FEDERALDistrict Court, D. Connecticut
2006

STEWARD MACH. CO., INC. v. White Oak Corp.

462 F. Supp. 2d 251District Court, D. Connecticut • Decided 2006Enforced

HOLDING

Steward Machine Company supplied machinery to White Oak Corp. for a Connecticut bridge project but wasn't paid in full and had to store the equipment for years. The court ruled that White Oak must pay Steward for both the machinery and storage costs. The key finding: White Oak's payment obligation to Steward was not dependent on whether the state (ConnDOT) paid White Oak first. This protects subcontractors from being caught in payment chain delays.

KEY FINDINGS

Retention

Your right to payment from the general contractor does not depend on the GC receiving payment from the project owner—get this in writing in your contract

Change Order

You can recover storage and holding costs if a GC fails to accept delivery or pay on time—document all storage expenses carefully

Dispute Resolution

A written purchase order contract is strong evidence of payment obligations and will be enforced even if the GC claims it's waiting for owner payment

FULL COURT OPINION