In this linked article distributed
by Advise & Consult, Inc., Smith, Currie & Hancock's Gene Heady discusses default-termination clauses in subcontracts and their impact
on the parties.
In particular, the article provides some ideas as to what should
constitute an "event of default" for the subcontractor, including
failing to pursue its work diligently, failing to prosecute the work in a
workmanlike and skillful manner, failing to pay sub-subcontractors and
suppliers, or failing to correct defective work, among others. One very
important point that may be ignored by some general contractors is the
requirement to follow the contractual provisions allowing subcontractors to
cure their defaults.
The article is a good summary of what types of clauses should be
incorporated into subcontracts to protect both the subcontractor and the
contractor. More saliently for us as a dispute-resolution group, it helps
to remind us of possible defenses to a termination for default claim.
No comments:
Post a Comment