Legal Question in Construction Law in California

Yes, if the contractor was responsible for the delays and the completion date was a specific term of the contract. In fact you can deduct any and all consequential damages for failure to complete on time, such as furniture storage, extra commuting costs, etc. that are sometimes incurred. Unfortunately causation and responsibility for construction delays is rarely as cut and dried as it seems. In my past life I was a construction litigator for the City Attorney's Office of the City and County of San Francisco, including a stint as Construction Counsel to S.F. International Airport. I approved budgets in the high six-figures and even one seven figure contract for scheduling and delay consultants to provide expert testimony on the causes and duration of construction delays. Not that it would cost you that in your case, but just to show you how complex those issues can become. Since the contractor has lien rights against your property, you can set yourself up for a fight that can get big fast when you don't pay your contractor. That doesn't mean you need to just roll over, but a negotiated deduction is probably a far better route than just withholding part of the payment and telling the contractor to "pound nails."