Thank you for sharing!

Your article was successfully shared with the contacts you provided.

On June 16, Texas Gov. Rick Perry signed into law S.B. 324, which addresses contingent payment clauses in construction contracts, often called pay-if-paid clauses. Lawyers practicing construction law, particularly those representing general contractors and subcontractors, need to know about the changes this bill makes in how their clients can structure their business dealings. The bill goes into effect Sept. 1.

Contingent payment clauses are payment provisions in construction contracts that allocate risks of nonpayment among general contractors and subcontractors. Typically, the general or primary contractor will include a provision in its subcontract agreement that makes its obligation to pay the subcontractor conditional upon its receipt of payment from the owner. With such a clause in a subcontract, the intent is that the general or primary contractor does not have to pay the subcontractor until and unless the contractor receives payment from the owner.

This content has been archived. It is available through our partners, LexisNexis® and Bloomberg Law.

To view this content, please continue to their sites.

Not a Lexis Advance® Subscriber?
Subscribe Now

Not a Bloomberg Law Subscriber?
Subscribe Now

Why am I seeing this?

LexisNexis® and Bloomberg Law are third party online distributors of the broad collection of current and archived versions of ALM's legal news publications. LexisNexis® and Bloomberg Law customers are able to access and use ALM's content, including content from the National Law Journal, The American Lawyer, Legaltech News, The New York Law Journal, and Corporate Counsel, as well as other sources of legal information.

For questions call 1-877-256-2472 or contact us at [email protected]


ALM Legal Publication Newsletters

Sign Up Today and Never Miss Another Story.

As part of your digital membership, you can sign up for an unlimited number of a wide range of complimentary newsletters. Visit your My Account page to make your selections. Get the timely legal news and critical analysis you cannot afford to miss. Tailored just for you. In your inbox. Every day.

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.