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


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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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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