Wednesday, October 27, 2010

The Massachusetts Prompt Pay Law

The new MA Prompt Pay Law goes into effect on November 8, 2010.  It applies to construction projects of >$3,000,000.00 and effectively eliminates the use of "pay when paid" clauses for these projects. The law details the required payment schedules for General Contractors to Subcontractors to their subcontractors and so on.  There is a nice write-up about it at Massachusetts Real Estate blog:

 http://www.massrealestatelawblog.com/massachusetts-construction-prompt-pay-law-passed/

Unfortunately it does not apply to most residential construction, whereas the prompt pay laws in some other states (such as Rhode Island) do apply.