“Pay if paid” clauses upheld by First District
By Jim Dash
Construction Law,
January 2017
In the first published Illinois decision on the topic in 30+ years, the court in Beal Bank Nevada v. Northshore Center THC, LLC,held on September 30, 2016 that “pay if paid” clauses remain enforceable in contract if the payment condition is an unambiguous condition precedent to payment.
Pay If/When Paid clauses in Illinois
By Jim Dash
Construction Law,
July 2015
As a matter of pure contract, “Pay When Paid” or “Pay if Paid” clauses generally are enforceable in Illinois so long as the contract makes payment to the upstream party an unambiguous condition precedent to payment downstream. And if (sub)contractor does not have, or believes that it does not have, the leverage to negotiate the terms of its contract, it often will accept the contract, “Pay When/If Paid” clause and all, just in order to get the work.
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