News Release
Contact: ASAColorado with questions at (303) 759-8260, fax (303) 759-8286
FOR IMMEDIATE RELEASE

The Colorado Supreme Court ruled in favor of subcontractors recently in its decision in the case of Main Electric v. Printz Services Corporation. The Court restored subcontractors’ right to payment in all situations except for those which are a strict pay-if-paid contract provision. The Court ruled that in order to create a pay-if-paid clause, the subcontract must unequivocally state that the subcontractor will be paid only if the general contractor is first paid by the owner and set forth the fact that the subcontractor bears the risk of the owner’s nonpayment. Otherwise, the payment provision is a pay-when-paid clause.

In this case the Court interpreted the payment provisions of a construction contract to require a general contractor to pay a subcontractor even though the owner has failed to pay the general contractor. The Court held that the "when" of this clause is not a contingency, but rather means that payment must be made in a reasonable time frame. Colorado is now in line with the majority of jurisdictions on the payment issues.

ASA filed an amicus curae brief in this case. ASA’s Chapter Attorney Mark Gruskin of Woodrow of Gruskin P.C. assisted with the appeal. The American Subcontractors Association (ASA) is the advocate for construction specialty contractors and suppliers. ASA members are both union and open shop companies and range in size from the smallest private firms to the nation’s largest specialty contractors. ASA’s Colorado Chapter is celebrating nearly 20 years representing the lifeblood of Colorado’s building industry: subcontractors of all trades who perform over 80 percent of industrial and commercial construction.