Section 71. Purpose of the trust; "trust claims"; "beneficiaries"

1. The
  trust assets of which an owner is trustee under subdivisions five (a) to
  five (f), inclusive, of section seventy of this chapter  shall  be  held
  and  applied for payment of the cost of improvement. The trust assets of
  which an owner is trustee under subdivision five (g) of section  seventy
  of  this  chapter  shall  be held and applied for payment of the cost of
  improvement and, in addition, for the  purposes  of  the  further  trust
  provided in section seventy-one-a of this chapter.
    2.  The trust assets of which a contractor or subcontractor is trustee
  shall be held and applied for the following expenditures arising out  of
  the  improvement  of real property, including home improvement or public
  improvement  and  incurred  in  the  performance  of  his  contract   or
  subcontract, as the case may be:
    (a)  payment  of  claims  of  subcontractors,  architects,  engineers,
  surveyors, laborers and materialmen;
    (b) payment of the amount of taxes based on  payrolls  including  such
  persons  and  withheld or required to be withheld and taxes based on the
  purchase price or  value  of  materials  or  equipment  required  to  be
  installed  or  furnished  in  connection  with  the  performance  of the
  improvement;
    (c)  payment  of  taxes   and   unemployment   insurance   and   other
  contributions  due  by reason of the employment out of which such claims
  arose;
    (d) payment of any  benefits  or  wage  supplements,  or  the  amounts
  necessary  to  provide such benefits or furnish such supplements, to the
  extent that the trustee, as employer, is obligated  to  pay  or  provide
  such  benefits  or furnish such supplements by any agreement to which he
  is a party;
    (e) payment of premiums on a surety bond or bonds filed  and  premiums
  on  insurance  accrued  during  the making of the improvement, including
  home improvement, or public improvement;
    (f) payment to which the owner is entitled pursuant to the  provisions
  of section seventy-one-a of this chapter.
    3.  (a) With respect to the trust of which an owner is trustee, "trust
  claims"  means  claims  of  contractors,   subcontractors,   architects,
  engineers,  surveyors,  laborers  and  materialmen  arising  out  of the
  improvement, for which the  owner  is  obligated,  and  also  means  any
  obligation  of the owner incurred in connection with the improvement for
  a payment or expenditure defined as cost of improvement.
    (b) With respect to the trusts of which a contractor or  subcontractor
  is trustee, "trust claims" means claims arising at any time for payments
  for  which  the  trustee is authorized to use trust funds as provided in
  subdivision two of this section.
    (c) No claim acquired by the trustee by assignment or otherwise  shall
  be a trust claim after it has been so acquired.
    4.  Persons having claims for payment of amounts for which the trustee
  is authorized to use trust  assets  as  provided  in  this  section  are
  beneficiaries  of  the  trust  whether or not they have filed or had the
  right to file a notice of lien  as  provided  in  article  two  of  this
  chapter  or  shall  have  recovered  a judgment therefor. Where an owner
  becomes obligated to incur  an  expenditure  as  part  of  the  cost  of
  improvement, any person to whom he is so obligated is a beneficiary.
    5. For the purposes of this article, every trust claim shall be deemed
  to  be  in  existence from the time of the making of the contract or the
  occurrence of the transaction out of which the claim arises and,  except
  as provided in section seventy-six and section seventy-seven, the rights
  of each member of the class of beneficiaries accrue at the making of the

  contract  or  the  occurrence  of the transaction out of which the claim
  arises.