BILL NUMBER: AB 2042	CHAPTERED
	BILL TEXT

	CHAPTER   111
	FILED WITH SECRETARY OF STATE   JULY 6, 1998
	APPROVED BY GOVERNOR   JULY 3, 1998
	PASSED THE SENATE   JUNE 18, 1998
	PASSED THE ASSEMBLY   MAY 14, 1998

INTRODUCED BY   Assembly Member Goldsmith

                        FEBRUARY 18, 1998

   An act to amend Section 3186 of the Civil Code, relating to public
works.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 2042, Goldsmith.  Public works:  stop notices.
   Existing law specifies the issuance and enforcement of stop
notices for public works.  It is the duty of a public entity to
withhold from the original contractor, or any person acting under his
or her authority, money or bonds due or to become due to the
contractor in an amount sufficient to answer the claim stated in the
stop notice and to provide for the reasonable cost of litigation
thereunder.
   This bill would recast this duty to state that the amount withheld
shall be sufficient to provide for the public entity's reasonable
cost of litigation thereunder, rather than the cost of litigation
thereunder.  The bill would authorize the public entity to satisfy
this duty by refusing to release money held in escrow, as specified.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 3186 of the Civil Code is amended to read:
   3186.  It shall be the duty of the public entity, upon receipt of
a stop notice pursuant to this chapter, to withhold from the original
contractor, or from any person acting under his or her authority,
money or bonds (where bonds are to be issued in payment for the work
of improvement) due or to become due to that contractor in an amount
sufficient to answer the claim stated in the stop notice and to
provide for the public entity's reasonable cost of any litigation
thereunder.  The public entity may satisfy this duty by refusing to
release money held in escrow pursuant to Section 10263 or 22300 of
the Public Contract Code.