On a private project, a direct (general) contractor receives a progress payment from the owner. Within how many days must it pay each subcontractor that subcontractor's share?
Explanation
B&P §7108.5 gives the direct contractor 7 days from receipt of a progress payment to pass each subcontractor its share (b), and §7108.5(b) charges a 2%-per-month penalty plus attorney's fees on amounts wrongfully withheld. (c) 10 days is the separate deadline in Civil Code §8814 for releasing withheld RETENTION to a subcontractor once the owner releases it — a different payment under a different statute, which is why the stem names the progress payment. (a) 3 days and (d) 30 days appear in neither section; 30 days is the kind of term a private contract might try to impose, but §7108.5 cannot be bargained down to it.
Law Reference: Bus. & Prof. Code §7108.5This topic, taught in full in the CSLB Law & Business guide. CSLB Law & Business — Complete Study Guide (2026) — PDF + EPUB, $24.99 · 14-day refund →
Practice all 1632 questions free — no signup required.
Own the complete CSLB Law & Business guide — PDF + EPUB, $24.99 →
Related questions on this topic
- Which contract type places the MOST financial risk on the contractor?
- A subcontractor fails to complete their scope of work on a project. The prime contractor's primary recourse is:
- California's "prompt payment" law requires owners to pay general contractors within how many days of a proper invoice?
- A contractor is hired to build a room addition. After completion, the homeowner claims defects. The contractor's written warranty on new residential construction must be at least:
- On a $40,000 home improvement contract, what is the maximum down payment a contractor may legally demand or accept before work begins?
- On a $6,000 home improvement contract, what is the maximum allowable down payment?
Last reviewed: · editorial process