Recent amendments to the Pennsylvania Contractor and Subcontractor Payment Act affect virtually all non-public construction contracts entered in the commonwealth on or after October 10, 2018. Residential projects of less than six units are not affected. Some of these changes include the following:
Suspension of Work
Contractors and subcontractors will have a statutory right to suspend work without penalty if not paid in accordance with their contract. To legally suspend work, specific notice requirements must be met. This right cannot be waived by contract. Consult construction counsel before suspending work under this provision.
Requirements for Withholding Payment for Deficiency Items and Invoice Errors
Owners, contractors, and subcontractors are subject to the imposition of penalty interest and attorney fees for failing to provide a written explanation of payments withheld due to deficient work or materials within 14 days of receipt of the invoice. Notice of invoice errors must be given within 10 days of receipt of the invoice. Undisputed amounts must be paid in accordance with the construction contract. Consult construction counsel when considering withholding payment for any reason.
This post was written by Timothy Berkebile.