Make Sure You Abide by Conditions Precedent to Payment

Hopefully, if you are a contractor you have a paragraph in your contract that requires the subcontractor receiving payment to provide you with applicable waiver(s) and release(s) as a condition precedent to payment. You want a waiver and release of lien rights / payment bond rights in consideration of the payment of progress payments and the final payment.  If a subcontractor does not provide you a contractually required release and sues your payment bond surety, you want to argue on behalf of your surety that the subcontractor is NOT entitled to payment until it provides you with the release–a condition precedent to payment.  This argument is supported by Team Land Development, Inc. v. Anzac Contractors, Inc., 811 So.2d 698 (Fla. DCA 2002).  In this case, the court held that the subcontractor’s failure to abide by a contractual condition precent in providing the general contractor a release in satisfactory form excused the general contractor (and, thus, the surety) from making payment until that condition precedent was performed (until the subcontractor furnished the release).

Please contact David Adelstein at dadelstein@gmail.com or (954) 361-4720 if you have questions or would like more information regarding this article. You can follow David Adelstein on Twitter @DavidAdelstein1.

 

 

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