Aetna Casualty And Surety Co. v. Aniero Concrete Co.
404 F.3d 566 | Court of Appeals for the Second Circuit | 2005
What This Case Means for Subcontractors
Aniero Concrete challenged a construction contract completion agreement after the School Construction Authority (SCA) refused to consent to assignment of the contract. The court ruled the contract was invalid because a required condition—the SCA's written consent to assignment—was never satisfied. This decision means that even if you've done the work and other contract terms seem favorable, a contract can be completely unenforceable if a critical condition precedent isn't met. For subcontractors, this is a critical reminder that assignment restrictions and consent requirements in prime contracts can kill your payment rights downstream.
Key Takeaways
- •Always verify that any required consents or approvals from the project owner are obtained in writing before relying on a contract—missing this can void the entire agreement
- •If your contract requires assignment consent, get it documented before you start work or assign your rights; don't assume verbal approval or partial performance counts
- •Review your subcontract for any conditions precedent (like owner approval, insurance requirements, or lien waivers) and confirm they're satisfied before you're owed payment
The Completion Agreement was invalid due to an unsatisfied express condition precedent.
Frequently Asked Question
Can I get paid if the prime contractor assigned the work to me without the owner's written consent?
Not necessarily. If the contract requires the owner's written consent to assignment and that consent was never obtained, the entire contract may be invalid—even if you completed the work. Always require proof of written consent before starting work on an assigned contract. Don't rely on verbal approval or assumptions that the owner won't object.
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