436.309. Subcontractor may tender substitute security, when. - Missouri Statutes

Subcontractor may tender substitute security, when.

436.309. A subcontractor of the contractor may tender to the contractoracceptable substitute security as set forth in section 436.312 with a writtenrequest for release of retainage in the amount of the substitute security.The contractor shall tender the subcontractor's substitute security to theowner with a like request, pursuant to the provisions of section 436.306.Provided that the subcontractor is not in default of its agreement with thecontractor, the contractor shall pay over to the subcontractor, within fiveworking days after receipt, any accumulated retainage paid by the owner to thecontractor on account of substitute security tendered by the subcontractor,except that the contractor shall not be required to pay over retainage inexcess of the amount properly attributable to work completed by thesubcontractor at the time of payment. Provided that the subcontractor is notin default of its agreement with the contractor, the contractor shall refrainfrom withholding retainage from payments to the subcontractor to the extentthe owner has refrained from withholding retainage from payments to thecontractor on account of the subcontractor's substituted security. Thesubcontractor shall be entitled to receive, upon receipt by the contractor,all income received by the contractor from the owner on account ofincome-producing securities deposited by the subcontractor as substitutesecurity. Except as otherwise provided in this section, the contractor shallhave no obligation to collect or pay to a subcontractor retainage on accountof substitute security tendered by the subcontractor.

(L. 2002 H.B. 1403)