"General contractor bankruptcy filings are increasing dramatically and can have a significant impact on both industrial owners and subcontractors," said Walczyk. "Owners and subs need to take steps before and during GC bankruptcy filings to protect themselves now more than ever before."
General contractors who file for bankruptcy in the middle of a project leave both the owners and subcontractors in limbo, Walczyk continued. "In this economic climate, the best strategy for industrial project owners is to make certain their contracts require that GCs pay their subcontractors and suppliers prior to receiving any progress payments or retainer fees," he said. "Meanwhile, subcontractors should be equally vigilant about protecting their lien rights and should try to get joint check arrangements to assure payment."
CRT is the New Jersey chapter of the Construction Users Roundtable, a national not-for-profit organization that strives to produce meaningful changes within the construction industry--promoting overall cost effectiveness; and improving the way construction is planned, managed and executed. The chapter held its monthly meeting at the Metuchen Golf & Country Club here.
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