News & Analysis as of

General Contractors Pay if Paid Construction Contracts

Baker Donelson

Louisiana Legislature Grants Sureties the Right to Raise Contractor Defenses, Including "Pay-If-Paid"

Baker Donelson on

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

PilieroMazza PLLC

Enforceability of Pay-if-Paid Clauses in Construction Subcontracts: Mid-Atlantic Region

PilieroMazza PLLC on

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

Carr Maloney P.C.

“Pay-if-paid” and “Pay-when-paid” Clauses in Virginia

Carr Maloney P.C. on

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

Carr Maloney P.C.

“Pay-if-paid” and “Pay-when-paid” Clauses in Maryland and the District of Columbia

Carr Maloney P.C. on

General Contractors may seek to condition payments to Subcontractors by using “pay-if-paid” or “pay-when-paid” clauses in their contracts. Typically, as the name suggests, pay-when-paid provisions concern the timing of...more

Clark Hill PLC

Potential Change for “Pay-if-Paid” and “Pay-when-Paid” Clauses in Michigan

Clark Hill PLC on

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

Miller Nash LLP

[Webinar] Retainage, Back Charges, and Withholdings—Law and Best Practices in Oregon & Washington - October 24th, 9:00 am - 10:30...

Miller Nash LLP on

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

Marshall Dennehey

The Lack of a Retainage Payment to a General Contractor Did Not Bar Payment to the General Contractor’s Subcontractors, Regardless...

Marshall Dennehey on

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

Marshall Dennehey

Pay-if-Paid Clause in Construction Contract Found to Be Enforceable

Marshall Dennehey on

Key Points: New Jersey Appellate Division rules on enforceability of “pay-if-paid” provision of construction contract. Court held that “pay-if-paid” provision was applicable and enforceable. Nevertheless, more litigation...more

Tonkon Torp LLP

Construction Contract Tip – What Should Subcontractors Do About Pay-if-Paid Provisions?

Tonkon Torp LLP on

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

Cohen Seglias Pallas Greenhall & Furman PC

New Jersey Appellate Court Addresses Whether Pay-if-Paid Clauses Are Enforceable

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

Cozen O'Connor

Pay-If-Paid No Longer Enforceable in Virginia

Cozen O'Connor on

On January 1, 2023, “pay-if-paid” clauses in new contracts became void as against public policy and unenforceable as a result of Virginia Senate Bill 550 (SB 550) going into effect. See Va. Code §§ 2.2-4354 and 11-4.6....more

Baker Donelson

Reminder: Beginning January 1, 2023, Virginia "Pay-if-Paid" Clauses No Longer Valid

Baker Donelson on

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

Akerman LLP

REMINDER: Starting January 1, 2023, Virginia Will Prohibit Pay-If-Paid Clauses and Limit Pay-When-Paid Clauses

Akerman LLP on

As explained in a prior update, Virginia recently enacted laws prohibiting pay-if-paid clauses in construction contracts and limiting the effectiveness of pay-when-paid clauses in certain agreements for public and private...more

Bradley Arant Boult Cummings LLP

Nevada Supreme Court holds that pay-if-paid provisions require a case-by-case analysis to determine their enforceability

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

Robinson+Cole Construction Law Zone

Subcontract Payment Provisions Mean Exactly What They Say in Connecticut

The recent Connecticut Appellate Court decision in Electrical Contractors, Inc. v. 50 Morgan Hospitality Group, LLC, 211 Conn. App. 724 (2022), eliminated any remaining doubt regarding a subcontractor’s right to payment for...more

Akerman LLP

Virginia Prohibits Pay-If-Paid Clauses and Limits Pay-When-Paid Language

Akerman LLP on

On April 27, 2022, Virginia Governor Glenn Youngkin ratified amendments to two Virginia statutes, prohibiting pay-if-paid clauses in construction contracts, and limiting the effectiveness of pay-when-paid clauses in certain...more

Bradley Arant Boult Cummings LLP

Virginia Is for Lovers… of Strict Contract Language: New Law Prohibits Pay-if-Paid Clauses in Construction Contracts

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

Cohen Seglias Pallas Greenhall & Furman PC

[Webinar] Payment Terms: A Trap for the Unwary - July 20th, 12:00 pm - 1:00 pm ET

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

Cohen Seglias Pallas Greenhall & Furman PC

Practical Training for Project Managers & Supervisors Two-Part Webinar Series: Part Two

In this webinar series, George Pallas and Kathleen Morley present practical tips and training to project managers and supervisors regarding best practices in project management. Using real-life examples, George and Kathleen...more

Cohen Seglias Pallas Greenhall & Furman PC

[Webinar] Practical Training for Project Managers & Supervisors: Part Two: Important Contract Provisions, Claims Preservation, and...

In this webinar series, George Pallas and Kathleen Morley will present practical tips and training to project managers and supervisors regarding best practices in project management. Using real-life examples, George and...more

Bradley Arant Boult Cummings LLP

Pay IF Paid: It Means What it Says - Construction and Procurement Law News, Q1 2018

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

Troutman Pepper

Kentucky Supreme Court Holds “Pay-if-Paid” Provision in Subcontract Is Valid and Enforceable, Shifting Risk to Subcontractor

Troutman Pepper on

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

Holland & Knight LLP

Illinois Court Addresses Contractual "Pay-If-Paid" Provisions - Appellate Ruling: Strict Standard is Required for Forfeiture of...

Holland & Knight LLP on

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

Faegre Drinker Biddle & Reath LLP

Illinois Appellate Court Ruling Provides (Another) Reason to Double-Check Your Payment Clauses

A recent ruling out of the First District Illinois Appellate Court makes one thing clear: contractors and subcontractors should pay close attention to payment clauses on all contract forms. In Beal Bank Nevada v. Northshore...more

Haight Brown & Bonesteel LLP

One Word Makes All The Difference – The Distinction Between “Pay If Paid” and “Pay When Paid” Clauses

Payment clauses in California construction contracts are often complex and multi-layered. This is especially true in contracts between general contractors and their subcontractors. The general does not want to pay the subs...more

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