Christopher G. Hill | Construction Law Musings Last year, the Virginia General Assembly passed into law a ban on the so-called pay-if-paid clauses, effective January 1, 2023. I shared my thoughts and concerns with the legislation as drafted at the time of its passage. During this most recent legislative session, and among some other construction-related bills, the General Assembly… Continue reading Virginia General Assembly Tweaks Pay-if-Paid Ban
Tag: Pay-if-Paid Clause
Virginia Bans Pay-If-Paid Clauses to Protect Construction Subcontractors
Meghan Hunter Harrison | Troutman Pepper Virginia has joined the ranks of states that ban “pay-if-paid” clauses. Contingent payment clauses, like “pay-if-paid” and “pay-when-paid” clauses, protect contractors: A contractor need not pay its subcontractors or suppliers until the owner pays the contractor. A “pay-if-paid” clause conditions a subcontractor’s right to payment on the owner paying the contractor.… Continue reading Virginia Bans Pay-If-Paid Clauses to Protect Construction Subcontractors
New Jersey Appellate Division Confirms Enforceability of Pay-if-Paid Provisions
Jacob Perskie and Lauren Wright | Fox Rothschild In a case of first impression, the New Jersey Appellate Division has finally formally recognized the enforceability of pay-if-paid clauses in New Jersey, so long as those clauses clearly and unambiguously establish a condition precedent to payment of the subcontractor. JPC Merger Sub LLC v. Tricon Enter., Inc.,… Continue reading New Jersey Appellate Division Confirms Enforceability of Pay-if-Paid Provisions
New Jersey Appellate Court Addresses Whether Pay-if-Paid Clauses Are Enforceable
Matthew L. Erlanger | Construction Law Now Blog 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 from the owner. In other words, unless a general contractor actually receives payment from the owner,… Continue reading New Jersey Appellate Court Addresses Whether Pay-if-Paid Clauses Are Enforceable
New Statutory Payment Regime for Public and Private Works in Virginia
Anthony LaPlaca | Seyfarth Shaw For general contractors working in Virginia, 2023 marks the end of one of the more prolific contractual rights available—the pay-if-paid defense. Until now, pay-if-paid clauses were a valid means of shifting to subcontractors the risk of owner insolvency or wrongful withholding. In the spirit of freedom of contract, Virginia courts… Continue reading New Statutory Payment Regime for Public and Private Works in Virginia