U.S. Code » Title 31 » Subtitle SUBTITLE III— FINANCIAL MANAGEMENT › Chapter CHAPTER 39— PROMPT PAYMENT

31 U.S.C. § 3907

Relationship to other laws

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(a) A claim for an interest penalty not paid under this chapter may be filed under section 7103 of title 41.(b)(1) An interest penalty under this chapter does not continue to accrue—(A) after a claim for a penalty is filed under chapter 71 of title 41; or(B) for more than one year.(2) Paragraph (1) of this subsection does not prevent an interest penalty from accruing under section 7109(a)(1) and (b) of title 41 after a penalty stops accruing under this chapter. A penalty accruing under section 7109(a)(1) and (b) may accrue on an unpaid contract payment and on the unpaid penalty under this chapter.(c) Except as provided in section 3904 of this title, this chapter does not require an interest penalty on a payment that is not made because of a dispute between the head of an agency and a business concern over the amount of payment or compliance with the contract. A claim related to the dispute, and interest payable for the period during which the dispute is being resolved, is subject to chapter 71 of title 41.(Added Pub. L. 97–452, § 1(18)(A), Jan. 12, 1983, 96 Stat. 2477, § 3906; renumbered § 3907, Pub. L. 100–496, § 9(a)(1), Oct. 17, 1988, 102 Stat. 2460; amended Pub. L. 111–350, § 5(h)(8), Jan. 4, 2011, 124 Stat. 3849.)

Historical and Revision Notes

Revised Section

Source (U.S. Code)

Source (Statutes at Large)

3906(a)

31 App.:1803(a)(1).

May 21, 1982, Pub. L. 97–177, § 4, 96 Stat. 87.

3906(b)

31 App.:1803(a)(2), (3).

3906(c)

31 App.:1803(b).

In the section, the words “be construed to” are omitted as surplus.

In subsection (a), the words “not paid under this chapter” are substituted for “which a Federal agency has failed to pay in accordance with the requirements of section 2 or 3 of this chapter” to eliminate unnecessary words.

In subsection (b)(2), the word “accruing” is added for clarity. The word “both” is omitted as surplus.

In subsection (c), the words “with respect to disputes concerning discounts”, “by the required payment date”, and “other allegations concerning” are omitted as surplus.

Editorial NotesAmendments

2011—Subsec. (a). Pub. L. 111–350, § 5(h)(8)(A), substituted “section 7103 of title 41” for “section 6 of the Contract Disputes Act of 1978 (41 U.S.C. 605)”.

Subsec. (b)(1)(A). Pub. L. 111–350, § 5(h)(8)(B), substituted “chapter 71 of title 41” for “the Contract Disputes Act of 1978 (41 U.S.C. 601 et seq.)”.

Subsec. (b)(2). Pub. L. 111–350, § 5(h)(8)(C), substituted “section 7109(a)(1) and (b) of title 41” for “section 12 of the Contract Disputes Act of 1978 (41 U.S.C. 611)” and “section 7109(a)(1) and (b) may” for “section 12 may”.

Subsec. (c). Pub. L. 111–350, § 5(h)(8)(D), substituted “chapter 71 of title 41” for “the Contract Disputes Act of 1978 (41 U.S.C. 601 et seq.)”.

1988—Pub. L. 100–496 renumbered section 3906 of this title as this section.

Notes of Decisions
Cited in 27 cases (4 in the last 5 years), 1990–2024 · leading case: Sarang Corp. v. United States, 76 Fed. Cl. 560 (Fed. Cl. 2007).
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Sarang Corp. v. United States, 76 Fed. Cl. 560 (Fed. Cl. 2007). · cites it 5× “See 31 U.S.C. § 3907 (a) (“A claim for an interest penalty not paid under .”
George Sollitt Constr. Co. v. United States, 64 Fed. Cl. 229 (Fed. Cl. 2005). · cites it 2× “31 U.S.C. § 3907 . Thus, the interest penalty provided by the Prompt Payment Act is not available to a contractor for payments for which the government has disputed its liability.”
Env't Saf. Consultants, Inc. v. United States, 95 Fed. Cl. 77 (Fed. Cl. 2010). · cites it 2× “25 Here, because there is a clear dispute between the parties as to whether plaintiffs are entitled to payment on plaintiffs’ contracts with the Navy, the USACE and the NPS, the PPA does not apply, and any claims plaintiffs assert under 31 U.”
Gutz v. United States, 45 Fed. Cl. 291 (Fed. Cl. 1999). · cites it 3× “” 31 U.S.C. § 3907 (c). In that situation, a claim for interest is subject to the Contract Disputes Act of 1978, 41 U.”
Modeer v. United States, 68 Fed. Cl. 131 (Fed. Cl. 2005). “31 U.S.C. § 3907 . Thus, the interest penalty provided by the Prompt Payment Act is not available to a contractor, in this case a lessor, when the claimed payment amount is in dispute.”
Medina Constr., Ltd. v. United States, 43 Fed. Cl. 537 (Fed. Cl. 1999). “31 U.S.C. § 3907 (c); L & A Jackson Enter.”
Laurelwood Homes LLC v. United States, 78 Fed. Cl. 290 (Fed. Cl. 2007). · cites it 2× “The relevant provision of the PPA for the inquiry here provides, in pertinent part, as follows: Except as provided in section 3904 of this title, this chapter does not require an interest penalty on payment that is not made because of a dispute between the head of an agency and…”
S. Comfort Builders, Inc. v. United States, 67 Fed. Cl. 124 (Fed. Cl. 2005). “31 U.S.C. § 3907 (c). Discussing this provision, the legislative history to the Prompt Payment Act indicates: The act’s protections apply only when there is no dispute relating to a contractor’s performance in accordance with the terms and conditions of the contract.”
CPT Corp. v. United States, 25 Cl. Ct. 451 (Ct. Cl. 1992). · cites it 2× “” 31 U.S.C. § 3907 (c) (1988). In this case, since no dispute existed between the parties, interest under the PPA may be appropriate.”
GPA-I, LP v. United States, 46 Fed. Cl. 762 (Fed. Cl. 2000). “” 31 U.S.C. § 3907 (a). . The standard Federal Acquisition Regulation (FAR) clauses (applicable to contracts with invoices) allows the government 30 days from receipt of an invoice to pay, see 48 C.”
Inversa, S.A. v. United States, 73 Fed. Cl. 245 (Fed. Cl. 2006). “31 U.S.C. § 3907 (c) (emphasis added). The Plaintiffs argue that the language of the PPA addresses only two narrow types of disputes: situations in which liability for a payment is conceded but the dollar amount of the payment is disputed or, citing legislative history, disputes…”
Bay Cnty., Florida v. United States, 117 Fed. Cl. 131 (Fed. Cl. 2014). · cites it 6× “31 U.S.C. § 3907 . Both parties agreed that one year of interest under the PPA accrued on the undisputed amount, given the express terms of Subparagraph 3907(b)(1)(B).”
Show all 27 citing cases →
— 31 U.S.C. § 3907(c) — 2 cases
Seven Seas Shipchandlers LLC (A.S.B.C.A. 2016).
Amaratek (A.S.B.C.A. 2014).
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