16-1904. Retainage; release and withholding thereof; failure to pay. - Kansas Statutes

16-1904

Chapter 16.--CONTRACTS AND PROMISES Article 19.--KANSAS FAIRNESS IN PUBLIC CONSTRUCTION CONTRACT ACT

      16-1904.   Retainage; release and withholding thereof; failure to pay. (a) An owner, contractor or subcontractor may withhold no more than 10% retainage from the amount of any undisputed payment due.

      (b)   An owner must release the retainage on any undisputed payment due on a construction project within 30 days after substantial completion of the project; however, if any subcontractor is still performing work on the project under its subcontract, an owner may withhold that portion of the retainage attributable to such subcontract until 30 days after such work is completed.

      (c)   If an owner, contractor or subcontractor fails to pay retainage, if any, pursuant to the terms of a contract for public construction or as required by this act, the owner, contractor or subcontractor shall pay interest to the contractor or subcontractor to whom payment was due, beginning on the first business day after the payment was due, at a rate of 18% per annum.

      (d)   Nothing in this section shall prevent early release of retainage if it is determined by the owner, the contractor and the project architect or engineer, that a subcontractor has completed performance satisfactorily and that the subcontractor can be released prior to substantial completion of the entire project without risk or additional cost to the owner or contractor. Once so determined, the contractor shall request such adjustment in retainage, if any, from the owner as necessary to enable the contractor to pay the subcontractor in full, and the owner shall, as part of the next contractual payment cycle, release the subcontractor's retainage to the contractor, who shall, as part of the next contractual payment cycle, release such retainage as is due to the subcontractor.

      History:   L. 2007, ch. 163, § 4; July 1.