A stop payment notice would block funds from the :

A stop payment notice would block funds from the :

• A. Owner to the Prime Contractor
• B. Lender to the Owner
• C. Subcontractor to the Supplier
• D. Insurance to the Contractor

Answer: (A)

Stop payment notices are a tool for those who supplied labor or materials to a project to secure payment by withholding funds that the owner would otherwise pay to the prime contractor. The notice directs the owner (or the owner’s paying source) to hold back a portion of the money due to the prime contractor until the claimant’s payment issue is resolved. This protects the claimant by ensuring there is money available to pay them even if the prime contractor isn’t promptly paying their bills. So, the funds that get blocked are those the owner would pay to the prime contractor, not money moving between lenders, subcontractors and suppliers, or insurance flows.

Stop payment notices are a tool for those who supplied labor or materials to a project to secure payment by withholding funds that the owner would otherwise pay to the prime contractor. The notice directs the owner (or the owner’s paying source) to hold back a portion of the money due to the prime contractor until the claimant’s payment issue is resolved. This protects the claimant by ensuring there is money available to pay them even if the prime contractor isn’t promptly paying their bills. So, the funds that get blocked are those the owner would pay to the prime contractor, not money moving between lenders, subcontractors and suppliers, or insurance flows.