Nevada Revised Statutes 338.525 – Withholding amounts for failure of contractor to comply with contract or applicable building code, law or regulation; payment of amounts withheld upon confirmation of correction of condition
1. Except as otherwise provided in NRS 338.515, a public body may, but is not required to, withhold from a progress payment or retainage payment an amount sufficient to pay the expenses the public body reasonably expects to incur as a result of the failure of the contractor to comply with the contract or applicable building code, law or regulation.
Terms Used In Nevada Revised Statutes 338.525
- Contract: A legal written agreement that becomes binding when signed.
- Contract: means a written contract entered into between a contractor and a public body for the provision of labor, materials, equipment or supplies for a public work. See Nevada Revised Statutes 338.010
- Contractor: means :
(a) A person who is licensed pursuant to the provisions of chapter 624 of NRS. See Nevada Revised Statutes 338.010
- Public body: means the State, county, city, town, school district or any public agency of this State or its political subdivisions sponsoring or financing a public work. See Nevada Revised Statutes 338.010
2. A public body shall, within 20 days after it receives a progress bill or retainage bill from a contractor, give a written notice to the contractor of any amount that will be withheld pursuant to this section. The written notice must set forth:
(a) The amount of the progress payment or retainage payment that will be withheld from the contractor; and
(b) A detailed explanation of the reason the public body will withhold that amount, including, without limitation, a specific reference to the provision or section of the contract, or any documents related thereto, or the applicable building code, law or regulation with which the contractor has failed to comply. The written notice must be signed by an authorized agent of the public body.
3. If the public body receives a written notice of the correction of the condition that is the reason for the withholding, signed by an authorized agent of the contractor, the public body shall, after confirming that the condition has been corrected, pay the amount withheld by the public body within 30 days after the public body receives the next progress bill or retainage bill.