Pub. Contract Code, § 10848

If the control of a contractor is terminated or he or she abandons the work, and the work is performed by day’s labor or informal contract as provided in Section 10845, he or she is not entitled to receive any portion of the amount to be paid under the contract until it is fully completed. After completion, if the unpaid balance exceeds the sum of the amount expended by the state in finishing the work, plus all damages sustained or to be sustained by the state, the excess not otherwise required by law to be retained shall be paid to the contractor, but if such sum exceeds the unpaid balance, the contractor and his or her surety are liable to the state for the excess. If the surety completes the contract work, as provided in Section 10845, such surety shall be subrogated to money due under the contract and to money which shall become due in the course of completion by the surety, to the extent provided by law.