Bill Text: VA SB208 | 2020 | Regular Session | Enrolled
Bill Title: Mechanics' liens; right to withhold payment.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Passed) 2020-04-08 - Governor: Acts of Assembly Chapter text (CHAP0873) [SB208 Detail]
Download: Virginia-2020-SB208-Enrolled.html
Be it enacted by the General Assembly of Virginia:
1. That §43-13 of the Code of Virginia is amended and reenacted as follows:
§43-13. Funds paid to general contractor or subcontractor must be used to pay persons performing labor or furnishing material.
Any contractor or subcontractor or any officer, director or
employee of such contractor or subcontractor who shall, with intent to defraud,
retain or use the funds, or any part thereof, paid by the owner or his agent,
the contractor, or the lender to such contractor or by the owner
or his agent, the contractor, or the lender to a subcontractor
under any contract for the construction, removal, repair, or improvement
of any building or structure permanently annexed to the freehold, for
any other purpose than to pay persons performing labor upon or furnishing
material for such construction, repair, removal, or improvement,
shall be is guilty of larceny in appropriating such funds for any
other use while any amount for which the contractor or subcontractor may be
liable or become liable under his contract for such labor or materials remains
unpaid, and may be prosecuted upon complaint of any person or persons
who have not been fully paid any amount due them.
The use by any such contractor or subcontractor or any
officer, director, or employee of such contractor or subcontractor of
any moneys paid under the contract, before paying all amounts due or to
become due for labor performed or material furnished for such building or
structure, for any other purpose than paying such amounts, due
on the project shall be prima facie evidence of intent to defraud. Any
breach or violation of this section may give rise to a civil cause of action
for a party in contract with the general contractor or subcontractor, as
appropriate; however, this right does not affect a contractor's or
subcontractor's right to withhold payment for failure to properly perform labor
or furnish materials on the project. Any contract or subcontract provision that
allows a contracting party to withhold funds due under one contract or
subcontract for alleged claims or damages due on another contract or subcontract
is void as against public policy.
