2005 Idaho Code - 29-115 — CONSTRUCTION CONTRACTS

                                  TITLE  29
                                  CONTRACTS
                                  CHAPTER 1
                   GENERAL PROVISIONS RELATING TO CONTRACTS
    29-115.  CONSTRUCTION CONTRACTS. (1) This section is applicable with
respect to all contracts entered into on or after July 1, 1990, between owners
and original contractors relating to the construction of any private work of
improvement.
    (2)  In any contract relating to the construction of any private work of
improvement, the retention proceeds withheld by the owner from the original
contractor or by the original contractor from any subcontractor from any
payment shall not exceed five percent (5%) of the payment and in no event
shall the total retention withheld exceed five percent (5%) of the contract
price. However, the five percent (5%) maximum that may be withheld does not
apply if the original contractor or the subcontractor fails to provide a
performance bond issued by a surety acceptable to the owner or original
contractor if requested to do so by the owner or original contractor
respectively. The five percent (5%) maximum shall not apply to any contract
for the performance of a private work of improvement to residential real
property consisting of one (1) to four (4) units occupied or to be occupied by
the owner.
    (3)  Within thirty-five (35) days from the date on which the work of
improvement is substantially complete, as mutually agreed to by the parties to
the contract, the retention withheld by the owner shall be reduced to the
lesser of one hundred fifty percent (150%) of the estimated value of work yet
to be completed in accordance with the contract or the retention then withheld
by the owner, not to exceed five percent (5%) of the contract price.
    Within thirty-five (35) days from the date of final completion of the work
of improvement, the retention withheld by the owner shall be released, except
in the event of a dispute between the owner and the original contractor, the
owner may withhold from the final retention payment an amount not to exceed
one hundred fifty percent (150%) of the estimated value of the issue in
dispute. The owner may condition the final release of the retention upon
receipt of satisfactory lien waivers from all persons with actual or potential
lien claims on the work of improvement.
    (4)  Subject to subsection (5) of this section, within ten (10) days from
the time that all or any portion of the retention proceeds are received by the
original contractor, the original contractor shall pay each of its
subcontractors from whom retention has been withheld, each subcontractor's
share of the retention received. However, if a retention payment received by
the original contractor is specifically designated for a particular
subcontractor, payment of the retention shall be made to the designated
subcontractor.
    (5)  The original contractor shall not be required to pay the retention to
a subcontractor if a bona fide dispute exists between the subcontractor and
the original contractor. The amount withheld from the retention payment shall
not exceed one hundred fifty percent (150%) of the estimated value of the work
yet to be completed or issue in dispute.
    (6)  It shall be against public policy for any party to require any other
party to waive any provision of this statute.