As a subcontractor how can I protect myself if a general contractor goes bankrupt?
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As a subcontractor how can I protect myself if a general contractor goes bankrupt?
Our business has a good amount of money that we are waiting on from a general contractor and we were wondering where we’d stand if they go bankrupt and if we’d get paid. Also, we were wanting to protect ourselves in the future without making the contractor upset since we do a lot of business with them.
Asked on January 3, 2012 under Business Law, Kansas
Answers:
William Price / Growthlaw
Answered 12 years ago | Contributor
File mechanics liens and get your money from the property owners. Stop doing business with bankrupts and deadbeats in general, or at least get cash in advance if you do any further business where they are involved, and be darn sure you're not partners with them, by having separate contracts with all owners, and other documentation (such as mechanics lien filings) showing them as general and you as subcontractor, and showing when clients should pay you if you aren't paid by the GC.
Hope this helps,
Bill Price
William A. Price
Attorney at Law
Hope this helps,
Bill Price
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