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HomeCivil CodeDiv. 4Pt. 6Ch. 4Art. 1§ 9358 Public Entity Payment Withholding

§ 9358 Public Entity Payment Withholding

Civil Code·California
AI Summary·Official Text·Key Terms·Related Statutes·References
AI SummaryVerified

§ 9358 Public Entity Payment Withholding

Key Takeaways

  • •If someone says they weren't paid for work on a public project, the government must hold back money from the main contractor to cover the claim.
  • •The government can use money already set aside in a special account to pay the claim instead of holding back new money.
  • •This rule helps make sure workers and suppliers get paid for their work on government projects.

Example

A small company builds a new park for the city but doesn't pay the workers who installed the playground equipment. One of the workers sends a notice to the city saying they weren't paid.

The city must hold back money they owe to the small company to make sure the worker gets paid. They can also use money already saved in a special account for the project to pay the worker.

AI-generated — May contain errors. Not legal advice. Always verify source.

Official Source
View on CA.gov

§ 9358 Public Entity Payment Withholding

(a) The public entity shall, on receipt of a stop payment notice, withhold from the direct contractor sufficient funds due or to become due to the direct contractor to pay the claim stated in the stop payment notice and to provide for the public entity’s reasonable cost of any litigation pursuant to the stop payment notice. (b) The public entity may satisfy its duty under this section by refusing to release funds held in escrow under Section 10263 or 22300 of the Public Contract Code. (Added by Stats. 2010, Ch. 697, Sec. 20. (SB 189) Effective January 1, 2011. Operative July 1, 2012, by Sec. 105 of Ch. 697 and by Section 8052.)

Last verified: January 21, 2026

Key Terms

stop payment noticepublic entitydirect contractorsufficient fundsPublic Contract Code

Related Statutes

  • § 9364 Public Contractor Release Bonds
  • § 9354 Stop Payment Notice Requirements
  • § 9360 Contractor Payment Protection Rules
  • § 9362 Stop Payment Notice Deadlines
  • § 9502 Stop Payment Notice Enforcement

References

  • Official text at leginfo.legislature.ca.gov
  • California Legislature. Civil Code. Section 9358.
View Official Source