Understanding the Contractor’s Consent: The Hidden Dangers in a Common Form
At the start of a commercial construction project, lenders frequently request the "Contractor's Consent to Assignment" or "Contractor's Consent" forms from contractors. These contracts allow the bank to assume ownership of the project in the event that the owner defaults on the loan, allowing the bank to compel the contractor to finish the project. In this article for Construction Executive, Kenneth E. Rubinstein and Nathan Fennessy outline some of the clauses that contractor's should look out for including limitations on change orders and termination rights, waivers of mechanic's lien rights, waiver of unpaid amounts, and ability to sell and assign.
Read the full article here.