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CFM Review: A One-Page Construction Contract?


Every Friday, we select a few articles from the week that we think are worth your time as a construction financial manager (CFM). We look for compelling articles not only about financial topics, but about business, technology, and life, that challenges you to think about your role as a CFM in different ways. We’d love […]

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Ultimate Guide To Being A Successful Credit Manager

Credit Manager Success Guide

Every day, credit professionals are challenged to handle sensitive financial situations for businesses. They are trusted to analyze complex situations and to make an educated judgment about how to financially interact with other companies. This is a big job.  It can make drastic impacts on a company; that is, drastically good, or drastically bad. If you are […]

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Pay-When-Paid and Pay-If-Paid Clauses (In a Nutshell)

Financial Risk and Priority Battles in Construction Industry

Have you ever come across the words “Pay-When-Paid” or “Pay-If-Paid” in your construction contracts? These provisions are ultimately about determining who will bear the financial risk of a construction project. In other words, if the property owner doesn’t pay, who’s out of luck? America’s public policy generally favors those lower on the chain when it comes to […]

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Pay If Paid: Shifting the Financial Burden “Down the Chain”

Payment Problems and Contract Clauses in Construction Industry

Pay when paid, and pay if paid clauses are pretty common, but can be misunderstood – both in operation and purpose. Below, I’ll attempt to provide some answers and clarifications to common questions and misconceptions about these contract provisions. First, however, before pay when paid and pay if paid clauses are discussed specifically, the background of […]

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CFMA Says Owners Are Shifting Financial Risks Down The Contracting Chain

Protecting working Capital in New Economy and the Construction Financial Management Association (CFMA) recently published some articles suggesting that “cash-strapped public and private owners are shifting greater risk onto contractors through onerous deal terms” [Owners Shift More Financial Risk as Recovery Remains Sluggish]. This is true, but it’s not necessarily new.  As this article will explain, this risk shifting tug […]

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Do Your Mechanics Lien Rights Make Pay When Paid Clauses Irrelevant?

Maximize leverage with lien and security rights

In 1791, Thomas Jefferson introduced the first mechanics lien law legislation and invented a public policy interest in the United States to always protect contractors, suppliers, and subcontractors from the risk of non-payment. As we’ve explored in previous posts, the ensuing 220 years brought epic battles between legislatures, courts, and parties about who should get […]

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Pay When Paid and Pay If Paid: Delaware

Mechanics Lien Claims Open The Purse

Sometimes, it seems as if determining whether pay if paid clauses and/or pay when paid clauses are enforceable in a certain state is nearly impossible. In many states, the question is only resolved by an analysis of the specific language of the individual clause itself, a labor intensive proceeding that, almost invariably, leads to confusion […]

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