BEC Closes in Las Vegas with More Advice for Glaziers

Richard Kalson and David White of Thorp Reed & Armstrong LLP talked about a "new hot clause" showing up in subcontracts during their presentation on "Construction Law Developments in 2007" during the Glass Association of North America's (GANA) Building Envelope Contractors (BEC) conference, which closed yesterday at the Rio in Las Vegas. The pay-when-paid clause has a big difference from the pay-if-paid clause, the law duo noted during their talk.

White explained that a pay-if-paid clause more or less says that a subcontractor will only be paid if a general contractor is paid by the owner, implying that if the general contractor is not paid the sub suffers that fate as well. "Don't agree to this," White insisted.

"It's important because once that risk of payment shifts from the general contractor being paid by the owner to you, the subcontractor, then you are completely at the mercy of the payment by owner and you don't ever want to get into that situation," he said. "That should always be a deal breaker."

As White noted, "Some states have actually enacted legislation that these clauses are unenforceable." (CLICK HERE to read about a recent court decision in Georgia on the pay-when-paid clause.)

While the "pay-if-paid clause can result in your never ever ever being paid by the general," White explained, the pay-when-paid clause "sets a reasonable amount of time, say a year," after which point the court will usually make a decision that the subcontractor must be paid.

In response to a question from the audience, White agreed that there can be an advantage to striking a pay-when-paid contract clause so that it simply says the general contractor shall pay the subcontractor.

"To the extent that you can get rid of that, try that, absolutely," White agreed.

The law discussion spanned two days, but it wasn't the sole discussion during yesterday's conference. The audience also heard a talk on energy modeling from Patrick Muessig of Azon USA. Muessig introduced his audience to some of the tools available for this topic, from the National Fenestration Rating Council's (NFRC) Computer Modeling Approach (CMA) and AAMA 507 (CLICK HERE for related story), as well as an overview of some of the federal legislation pointing toward requirements for energy-efficient buildings, including the recently passed Energy Independence and Security Act of 2007 (for more information on this new law, look for the March 2008 issue of USGlass).

Bruce Werner of Curtain Wall Design and Consulting Inc. and Peter Poirier of Tremco Inc. formed a panel about four-sided structural silicone glazing. As Werner pointed out, the talk in Las Vegas was apropos as the City Center project on the Strip is the largest structural silicone glazed (SSG) construction project in the world. Since the first SSG building was constructed in 1971, it has become "a mature technology," Werner said.

CLICK HERE to read about yesterday's keynote speaker Mike Eruzione.

For more about these seminars, look for the April 2008 USGlass magazine.

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