Skip to main content Skip to office menu Skip to footer
Capital IconMinnesota Legislature
Office of the Revisor of Statutes

SF 3057

as introduced - 86th Legislature (2009 - 2010) Posted on 03/04/2010 03:24pm

KEY: stricken = removed, old language.
underscored = added, new language.
Version List Authors and Status
Rtf
Line numbers 1.1 1.2 1.3 1.4 1.5
1.6 1.7 1.8 1.9 1.10 1.11 1.12 1.13 1.14 1.15 1.16 1.17 1.18 1.19 1.20 1.21 1.22 1.23 1.24 2.1 2.2 2.3 2.4 2.5 2.6

A bill for an act
 relating to commerce; regulating building and construction contracts; requiring
retainage to be held in escrow or trust accounts until released; amending
Minnesota Statutes 2009 Supplement, section 337.10, subdivision 4.

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

Section 1.

Minnesota Statutes 2009 Supplement, 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.new text begin Any retainage reserved pursuant to this
subdivision must be held in an interest-bearing escrow or trust account with a bank or
trust company having its principal place of business in the state. Within 30 days after
substantial completion of all the work required by the contract, the reserved retainage and
interest must be released and paid to the persons from whom the retainage was reserved.
new text end

(b) Unless the building and construction contract provides otherwise, 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 (d) For purposes of this subdivision, substantial completion means either that the
work required by the contract has been completed except for work having a contract price
of less than one percent of the then adjusted total contract price, or substantially all of the
work has been completed and opened to use or occupancy except for minor incomplete
or unsatisfactory work items that do not materially impair the usefulness of the work
required by the contract.
 new text end