(

a) In each written contract for private works of improvement entered into on or after January 1, 1996, the contracting party and the design professional may agree to contractual provisions that include a late payment penalty, in lieu of any interest otherwise due. The terms of the late payment penalty shall be specifically set forth in the written contract. (

b) The penalty authorized pursuant to subdivision (

a) shall be separate from, and in addition to, the design professionals liens provided by

Chapter 3 (commencing with

Section 8300) of Title of Part of Division 4, mechanics liens provided by

Chapter 4 (commencing with

Section 8400) of Title of Part of Division 4, and stop payment notices provided by

Chapter 5 (commencing with

Section 8500) of Title of Part of Division 4. (

c) None of the rights or obligations created or permitted by this

section between design professionals and contracting parties shall apply to construction loan funds held by a lender pursuant to a construction loan agreement. (

d) For purposes of this section, the following

definitions apply: (1) “Contracting party” means any person or entity entering into a written contract with a design professional for professional design services for a private work of improvement. (2) “Design professional” means a person licensed as an architect pursuant to

Chapter 3 (commencing with

Section 5500) of Division of the Business and Professions Code, registered as a professional engineer pursuant to

Chapter 7 (commencing with

Section 6700) of Division of the Business and Professions Code, or licensed as a land surveyor pursuant to

Chapter 15 (commencing with

Section 8700) of Division of the Business and Professions Code.