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"Pay-if-paid" Clause Protected Prime But Not Surety Condition Precedent; Bonds-payment

Saturday, January 03, 2004 11:49 am

 
"Pay-if-paid" Clause Protected Prime But Not Surety Condition Precedent; Bonds-payment

A Florida court has ruled that a "pay-if-paid" clause in a subcontract protected the prime contractor but not the prime's payment surety on a public works project.

Padula & Wadsworth Construction, Inc. (P&W) was the prime contractor on a middle school project in Dade County. P&W furnished payment and performance bonds issued by Travelers Insurance Co.

P&W subcontracted the painting work to Everett Painting Co., Inc. The subcontract stated that final payment by the project owner to P&W was a condition precedent to the prime contractor's obligation to make final payment to Everett.

When P&W [...]

 
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