Construction contracts contain many risk-shifting mechanisms. One such mechanism is the “pay when paid” provision that requires payment from one party before there is any requirement to pay another party. Typically, this contract provision is found in the contract between the general contractor and its subcontractors, as well as in the subcontractor’s contract with its subcontractors. If not properly worded, this risk shifting provision will not have its intended consequences.
Construction Industry Legal Blog
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