Brian G. Corgan | Kilpatrick Townsend & Stockton Effective January 1, 2026, two groundbreaking California statutes will significantly impact private construction contracts executed after this date. The first, California Civil Code § 8811, imposes a strict five percent (5%) cap on retainage for most private projects, fundamentally changing the longstanding practice of parties negotiating retainage… Continue reading New California Statutes Reshape Retainage and Payment Practices in Private Construction Contracts
Tag: Retainage
California Expands 5 Percent Retainage Cap to Private Construction Projects
Connor Cafferty, Joe Watson and Alan J. Watson | Holland & Knight Recent updates to California law impose new limitations on retainage for private construction projects. Under the updated California Prompt Payment Act, retainage on private works is now capped at 5 percent of the contract price.1 This statutory cap carries meaningful enforcement mechanisms. If… Continue reading California Expands 5 Percent Retainage Cap to Private Construction Projects
Retainage in the Southwest: A Look Into Arizona and New Mexico Retainage Laws
Amanda Manke, David Wilhelmsen and Craig Williams | Snell & Wilmer Retainage is a practice, standard in the construction industry, of withholding predetermined portions of payments due to the contractor until the project is complete. Developers (including project owners and their lenders) prefer requiring retainage for three primary reasons. First, retainage encourages their contractors to… Continue reading Retainage in the Southwest: A Look Into Arizona and New Mexico Retainage Laws
Retainage: What Contractors Need to Know and Helpful Strategies
Gerard J. Onorata | ConsensusDocs Introduction Most, if not all, construction contracts contain a provision for “retainage.” The origin and concept of retainage dates back to the railroad boom that embraced Great Britain in the 1840s. In its simplest terms, retainage is a mechanism by which an owner or general contractor withholds disbursement of funds… Continue reading Retainage: What Contractors Need to Know and Helpful Strategies
Oregon Construction Owners and Lenders Are Affected by New Retainage Law
D. Gary Christensen and Jonathon Goodling | Miller Nash If you develop or build on real property in Oregon, your progress payments to contractors on future projects will be affected by a new law, effective on March 7, 2024. If you are a construction lender, your borrower may request that your periodic loan advances to… Continue reading Oregon Construction Owners and Lenders Are Affected by New Retainage Law