Practical Training for Project Managers & Supervisors Two-Part Webinar Series: Part Two
Governor Landry recently signed into law two legislative acts that should allow Private Works Act and Public Works Act payment bond sureties to rely on defenses available to their general contractor principals in defense of...more
Pay-if-paid clauses are conditional payment provisions regularly included in construction subcontracts. The intent of these clauses is to shift the risk of loss from a prime contractor to its subcontractors by making a...more
Similar to its neighbors in Maryland and the District of Columbia, Virginia has analyzed its treatment of the “pay-if-paid” or “pay-when-paid” clauses in construction contracts. Virginia previously allowed pay-if-paid clauses...more
To understand the difference between the two contractual clauses, it is important for general contractors and subcontractors to know the following: A “pay-if-paid” clause makes payment of the general contractor by the owner...more
In 2023, the Private Contractor and Subcontractor Prompt Payment Act of 20131 (the Act) was amended to include additional protections for subcontractors on private projects by limiting a contractor’s setoff rights related to...more
No matter your tier in the construction contracting chain, understanding the nuanced rules and procedures about retainage, back charges, and other payment withholdings is critical to managing cash flow and protecting your...more
As addressed in the unreported case of J &M Interiors, Inc. v. Centerton Square Owners, LLC, (A-2536-19, 2021 WL 1976648 (N.J. Super. Ct. App. Div. May 18, 2021), the lack of a retainage payment to a general contractor (GC)...more
Almost every subcontract I see includes some type of “pay-if-paid” provision, meaning the general contractor (GC) is not required to pay the subcontractor until and if the GC receives payment from the owner. The precise...more
Virginia has joined the ranks of states that ban “pay-if-paid” clauses. Contingent payment clauses, like “pay-if-paid” and “pay-when-paid” clauses, protect contractors: A contractor need not pay its subcontractors or...more
In the construction industry, a “pay-if-paid” provision is common in subcontracts, which conditions a general contractor’s obligation to make payment to a subcontractor on the general contractor’s actual receipt of payment...more
On January 1, 2023, SB 550 will take effect, invalidating pay-if-paid clauses in construction contracts in Virginia. With this change on the immediate horizon, contractors should update their contracts and policies to adapt....more
A “pay-if-paid” provision typically makes payment by an owner to a general contractor a condition precedent to the general contractor’s obligation to pay a subcontractor for work the subcontractor has performed....more
Imagine you are an electrical subcontractor working in Virginia for a general contractor on a commercial project. Because you perform electrical work, much of your scope falls after framing and roofing, and after the envelope...more
Virginia has joined the growing number of states that prohibit “pay-if-paid” clauses. The new law, known as Virginia Senate Bill 550, amends Virginia’s Prompt Payment Act (Va. Code § 2.2-4354) and its relatively new (July 1,...more
This article is a continuation of Monday’s article, and we will be discussing in detail the new payment terms for all construction contracts in Virginia....more
As everyone in the construction industry knows, timely payment is essential. However, the payment process can be complicated, with unexpected issues throwing plans off course. In their second webinar of 2021, Cohen...more
Changes to Remedies in Lien Enforcement Actions - New legislation in Tennessee has limited the recovery of attorney’s fees, expenses, and actual and liquidated damages in instances where a real property owner seeks to...more
Connelly Constr. Corp. v. Travelers Cas. & Surety Co. of Am., 2018 U.S. Dist. LEXIS 123009 (E.D. Pa. July 24, 2018). The Commonwealth of Pennsylvania Department of General Services undertook a project for the construction...more
Pay when paid clauses are common in the construction industry. A typical pay when paid clause sounds something like this: “Prime Contractor will not pay Subcontractor until Prime Contractor receives payment from Owner.” ...more
The Louisiana First Circuit recently held that a Private Works Act payment bond surety cannot raise a pay-if-paid provision in its principal's contract as a defense to a claim against the bond. Bear Industries, Inc. v....more
Superior Steel, Inv. v. Ascent at Roebling’s Bridge, LLC, 2017 Ky. LEXIS 511 (December 14, 2017) - Corporex Development and Construction Management, LLC (“Corporex”), a design builder, contracted with Dugan & Meyers...more
The Illinois First District Appellate Court recently addressed the longstanding principle in A.A. Conte Inc. v. Campbell-Lowrie-Lautermilch Corp., 132 Ill. App. 3d 325 (1st Dist. 1985), of barring payments by general...more
I suppose that it is apropos that I have been delayed in writing this final piece in the four-part Limitations of Liability series, relating to subcontract pay if paid and flow through clauses. Being more than one step...more
This is the first post in the four-part series “Limitations of liability—The Elephant in the Room.” One or more of the following scenarios takes place in my office virtually every day...more
Pay-if-paid clauses provide that a general contractor is not required to pay subcontractors unless and until it receives payment from the owner. The ConsensusDocs Standard Agreement 655 provides the following example: Receipt...more