Current through Pa Acts 2024-53, 2024-56 through 2024-111
Section 506 - Owner's withholding of payment for good faith claims(a) Authority to withhold.--The owner may withhold payment for deficiency items according to the terms of the construction contract. The owner shall pay the contractor according to the provisions of this act for any item which appears on the invoice and has been satisfactorily completed.(b) Notice.-- (1) Except as provided under section 9, if an owner withholds payment from a contractor for a deficiency item, the amount withheld shall be reasonable and the owner shall notify the contractor of the deficiency item by a written explanation of its good faith reason within 14 calendar days of the date that the invoice is received.(2) Failure to comply with paragraph (1) shall constitute a waiver of the basis to withhold payment and necessitate payment of the contractor in full for the invoice.(3) If an owner withholds payment from a contractor for a deficiency item, the owner shall remit payment to the contractor for each other item that has been satisfactorily completed under the construction contract.Amended by P.L. TBD 2018 No. 27, § 2, eff. 10/10/2018.1994, Feb. 17, P.L. 73, No. 7, § 6, effective in 60 days.