{"id":900658,"date":"2022-12-07T13:38:21","date_gmt":"2022-12-07T20:38:21","guid":{"rendered":"https:\/\/www.myconstructionexpert.com\/blog\/?p=900658"},"modified":"2022-12-07T13:38:27","modified_gmt":"2022-12-07T20:38:27","slug":"pay-if-paid-ban-effective-jan-2023","status":"publish","type":"post","link":"https:\/\/www.myconstructionexpert.com\/blog\/pay-if-paid-ban-effective-jan-2023\/","title":{"rendered":"PSA: Pay If Paid Ban Goes into Effect on January 1, 2023"},"content":{"rendered":"\n<p>Christopher G. Hill | <a href=\"https:\/\/constructionlawva.com\/psa-pay-if-paid-ban-goes-into-effect-on-january-1-2023\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">Construction Law Musings<\/a><\/p>\n\n\n\n<p>I have\u00a0<a href=\"https:\/\/www.myconstructionexpert.com\/blog\/pay-if-paid-legislation-virginia-2\/\" target=\"_blank\" rel=\"noreferrer noopener\">written a couple of times<\/a>\u00a0here at\u00a0Musings\u00a0regarding the new <a href=\"https:\/\/www.myconstructionexpert.com\/blog\/pay-if-paid-legislation-virginia-3\/\" target=\"_blank\" rel=\"noreferrer noopener\">pay-if-paid legislation<\/a> passed by the General Assembly last session.\u00a0 While the statute has some inconsistencies and a working group has made\u00a0some recommendations, the legislation as passed will go into effect on January 1, 2023, without any changes (at least until next session).\u00a0 As always, such action by our legislature here in Virginia will create work for\u00a0construction attorneys\u00a0assisting their clients to amend contracts to meet the new rules.<\/p>\n\n\n\n<p>Essentially (and with minor inconsistencies between public and private contracts), the bill requires that any construction contract entered into after January 1, 2023 have the following provisions:<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>On public projects:&nbsp; A payment clause that obligates a contractor on a construction contract to be liable for the entire amount owed to any subcontractor with which it contracts. Such contractor shall not be liable for amounts otherwise reducible due to the subcontractor\u2019s noncompliance with the terms of the contract. However, in the event that the contractor withholds all or a part of the amount promised to the subcontractor under the contract, the contractor shall notify the subcontractor, in writing, of his intention to withhold all or a part of the subcontractor\u2019s payment with the reason for nonpayment.<\/li><li>On private projects: Requiring the Contractor or subcontractor to pay its subcontractors or sub-subcontractors within the earlier of (i) 60 days of the satisfactory completion of the portion of the work for which the subcontractor has invoiced or (ii) seven days after receipt of amounts paid by the owner to the general contractor or by the higher-tier contractor to the lower-tier contractor for work performed by a subcontractor pursuant to the terms of the contract. In the event that a contractor withholds all or a part of the amount invoiced by any lower-tier subcontractor under the contract, the contractor shall notify the subcontractor, in writing, of his intention to withhold all or a part of the subcontractor\u2019s payment with the reason for nonpayment, specifically identifying the contractual noncompliance, the dollar amount being withheld, and the lower-tier subcontractor responsible for the contractual noncompliance.<\/li><\/ul>\n\n\n\n<p>The changes go on to provide for interest provisions for non-compliance and to specifically void any condition precedent pay-if-paid language that may remain in any construction contracts. For more on the specifics, check out\u00a0<a href=\"https:\/\/constructionlawva.com\/final-thoughts-on-new-pay-if-paid-legislation-in-va\/\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">my earlier post on this subject<\/a>.\u00a0 For the full text of the legislation as passed in SB550,\u00a0<a href=\"https:\/\/lis.virginia.gov\/cgi-bin\/legp604.exe?221+ful+SB550ER2\" target=\"_blank\" rel=\"noreferrer noopener nofollow\">click here<\/a>.<\/p>\n\n\n\n<hr class=\"wp-block-separator\"\/>\n\n\n\n<p><strong>When one of your cases is in need of a construction expert, estimates, insurance appraisal or umpire services in defect or insurance disputes &#8211; please call Advise &amp; Consult, Inc. at 888.684.8305, or email <a href=\"mailto:experts@adviseandconsult.net\" target=\"_blank\" rel=\"noreferrer noopener\">experts@adviseandconsult.net<\/a>.<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>Christopher G. Hill | Construction Law Musings I have\u00a0written a couple of times\u00a0here at\u00a0Musings\u00a0regarding the new pay-if-paid legislation passed by the General Assembly last session.\u00a0 While the statute has some inconsistencies and a working group has made\u00a0some recommendations, the legislation as passed will go into effect on January 1, 2023, without any changes (at least&hellip; <a class=\"more-link\" href=\"https:\/\/www.myconstructionexpert.com\/blog\/pay-if-paid-ban-effective-jan-2023\/\">Continue reading <span class=\"screen-reader-text\">PSA: Pay If Paid Ban Goes into Effect on January 1, 2023<\/span><\/a><\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"_jetpack_newsletter_access":"","_jetpack_dont_email_post_to_subs":false,"_jetpack_newsletter_tier_id":0,"_jetpack_memberships_contains_paywalled_content":false,"_jetpack_memberships_contains_paid_content":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","enabled":false},"version":2}},"categories":[9],"tags":[9895,224,7568,357],"class_list":["post-900658","post","type-post","status-publish","format-standard","hentry","category-construction-contracts","tag-advise-consult","tag-construction-contract","tag-pay-if-paid-clause","tag-virginia","entry"],"jetpack_publicize_connections":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v25.0 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>PSA: Pay If Paid Ban Goes into Effect on January 1, 2023 - Advise &amp; 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