Pay-if-paid clauses in construction contracts are controversial at best. While some states have enacted legislation strictly prohibiting the enforceability of such clauses, other states will still enforce them if the...
Earlier this year, legislation was introduced in Virginia to shore up payment protections in the construction industry. The proposed changes include an official prohibition on pay-if-paid clauses, along with new...
The Virginia 2022 Legislative Session recently adjourned, and any proposed legislation that made it out of the State Legislature has been passed on to the Governor’s office for approval. One...
Although relatively common, pay-if-paid clauses are a significant point of contention in the construction industry. A subcontractor accepting the risk of the owner’s nonpayment is, well…risky. Due to the significant...
Pay-if-paid clauses can cause some serious problems when it comes time for subcontractors to get paid. So much so, that many states have prohibited their use as against public policy....
In a construction contract, a “pay-when-paid” clause acts as a timing mechanism that obligates a hiring party to pay their subs or suppliers when they are paid, or within a...
Alabama pay if paid clauses are strong - the state has upheld them for all project types. Sureties can use these clauses to fend off bond claims, too.
New York pay when paid clauses, like many other states, will only serve as a timing mechanism. Still, payment can't be unreasonably delayed.
A recent Louisiana case helps make it clear - Louisiana bond claims won't be stopped by pay if paid provisions, regardless of whether the project is public or private.
A recent case from the Kentucky Supreme Court shows that the Bluegrass State will uphold pay if paid clauses when they appear unambiguously in the contract.