# Title 13 — Debtor and Creditor Relationship

## Chapter 13-01.1 — Interest on Delinquent Accounts

### § 13-01.1-01. Prompt payment required.

Every state agency, political subdivision, or school district, which acquires property or
services pursuant to a contract with a business shall pay for each complete delivered item of
property or service on the date required by contract between such business and agency or, if no
date for payment is specified by contract, within forty-five days after receipt of the invoice
covering the delivered items or services. The acquisition of property includes the rental of real or
personal property.
### § 13-01.1-02. When interest payment required.

Interest must accrue and be made on payments overdue under section 13-01.1-01 at the
rate of one and three-fourths percent per month, unless a different rate is specified within the
contract upon which the claim is based. Interest must accrue beginning on the day after
payment is due, if payment due date is specified by contract, or on the day of receipt of the
invoice covering the delivered goods or services, if payment is not made within forty-five days.
Interest ceases to accrue on the date payment is made.
### § 13-01.1-03. Interest must compound.

Any interest which remains unpaid at the end of any forty-five-day period or which remains
unpaid at the end of any specified period provided by contract must be added to the principal
amount of the debt and must thereafter accumulate interest.
### § 13-01.1-04. Additional appropriation prohibited.

An agency of the state is prohibited from seeking additional appropriations to pay interest
which accrues as a result of the agency's failure to make payments as required by section
13-01.1-01.
### § 13-01.1-05. When this chapter is inapplicable.

If the agency or business fails to timely pay interest as required by sections 13-01.1-02 and
dispute between the business and a subcontractor or supplier, over the amount due or over
compliance with the contract, the provisions of this chapter are inapplicable. If the settlement of
a dispute is found in favor of the business, or the subcontractor or supplier, interest must accrue
and be paid as provided in section 13-01.1-03.
### § 13-01.1-06. Subcontractor prompt payment required.

Upon payment by a state agency, political subdivision, school district, or agency of the
United States, a business which has acquired under contract, property or services in connection
with its contract with such agency, political subdivision, or school district, from a subcontractor
or supplier, shall pay such subcontractor or supplier within forty-five days after payment from
such agency. Interest at the rate specified in section 13-01.1-02 accrues and is due any
subcontractor or supplier who is not paid within forty-five days after the business receives
payment from the agency, political subdivision, or school district, unless otherwise provided by
contract between the business and the subcontractor or supplier.
