§ 756-c. Retention. By mutual agreement of the relevant parties an
owner may retain no more than five per centum of the contract sum as
retainage. A contractor or subcontractor may also retain no more than
five per centum for retainage and in no case shall retainage exceed the
actual percentage retained by the owner. Retainage shall be released by
the owner to the contractor no later than thirty days after the final
approval of the work under a construction contract. In the event that an
owner fails to release retainage as required by this article, or the
contractor or subcontractor fails to release a proportionate amount of
retainage to the relevant parties after receipt of retainage from the
owner, the owner, contractor, or subcontractor, as the case may be,
shall be subject to the payment of interest at the rate of one percent
per month on the date retention was due and owing.