It is customary for general contractors to include pay when paid clauses in their contracts, attempting to limit any requirement on their part to pay their subcontractors until they’ve received payment from the project’s owner.

Given the vagaries and uncertainties these days in loan commitments as well as material prices, not to mention the overall state of the construction industry, one can quickly understand why pay-when-paid provisions have become so critical in construction contract negotiations.

Shifting the risk of an owner’s possible nonpayment from one party to another is neither simple nor guaranteed.

Good contracting practices, The contract documents, work defined, …

Subcontract price, payment, time, extensions of time, …

Change Orders, Notices and Claims, Bonds and Insurance, Indemnification…