b'BUSINESS TIPNegotiate and draft pass through clauses you can live withBy Daniel Dorfman, Chair, Construction Law Group, Fox, Swibel, Levin & Carroll, LLPOwners, contractors, subcontrac- contract, thereby binding subcon-tors and lower-tier contractors musttractors to the same duties and obli-have a sound understanding of thegationsand to the same extentoperational details and triggers ofasthegeneralcontractorhasto pass-throughprovisionsastheirtheowner.Pass-throughclauses terms can signifi cantly impact themayusegeneralsubstantiallyas obligations and risks of performingfollows or substantially the same for lower-tier contractors.as language, but, importantly they are not uniformly worded and can What is a pass-through clause? have the effect of imposing obliga-Pass-through clauses (a.k.a. fl ow- tions never negotiated or contem-down or conduit clauses), typicallyplated by the lower-tier contractor. incorporate by reference the termsHowever,whendraftedandused of a prime contract between ownercorrectly pass-through clauses can and general contractor into a sub- provide protections to all parties by unambiguously fl owing down specifi c upstream obligations of general contractors to the subcontractors who are actu-allyperformingthemajority of the work. How are pass-through claus-es implemented? It is in the owners interest tobindthesubcontractorto thesameobligationsasthe 32 TileLetter | December 2019'