HF 3079

as introduced - 89th Legislature (2015 - 2016) Posted on 03/14/2016 03:53pm

A bill for an act
relating to commerce; building and construction contracts; regulating retainages;
amending Minnesota Statutes 2014, section 337.10, subdivision 4.

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MINNESOTA:

Section 1.

Minnesota Statutes 2014, section 337.10, subdivision 4, is amended to read:

Subd. 4.

Progress payments and retainages.

(a) Unless the building and
construction contract provides otherwise, the owner or other persons making payments
under the contract must make progress payments monthly as the work progresses.
Payments shall be based upon estimates of work completed as approved by the owner or
the owner's agent. A progress payment shall not be considered acceptance or approval of
any work or waiver of any defects therein.

(b) deleted text begin Unless the building and construction contract provides otherwise, deleted text end An owner or
owner's agent may reserve as retainage from any progress payment on a building and
construction contract an amount not to exceed five percent of the payment. An owner or
owner's agent may reduce the amount of retainage and may eliminate retainage on any
monthly contract payment if, in the owner's opinion, the work is progressing satisfactorily.

(c) This subdivision does not apply to contracts for professional services as defined
in sections 326.02 to 326.15.

new text begin EFFECTIVE DATE; APPLICATION. new text end

new text begin This section is effective August 1, 2016,
and applies to contracts entered into on or after that date.
new text end