Virginia has joined the growing number of states that prohibit “pay-if-paid” clauses. The new law, known as Virginia Senate Bill 550, amends Virginia’s Prompt Payment Act (Va. Code § 2.2-4354) and its relatively new (July 1, 2020) wage theft statute (Va. Code § 11-4.6) and applies to public construction contracts and private construction contracts that
A contractor is halfway through the (timely) completion of a project and the owner’s payment is late. Days, weeks go by, and now the contractor is incurring all the costs of the work without any compensation. It might be tempting to simply walk off the job, but bear in mind that legally speaking, that might
Given the uncertainty that COVID-19 has brought to federal projects, it is imperative now more than ever that contractors preserve rights to potential claims at all turns. Fortunately, with careful reading and documentation, contractors can satisfy the government’s desire for releases while preserving their claims. A recent Armed Services Board of Contract Appeals decision is
When crafting a liquidation or “pass-through” agreement for a subcontractor claim against the government, the key provision from the prime contractor’s perspective is a release from any liability for the subcontractor’s claim with the exception of amounts recovered from the government related to that claim. If the release language is too broad, however, the agreement
Contractors do not have to waive future claim rights when negotiating the direct cost of a change order (modification) with the government, despite banter by the contracting officer that reservation of claims is not permitted. More often than not, the contracting officer will inform the contractor that it is necessary to incorporate the following language
Two recent decisions – one from the U.S. Civilian Board of Contract Appeals and the other from the U.S. Court of Federal Claims – provide opposing holdings on whether the government can raise a “Severin doctrine” defense to subcontractor “pass-through” claims based on broad language in subcontractor progress payment releases. In light of these
Although most contractors go to great lengths to promote jobsite safety, the fatal injury rate in the construction industry – which employs almost 6.5 million people – still exceeds that of any other U.S. industry. The Occupational Safety and Health Act (OSHA) has an entire section of regulations just for contractors. The OSHA regulations help
Commercial general liability (CGL) coverage for a general contractor is not guaranteed, even if property damage is all a subcontractor’s fault. Consider the following example: A general contractor builds a stadium for which a subcontractor builds the frame. After the project is complete, a wall collapses. An independent investigation reveals the subcontractor’s defective framing work