General Background on the Missouri Prompt Payment Act
Are you a contractor that has not been paid on a construction project? Looking for an attorney to help you collect?
You might be able to get your attorney’s fees paid for, and you might be able to reap the benefits of a number of other perks that accompany a Missouri Prompt Payment Act claim.
The Missouri Prompt Payment Act is a group of statutes given the prompt payment title because of their ultimate purpose–these statutes were enacted to ensure that contractors on a construction project are expeditiously paid.
The legislature noticed that contractors’ or owners’ failure to make payment on a construction project was becoming a significant problem, and there needed to be a remedy.
Thus, the legislature incentivized payment by imposing various penalties.
This article was written to discuss a few of those penalties as well as the benefits for contractors that make a Missouri Prompt Payment Act claim.
1. Immediate Payment on the Project
As stated above, the goal of the Missouri Prompt Payment Act is to pressure the owner or general contractor into making payment as quickly as possible, so the contractor claimant receives the money to which s/he/it is entitled.
The statute sets forth the time at which payment should be made. The statute, R.S.Mo. section 431.180, the Missouri Private Prompt Payment Act, defers to the contract: “all persons who entered into a contract for private design or construction work after August 28, 1995, shall make all scheduled payments pursuant to the terms of the contract.”
In the event that those persons do not make payment, the statute provides a civil remedy that comes with other perks.
2. A Means to Pay for Your St. Louis Construction Law Attorney
Despite the incurrence of unwanted fees from hiring an attorney, you might be able to recover any monies paid out for attorney’s fees pursuant to Missouri statutes.
If you hire a St. Louis Construction Law Attorney, the statute provides a means to pay for him or her.
The statute states the following: “[t]he court may in addition to any other award for damages, award…reasonable attorney fees, to the prevailing party.” R.S.Mo. section 431.180.
Keep in mind that attorney’s fees are not guaranteed.
The statute merely provides the potential to collect attorney’s Fees. In any case, the potential to collect attorney’s fees creates leverage in the settlement of construction project disputes and that puts pressure on the owner or the non-paying contractor to immediately make payment.
If that entity or person fails to pay, they take the risk of potentially paying your attorney’s bill too.
3. 18% Interest Rate for Unpaid Work under the Contract
The Missouri Prompt Payment Act Provides for an 18% interest rate. This is an incredible rate considering the ordinary statutory rate in Missouri is 9%.
From the time a claim becomes liquidated (an undisputed amount that is due and owing), interest begins to accrue. This is a heavy burden for a non-paying owner or general contractor to foot if they wish to challenge the amounts because litigation could last for several years.
If the court or jury finds against the non-paying owner or contractor, they could also be footing a heavy bill as a result of the additional interest. For this reason, you should consult a competent St. Louis Construction lawyer to help you determine your rights and decide whether payment should be forthcoming or whether a party has legitimate grounds to withhold payment.
This article just told you about three benefits that a contractor can avail himself of through the Missouri Prompt Payment Act, when attempting to collect payment on a construction project.
The three advantages a contractor has by using the Missouri Prompt Payment Act are the following:
- The statute calls for immediate payment in accordance with the contractual terms thereof.
- The statute provides for attorney’s fees to the prevailing party–remember this is discretionary.
- The statute also provides for 18% interest on amounts due and owing, which is twice the normal Missouri statutory interest rate.
For all of the above reasons, the Missouri Prompt Payment Act can be a very effective tool for contractors who are attempting to collect on a construction project.
Because litigation can be a very complex process, contractors that need help collecting for work performed should contact a St. Louis construction law attorney for assistance.