§4007. Disputes; penalties; attorneys' fees

Link to law: http://legislature.vermont.gov/statutes/section/09/102/04007
Published: 2015

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The Vermont Statutes Online



Commerce and Trade






4007. Disputes; penalties; attorneys' fees

(a) Nothing in

this chapter shall prevent an owner, contractor, or subcontractor from

withholding payment in whole or in part under a construction contract in an

amount equalling the value of any good faith claims against an invoicing

contractor or subcontractor, including claims arising from unsatisfactory job

progress, defective construction, disputed work, or third-party claims.

(b) If

arbitration or litigation is commenced to recover payment due under the terms

of this chapter and it is determined that an owner, contractor, or

subcontractor has failed to comply with the payment terms of this chapter, the

arbitrator or court shall award, in addition to all other damages due and as a

penalty, an amount equal to one percent per month of all sums as to which

payment has wrongfully been withheld. An amount shall not be deemed to have

been wrongfully withheld to the extent it bears a reasonable relation to the

value of any claim held in good faith by the owner, contractor or subcontractor

against which an invoicing contractor, or subcontractor is seeking to recover



Notwithstanding any contrary agreement, the substantially prevailing party in

any proceeding to recover any payment within the scope of this chapter shall be

awarded reasonable attorney's fees in an amount to be determined by the court

or arbitrator, together with expenses. (Added 1991, No. 74, § 1, eff. Jan. 1,