North Carolina Account Stated for Construction Work refers to a legal concept that governs payment disputes between parties involved in construction projects in North Carolina. It is crucial for contractors, subcontractors, suppliers, and property owners to understand the intricacies of this concept to protect their rights and ensure fair compensation. When construction work is performed, an account stated is a final statement of the total amount owed for the completed work, materials provided, and any additional services rendered. This statement summarizes all the charges, including labor costs, material costs, equipment rentals, permits, and other expenses. It serves as an agreement between the parties involved on the amount owed, establishing a baseline for payment. In North Carolina, there are various types of Account Stated for Construction Work: 1. Original Account Stated: This refers to the initial agreement or statement between the contractor and the property owner, which outlines the proposed costs for the construction work. It sets the foundation for subsequent account stated statements as the project advances. 2. Revised Account Stated: In case there are changes or revisions to the initial agreement, a revised account stated is created. This accounts for any modifications in the scope of work, material selections, change orders, or unforeseen circumstances that impact the overall cost of the project. 3. Subcontractor Account Stated: A subcontractor may issue an account stated statement to the general contractor, specifying the amount owed by the general contractor for the services rendered. This document serves as a formal demand for payment and prompts discussions related to the final payment. 4. Supplier Account Stated: Suppliers of construction materials may prepare an account stated statement for the contractor, listing the total value of the materials provided to the project. It helps in tracking expenses and acts as a request for timely payment from the contractor. When disputes arise regarding the account stated for construction work in North Carolina, it is crucial to adhere to relevant legal guidelines. Each party may seek legal recourse through methods such as negotiation, mediation, arbitration, or filing a lawsuit, depending on the severity of the disagreement. Understanding North Carolina Account Stated for Construction Work is essential for all project stakeholders to safeguard their financial interests, avoid payment disputes, and ensure a smooth construction process from start to finish.
North Carolina Account Stated for Construction Work
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FAQ
The N.C.G.S. 87-1 defines a general contractor as a person, firm or corporation who manages or oversees construction projects where the cost of the project is $40,000 or greater. The State General Contractors License is not required if a project is under $40,000.
In North Carolina, the statute of limitations for most construction disputes, such as breach of contract or implied warranty of plans, is generally three years from the date when the claimant knows or should know they have a claim.
Retention is an amount of money withheld from a contractor until a job is complete. This normally is 5-10% of the contract's sum. It acts as a kind of security deposit: if defects are left by the contractor that they fail to remedy, the money is rightfully retained by the employer to fix those defects.
Retainage, also called retention, is an amount withheld from the contractor until a later date. It's fairly common, especially on commercial and public construction projects, and typically ranges from 5 - 10% of the total contract price.
A common construction contract usually states that the amount of retention money is 5% of the contract's value or a 10% deduction for every progress payment you receive. You should see this amount of retention money in your payment invoice.
Does North Carolina limit the amount of retainage that can be withheld? Retainage is limited to 5% of each progress payment until 50% completion of the project. Upon 50% completion, retainage will not be withheld from any subsequent payments.
If the owner retains funds, the amount retained shall not exceed two and one-half times the estimated value of the work to be completed or corrected. Any reduction in the amount of the retainage on payments shall be with the consent of the contractor's surety.
A: There is no limit by law, but it should be a negotiated sum between the homeowner and contractor. Generally, deposits should be limited to around 10% of the contract price, but this also depends on the remaining pay schedule. Contractors typically ask for deposits for material costs.