For State projects in Connecticut, do Material Suppliers need to send a preliminary to the Hiring Party (General Contractor)?

4 months ago

Hello,

We currently are a Material Supplier sending Solar Panels to a State/County project in the State of Connecticut, and we are being hired by a General Contractor. Do we need to send a preliminary notice to the General Contractor?

I see on the Preliminary Notice section that it states “Suppliers Must Send Notice If Unpaid” and gives a 30 day time limit. I was hoping you can clarify what it means “Parties who remain unpaid 30 days after their hiring party is paid for the work the claimant provided must provide notice to the hiring party in order to gain protections.” I’m just looking for clarification. Do you know how we confirm that the hiring party has been paid? From what I understand, once the General Contractor is paid, we only have 30 days from that date of payment to send a preliminary notice. Is that correct?

Thank you!

Thank you.

Senior Legal Associate Levelset

Connecticut has interesting (and relatively unclear) notice requirements for public projects. First: if a contractor receives payment but fails to pay their subs and suppliers within 30 days, the unpaid sub/supplier must provide notice to their contractor before making a bond claim. Once that notice is received, the contractor must make payment within 10 days, or else they’ll face 1% interest, per month, on late payments.

Note, though, that this notice must be sent 30 days after the contractor has received payment. So, that 30 days isn’t a deadline so much as it is a start date – once that 30 days is up, the notice may be sent. And, if payment doesn’t come within 10 days fo the contractor’s receipt of the notice, interest begins to accrue.

As you mentioned above, though, it’s hard for a sub or supplier to know exactly when a contractor has received payment. However, by sending a notice any time payments have fallen behind schedule, a sub or supplier can fulfill the notice requirement. Or, by setting up a schedule for sending these notices on a regular basis (when payment hasn’t been made), a sub or supplier may be able to cover their bases even if they don’t know when their contractor is being paid. Sending notice early may not be effective, but there isn’t really a penalty for it either. After all – the late payment interest penalties will only kick in if payment is actually late. So, the risk of sending notice a bit early shouldn’t be all that daunting. And, if a customer explains that the notice has been prematurely sent, it might be easier to get an idea of when payment from the public entity to that customer might be expected.

I hope this was helpful!

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