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OWNER DOES NOT PAY GC. IS GC RESPONSIBLE TO PAY SUBS. NYS LAW..

Rockville Centre, NY |

I AM A GENERAL CONTRACTOR. THE OWNER NOT PAID ME FINAL PAYMENTS. THE SUBS HAVE NOT BEEN PAID. AM I RESPONSIBLE TO PAY THE SUBS.

Attorney Answers 4


  1. If you hired the subs why wouldn't you be responsbile to pay them? Put a mechanics lien on the home and/or sue to collect.

    I am a former federal and State prosecutor and now handle criminal defense and personal injury/civil rights cases. Feel free to check out my web site and contact me at (212) 577-9797 or via email at Eric@RothsteinLawNY.com. I was named to the Super Lawyers list as one of the top attorneys in New York for 2012. No more than 5 percent of the lawyers in the state are selected by Super Lawyers. The above answer is for informational purposes only and not meant as legal advice.


  2. Even though the owner has not paid you, that does not forgive your obligation to the subcontractors unless you have a "pay when paid" or "pay if paid" clause within your contract. If your contract with the subs has one of these clauses it may buy you some time, but depending on the language, it may not forgive you completely from paying them.

    Nevertheless, without this clause you're 100% on the hook to pay the subs, regardless of whether you are paid from the owner.

    But, as the previous answer suggests, you are entitled to get paid from the owner. If they haven't paid you, move forward with the filing of a mechanics lien. http://www.zlien.com can help you with this for a low flat fee.

    My Mechanics Lien Filing Service at www.zlien.com. Our number is 866-720-5436. Avvo's terms and conditions apply, answers on Avvo are general responses to hypothetical scenarios presented by questioner.


  3. Scott's answer is correct with one caveat - "pay if paid" clauses are void in New York so even if your contract has this, you still have to pay the subcontractors because the clause is not enforceable. If the clause is worded in such a way as to may it a "pay when paid" clause, you may be able to delay payment but not avoid it. Pay when paid is simply a timing mechanism but does not relieve the obligation to pay. New York Courts will generally treat a pay when paid as allowing a commercially reasonable time for payment even if the owner does not pay.

    One option you may want to pursue is a liquidating agreement. This allows you to pursue the claim against the owner and encompass the subcontracts claims in your claim. The benefit to you is the subs will agree not to pursue you directly while you pursue the owner and the benefit to the subs is they do not incur attorneys fees while you pursue the owner to get them paid. In the right situation a liquidating agreement can be a win win for you and the sub.

    The information provided herein is for informational purposes only and does not constitute legal advice. No attorney-client relationship is created by this answer. You should consult with a local attorney regarding your specific situation to obtain legal advice.


  4. Was this a public or private project? There may be a payment bond you can look to for recovery, but the notice of claim provisions are unforgiving and must be complied with. Check with a local construction attorney for further advise on your rights against the Owner. As far as the subs, unless you have deduct change orders or other defenses to payment, NY law generally requires that you pay your subs regardless of whether the Owner has paid you.

    In accordance with the Avvo community guidelines, this communication does not constitute "legal advice", nor does it form an attorney-client relationship