§ 5-16-5-1 — Withholding final payments; filing claims for payment; release of surety

Indiana § 5-16-5-1

• Jurisdiction: Indiana
• Title 5: STATE AND LOCAL ADMINISTRATION
• Art. 16: PUBLIC WORKS
• Ch. 5: Withholding and Bond to Secure Payment of

Text

(a) Except as otherwise provided in this chapter,
when a public work is performed under contract at the expense of the
state or a commission created by law, the public body shall withhold
final payment to the contractor until the contractor has paid to:
(1) all subcontractors;
(2) all suppliers of materials for material furnished;
(3) all labor employed in the public work; and
(4) all those furnishing any service in relation to or in connection
with the public work;
all bills due and owing to the persons described in subdivisions (1)
through (4) who have filed a claim under subsection (c).
(b) If there is not a sufficient sum owing to the contractor on the
contract to pay all the bills, then the sum owing on the contract shall be
prorated in payment of all the bills among the persons entitled to
payment.
(c) A person claiming payment under this section must file with the
public body a claim not later than sixty (60) days after the last labor is
performed, the last material is furnished, or the last service is rendered
by that person, as provided in section 2 of this chapter.
(d) If there is no dispute among the claimants, the public body shall
pay all claims out of the funds due the contractor and take a receipt for
each payment. The total of amounts paid under this subsection shall be
deducted from the contract price.
(e) If there is a dispute among the claimants, the public body shall
retain sufficient funds until the dispute is settled, the correct amounts
are determined, and payment of those amounts shall be made as
provided in subsection (d).
(f) Except for amounts required to be withheld under subsection (e)
or as otherwise provided in this chapter, this chapter does not preclude
a full, final, and complete settlement upon a contract with a contractor
after thirty (30) days from the date of the completion and acceptance
of the work as completed.
(g) The surety of a contractor may not be released until the
expiration of one (1) year after the final settlement with the contractor.
Formerly: Acts 1911, c.173, s.1; Acts 1925, c.44, s.1; Acts
1931, c.168, s.1; Acts 1933, c.258, s.1. As amended by Acts 1981,
P.L.57, SEC.10; P.L.75-2012, SEC.7.