Finance Committee - Agenda - 2/17/2021 - P217
Work for which Certificates for Payment have been previously issued and payments
received from the OWNER shall, to the best of the CONTRACTOR’s knowledge,
information and belief, be free and clear of liens, claims, security interests or other
encumbrances adverse to the OWNER’s interests.
5. OWNER shall make payments, for work satisfactorily completed and accurately invoiced,
on the basis of CONTRACTORSs Application for Payment, within 30 days of approval by
the OWNER.
6. The CONTRACTOR shall promptly pay each subcontractor and supplier out of the
amount paid to the CONTRACTOR on account of such entities’ portion of the Work.
7. The OWNER shall have no responsibility for the payment of money to a subcontractor or
supplier.
8. An Application for Payment, a progress payment, or partial or entire use or occupancy of
the project by the OWNER shall not constitute acceptance of Work not in accordance with
the requirements of the Contract Documents.
9. Substantial completion is the stage in the progress of the Work when the Work or
designated portion thereof is sufficiently complete in accordance with the Contract
Documents so the OWNER can occupy or utilize the Work for its intended use.
10.When the Work or designated portion thereof is substantially complete, the
CONTRACTOR and OWNER shall establish responsibilities for completion and shall fix
the time within which the CONTRACTOR shall finish all items on the list accompanying
the Certificate. Warranties required by the Contract Documents shall commence on the
date of Substantial Completion of the Work or designated portion thereof unless otherwise
provided in the Certificate of Substantial Completion.
11. Upon receipt of a final Application for Payment, the OWNER will inspect the Work.
When he finds the Work acceptable and the Contract fully performed, the OWNER will
promptly issue a final Certificate for Payment.
12. Acceptance of final payment by the CONTRACTOR, a subcontractor or supplier shall
constitute a waiver of claims by that payee except those previously made in writing and
identified by that payee as unsettled at the time of final Application for Payment.
ARTICLE 12— RETAINAGE
1. The OWNER will retain a portion of the progress payment, each month, in accordance with
the following procedures:
a. The OWNER will establish an escrow account in the bank of the OWNER’s
choosing. The account will be established such that interest on the principal will be
paid to the CONTRACTOR. The principal will be the accumulated retainage paid
into the account by the OWNER. The principal will be held by the bank, available
only to the OWNER, until termination of the contract.
b. Until the work is 50% complete, as determined by the OWNER, retainage shall be
10% of the monthly payments claimed. The computed amount of retainage will be
deposited in the escrow account established above.
C. After the work is 50% complete, and provided the CONTRACTOR has satisfied
the OWNER in quality and timeliness of the work, and provided further that there
is no specific cause for withholding additional retainage no further amount will be
withheld. The escrow account will remain at the same balance throughout the
remainder of the project.
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