A supplier has filed a stop notification. for non payment. work is still going on at site. Is there a potential penalty for ignoring the stop notification
1 reply
Dec 28, 2018
That's an interesting question. First, it's worth pointing out that California is home to two types of stop notices: (1) a Stop Payment Notice, and (2) a Stop Work Notice. When the term "stop notice" or "stop notification" is used, typically, it's in reference to a stop payment notice. When such a notice is made, project funds are held up from the highest tiers of the project until the issue is resolved. However, this does not mean that work will automatically stop just because a stop payment notice has been issued. With payments in limbo, that could certainly be a result - but it's not the direct result of a stop payment notice. Despite having similar titles, stop work notices are very different. A stop work notice is sent from a direct contractor, and it informs the property owner that the sender will cease work if payment is not made. Even still - sending a stop work notice doesn't mean that work will immediately be ceased, and it doesn't mean that a party other than the one who sent notice will cease work.