Five Mistakes Subcontractors Commonly Make Before Signing Construction Subcontracts

Construction subcontractors assume a tremendous amount of risk with each subcontract that they sign with a prime contractor. While much of that risk cannot be avoided, there are some risks that subcontractors can reduce (if not eliminate) by avoiding the following mistakes prior to signing their subcontracts.

1. They Do Not Receive a Copy of the Prime Contract

Subcontracts often include a provision stating that the subcontractor is bound to the prime contractor on the same terms that the prime contractor is bound to the owner (commonly known as the "Flow-Down"). A subcontractor can only know-and abide by-the prime contract terms if the subcontractor obtains a copy of the prime contract before the subcontract is signed. For that reason, upon request, a prime contractor should promptly provide a copy of the prime contract (which may be redacted to protect confidential information, such as the prime contract price). If the prime contractor declines to provide