§ 803. Use or application of money received by contractor.
323 words·~1 min read·
/de/title-17/chapter-8-highway-construction-payments/803·A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
(a)No contractor, or agent of a contractor, shall pay out, use or appropriate any money or funds described in § 802 of this title until they have first been applied to the payment of the full amount of all moneys due and owing by the contractor to all persons furnishing labor or material for the erection, construction, completion, authorization or repair of any highway, right-of-way, turnpike or toll express highways, including shoulders, median strips, parkways and islands, by such contractor, whether or not the labor or material entered into or became a component part of any such highway right-of-way, turnpike or toll express highways, including shoulders, median strips, parkways and islands, and whether or not the same were furnished on the credit of such highway right-of-way, turnpike or toll express highways, including shoulders, median strips, parkways and islands, or on the credit of such contractor.
(b)All general contractors or agents of any general contractor receiving funds impressed with a trust under this chapter shall, within 30 days of receipt of any payment, file a statement in a form to be determined by the Division of Highways, with the contracting state agency that the contractor or the contractor’s agent has paid all subcontractors furnishing labor or material the full sum due them at that stage of the contract, except any funds withheld under the terms of the contract.
(c)In any instance where the contract stipulates that the general contractor will receive a series of prorated payments the general contractor or the general contractor’s agents shall, upon the receipt of each payment, pay all subcontractors furnishing labor or materials, who have properly completed all work required of them at that stage of the contract, according to the same prorated formula which governs payments to the general contractor, i.e., if the general contractor receives 10% initially, persons furnishing labor and materials will receive 10% initially, and so through the course of the contract.