House Bill No. 638, introduced by Representative Jacob Landry, aims to enhance the prompt payment process for contractors and subcontractors in Louisiana. The bill amends existing law by changing the focus from late payments to prompt payments, establishing a clear procedure for payments from owners to contractors, and from contractors to subcontractors and suppliers. Specifically, it mandates that owners must pay contractors within 35 days of receiving a written payment request, with penalties of 1.5% per day on overdue amounts. Additionally, contractors are required to pay subcontractors and suppliers within seven days of receiving payment from the owner, also subject to the same penalty for late payments.

The bill also addresses the issue of disputes regarding payment amounts, stipulating that any undisputed amounts must be paid promptly, while interest on unpaid amounts accrues at a rate of 1.5% per day until payment is made or a judgment is rendered. Furthermore, it allows for legal action to collect owed payments and associated penalties, with the prevailing party entitled to court costs and attorney fees. Notably, the provisions of this bill do not apply to construction or improvements made to immovable property used for residential purposes.

Statutes affected:
HB638 Original: 9:2784(A)