Paid when paid/ Paid if paid/ Flow through contract clauses

They are the lifeblood of general contractors and despised by subcontractors. Flow through agreements provide for payment of a subcontractor when or if a general contractor is paid. Contractors will tell you they need flow through clauses in their contracts, for among other reasons, to insure that their subs do work which satisfies the owner. Subs will tell you that flow through clauses provide contractors with excuses not to pay them when a job is underbid or is improperly managed by the general contractor.

However, flow through clauses are often interpreted only as a timing mechanism for requiring payment and often cannot be used as a method to completely deny payment to a sub if proper work is performed. The language of the flow through clause and the state where the work is performed are very significant when determining if a flow through clause is enforceable.

When drafting, negotiating or deciding whether to sign a general/ subcontractor agreement, it is important that a contractor seek the assistance of counsel in order to determine the effect of the ever present flow through clause.

No Comments

Leave a comment
Comment Information
  • Lead Counsel
  • MSBA
  • sl-badge
Email Us For A Response

How Can We Help You

Bold labels are required.

Contact Information

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.


Privacy Policy

Frederick Office
170 West Patrick Street
Frederick, Maryland 21701

Phone: 301-732-7675
Phone: 301-668-5111
Fax: 301-668-2770
Frederick Law Office Map

Silver Spring Office
12114B Heritage Park Circle
Silver Spring, Maryland 20906

Phone: 301-732-7675
Phone: 240-833-2284
Fax: 301-942-8296
Silver Spring Law Office Map

Upper Marlboro Office
14452 Old Mill Road
Suite #301
Upper Marlboro, Maryland 20772

Phone: 301-732-7675
Phone: 301-736-5432
Upper Marlboro Law Office Map