Walton Technology, a subcontractor, rented equipment to the prime contractor Weststar on a federal construction project but wasn't paid. The contract had a 'pay when and if paid' clause, which Weststar argued meant Walton couldn't sue until the government paid Weststar. The Ninth Circuit ruled that this clause doesn't eliminate a subcontractor's rights under the Miller Act payment bond. Subcontractors can sue the surety for payment even if the prime contractor hasn't been paid by the government.
A 'pay when and if paid' clause in your subcontract does not waive your Miller Act rights—you can still sue the payment bond surety directly
You do not have to wait for the government to pay the prime contractor before filing a Miller Act claim against the surety
Document all work, equipment rental, and delivery carefully to support your Miller Act claim if payment is withheld