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The Real Lemon in the Bunch: Understanding Pay-If-Paid Clauses in Construction Contracts

Best Practices Construction Law

The subcontract between the general contractor and the concrete subcontractor contained the following clause: “The obligation of contractor to make payment under this agreement, whether a progress or final payment, or for extra or change orders or delays to the work, is subject to the express condition precedent of payment from the owner. ”.

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The Real Lemon in the Bunch: Understanding Pay-If-Paid Clauses

Best Practices Construction Law

The subcontract between the general contractor and the concrete subcontractor contained the following clause: “The obligation of contractor to make payment under this agreement, whether a progress or final payment, or for extra or change orders or delays to the work, is subject to the express condition precedent of payment from the owner.”.

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Construction Arbitration

Constructlaw

Practitioners arbitrating construction disputes rely heavily on these concepts to present claims and defenses. For more on change orders, see Changes in the Work in Construction Contracts: Drafting Strategies on Practical Law.) The replacement of malfunctioning equipment.