Payment to subcontractors and suppliers

(1) When a contractor receives any construction funds from an owner or another contractor for work performed and billed, the contractor receiving funds shall pay each of that contractor's subcontractors and suppliers in proportion to the percentage of the work they performed under that billing, unless otherwise agreed by contract. (2) If, under this section and without reasonable cause, or unless otherwise agreed by contract, the contractor fails to pay for work performed by subcontractors or suppliers within 30 consecutive days after receiving construction funds from the owner or another contractor for work performed and billed, or after the last day payment is due under the terms of the billing, whichever is later, the contractor receiving funds shall pay to the subcontractor or supplier, in addition to the payment, interest in the amount of 1% per month of the amount due, beginning on the day after payment is due, and reasonable costs of any collection and attorney fees. (3) When a subcontractor receives any construction payment under this section, Subsections (1) and (2) apply to that subcontractor.