c) The notice of hearing shall comply with the requirements of
Chapter 2 (commencing with Section 8100) of Title 1. Notwithstanding
Section 8116, when notice of the hearing is made by mail, the notice
is complete on the fifth day following deposit of the notice in the
mail.
(d) The court shall hear the motion within 15 days after the date
of the motion, unless the court continues the hearing for good cause.

9410. (a) The affidavit and counteraffidavit shall be filed with
the court by the public entity and shall constitute the pleadings,
subject to the power of the court to permit an amendment in the
interest of justice. The affidavit of the direct contractor shall be
deemed controverted by the counteraffidavit of the claimant, and both
shall be received in evidence.
(b) At the hearing, the direct contractor has the burden of proof.

9412. (a) No findings are required in a summary proceeding under
this article.
(b) If at the hearing no evidence other than the affidavit and
counteraffidavit is offered, the court may, if satisfied that
sufficient facts are shown, make a determination on the basis of the
affidavit and counteraffidavit. If the court is not satisfied that
sufficient facts are shown, the court shall order the hearing
continued for production of other evidence, oral or documentary, or
the filing of other affidavits and counteraffidavits.
(c) At the conclusion of the hearing, the court shall make an
order determining whether the demand for release is allowed. The
court's order is determinative of the right of the claimant to have
funds further withheld by the public entity.
(d) The direct contractor shall serve a copy of the court's order
on the public entity in compliance with the requirements of Chapter 2
(commencing with Section 8100) of Title 1.

9414. A determination in a summary proceeding under this article is
not res judicata with respect to a right of action by the claimant
against either the principal or surety on a payment bond or with
respect to a right of action against a party personally liable to the
claimant.