3934 - Withholding of payment for good faith claims.

     § 3934.  Withholding of payment for good faith claims.        (a)  When government agency may withhold payment.--The     government agency may withhold payment for deficiency items     according to terms of the contract. The government agency shall     pay the contractor according to the provisions of this     subchapter for all other items which appear on the application     for payment and have been satisfactorily completed. The     contractor may withhold payment from any subcontractor     responsible for a deficiency item. The contractor shall pay any     subcontractor according to the provisions of this subchapter for     any item which appears on the application for payment and has     been satisfactorily completed.        (b)  Notification when payment withheld for deficiency     item.--If a government agency withholds payment from a     contractor for a deficiency item, it shall notify the contractor     of the deficiency item within the time period specified in the     contract or 15 calendar days of the date that the application     for payment is received. If a contractor withholds payment from     a subcontractor for a deficiency item, it must notify the     subcontractor or supplier and the government agency of the     reason within 15 calendar days of the date after receipt of the     notice of the deficiency item from the government agency.        Cross References.  Section 3934 is referred to in sections     3933, 3935 of this title.