The Ties That Bind, and Those That Don't: Subcontracts v. Sub-Bids

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I frequently receive phone calls from general contractors curious to know what their legal rights and obligations are with respect to subcontractors before a subcontract agreement is actually reached. Invariably, these calls entail answering one of two questions:

(1) Can I sue a subcontractor who wants to back out of its sub-bid or estimate? Or,

(2) Am I obligated to use a subcontractor upon whose sub-bid or estimate I based my prime contract price?

Generally speaking, the answer to both questions is “No.” That’s partially good news for subs, and partially good news for GC’s. Here’s why.

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