California Codes, Civil Code - CIV, Division 4 — General Provisions, Part 6 — Works of Improvement, Title 3 — Public Work of Improvement, Chapter 4 — Stop Payment Notice, Article 1 — General Provisions, Section 9360

(a) This chapter does not prohibit payment of funds to a direct contractor or a direct contractor’s assignee if a stop payment notice is not received before the disbursing officer actually surrenders possession of the funds.

(b) This chapter does not prohibit payment of any amount due to a direct contractor or a direct contractor’s assignee in excess of the amount necessary to pay the total amount of all claims stated in stop payment notices received by the public entity at the time of payment plus any interest and court costs that might reasonably be anticipated in connection with the claims.