Scott Halberstadt | TALG While it has been more than twenty years since the California Supreme Court determined, in Wm. R. Clarke Corp. v. Safeco Ins. Co., that “pay-if-paid” provisions in subcontracts were unenforceable, following a recent decision from the Court of Appeal, Fourth Appellate District, general contractors, or any other contractors that contract directly with owners,… Continue reading General Contractors: The Payment Provisions in Your Subcontracts May Have Just Been Determined to be Unenforceable
Tag: Pay-if-Paid Clause
Recent Court Decision Affects Enforceability of Pay-When-Paid Clauses
Mary A. Salamone | Procopio Cory Hargreaves & Savitch Construction contracts are exchanged so routinely that it is not uncommon for contractors to give the documents a quick glance or not even read them altogether before signing. Even when a contractor examines a contract thoroughly, legal terminology with profound impact may be overlooked. Since it… Continue reading Recent Court Decision Affects Enforceability of Pay-When-Paid Clauses
“Pay-When-Paid”: Is there a “Reasonable Time” for Subcontractors to Wait for Payment Once Contractor-Owner Litigation Ensues?
Christopher M. Wise | The Dispute Resolver Obviously, subcontractors prefer to be paid within a reasonable time, but the issue of what constitutes a “reasonable time” has been a conundrum many states have tackled over the years. From “pay-if-paid” to “pay-when-paid” provisions, states have either adopted one, both, or neither of these commonly controversial, heavily… Continue reading “Pay-When-Paid”: Is there a “Reasonable Time” for Subcontractors to Wait for Payment Once Contractor-Owner Litigation Ensues?
Be Careful with Good Faith Payments
Christopher G. Hill | Construction Law Musings | November 25, 2019 Sometimes doing the expedient thing and what looks good at the time can come back to bite you. Just ask 3M Company. In Faneuil, Inc. v. 3M Co., the Virginia Supreme Court considered a customer services subcontract between Faneuil and 3M relating to a toll… Continue reading Be Careful with Good Faith Payments
The Real Lemon in the Bunch: Understanding Pay-If-Paid Clauses in Construction Contracts
Matthew DeVries | Best Practices Construction Law | November 22, 2019 As you may be aware, one of the greatest risks on a construction project involves the payment process. Just like my kids expect to be paid for the lemonade they sell, contractors and subcontractors expect to be paid on a timely basis once the… Continue reading The Real Lemon in the Bunch: Understanding Pay-If-Paid Clauses in Construction Contracts