Sub Agreement Meaning

Costs must be borne in accordance with the guidelines and procedures set out by LEAD INSITUTION, provided that these policies and procedures promote the best interests of the project implemented under this agreement. The signed agreement must be recognized by a notary and recorded in the county`s official records in order to be enforceable. To the extent necessary under ars 35-214, the sub-receiver retains all records relating to that sub-contract. For many construction projects, the contractor enters into a contract with a contractor for all the work and the contractor then enters into subcontracts for part of the work. The subcontractor`s agreements often contain a back-to-back clause. The importance of a “back-to-back” clause is that the agreement between the principal contractor and the subcontractor depends on the agreement between the initial customer and the principal contractor and that, as a general rule, the original client is the only one to confirm the work and that the payment and payment of the principal contractor to the subcontractor depend on the receipt of the payment by the principal contractor. The guarantee, to the extent required by the Terms and Conditions, the Framework Agreement and/or the Sub-Agreement or The Project Agreement, is issued by a bank or insurance company in accordance with the agreements between the parties and in accordance with the model approved by V-SH. In a case that was tried in early 2016, an engineering firm acted as a contractor in a project and assigned a subcontractor a “back to back” clause for certain jobs. The Court held that the purpose of a “back-to-back” clause is generally to prevent the subcontractor from paying the subcontractor for work that has not been approved or paid for by the contracting authority for reasons related to the subcontractor, such as. B than partial or inappropriate work.

Despite the existence of a “back to back” clause in the agreement between the parties and even if the supplier has not received payment from the customer, it does not nullify the obligation for the contractor to pay the subcontractor if it is established that the subcontractor did the work properly. In another case, reviewed at the end of April 2016, the client did not pay due to defects in the work. The Court found that, despite the “back-to-back” clause, the principal contractor is required to pay the subcontractor, since the principal contractor was not present. In many cases, cooperation between contractors and subcontractors is done without agreement or agreement without legal consultation (particularly by the subcontractor). Given the complexity of the relationship, where there is another factor (the client) in the image, it is even more important than usual to call a lawyer who has specialized in this area from the pre-contract phase, but certainly because there is a late payment. A subordination agreement is a legal document that classifies one debt as less than another, which is a priority in recovering repayment from a debtor. Debt priority can become extremely important when a debtor becomes insolvent or declares bankruptcy. Mortgagor pays him for the most part and gets a new credit when a first mortgage is refinanced, so that the new last loan now comes in second.