Working in Texas for a contractor. Said contractor paid money to our vendor and said they would deduct from retainage on said project. Waivers were signed and joint checks were made. We have know completed a different project with same contractor and are expecting payment on new project, however contractor is trying to hold the amount paid to vendor on other project out of payment on new project. Is this legal? We have different contract for each project and are still owed retainage on old project.
The legal analysis would start with a review of your contract, and then extend to any pertinent documents and communications.
Retain a construction attorney to evaluate your legal situation and to provide advice.
If your contract permits the contractor to deduct the contractor's claims on other projects, then the contractor may do so. If not, then you can make claim for the money owed, but the contractor will likely assert a defensive claim for the money owed on the other project.