The award call is the best moment in the pursuit — and the most dangerous document of the job arrives right after it. The subcontract the GC sends is not your bid with a signature line. It’s a risk-transfer instrument drafted by the GC’s lawyers, and the gap between what you bid and what you’re about to sign is where jobs go bad before mobilization.

The short version

  • Compare contract value and scope against your bid line by line — and confirm your scope letter is attached as an exhibit, not silently dropped.
  • Flow-down clauses bind you to a prime contract you’ve probably never read. Get it and read the parts that flow down.
  • In California, pay-if-paid clauses are unenforceable — but pay-when-paid timing, notice windows, and no-damages-for-delay language still do real damage.
  • Notice provisions are the teeth of the contract. Diary the windows (often 5–10 days) before you sign, not after the first dispute.
  • An LOI is authorization to start, not a contract — know what it covers, what it pays if the deal dies, and don’t let the full subcontract linger unsigned for months.

First: reconcile the deal against your bid

Before reading a single clause, check the arithmetic of the deal itself:

  • Contract value vs. bid value. If the number moved in buyout negotiations, confirm the scope moved with it — a $40K “cleanup” of your number with no scope change is just margin you gave away.
  • The exhibits list. Your proposal and its exclusions only protect you if they’re incorporated. If the subcontract’s exhibit list includes the plans, the specs, and the GC’s scope sheet but not your scope letter, your exclusions just evaporated. Ask for it to be attached — this is a routine request, and the answer tells you a lot.
  • The scope exhibit’s language. GC scope sheets love “work reasonably inferable” and “complete systems” phrasing. Where their sheet conflicts with your letter, resolve it in writing now, while you still have leverage — you never have more than the day before you sign.
  • Schedule exhibit. Does it match the durations and mobilization count you priced?

Flow-down: you’re agreeing to a document you haven’t seen

Nearly every subcontract binds you to the prime contract between the GC and owner “as if set forth in full.” That one sentence imports the owner’s dispute procedures, payment conditions, liquidated damages, and termination rights into your deal. You’re entitled to see what you’re bound by — request the prime contract (redacted pricing is fine) and actually read the flowed-down sections: payment, changes, claims, schedule, and termination.

The clauses that hurt specialty subs

  • Payment conditions. California courts have held true pay-if-paid clauses — making owner payment a strict precondition of your right to be paid — unenforceable; the GC can’t offload owner-insolvency risk onto you that way. But pay-when-paid timing survives in reasonable form, and California’s prompt-payment statutes put penalty-backed deadlines on passing your money through. Know the difference; strike or negotiate the boldest versions.
  • Notice windows. The quietly lethal ones: claims for extras or delay waived unless written notice within 5, 7, or 10 days. Courts enforce these. Whatever the number is, it becomes a standing instruction to your PM and foremen from day one — put it in the job kickoff, not the filing cabinet.
  • No-damages-for-delay. You get time, never money, for delays — even ones the GC caused. Negotiate carve-outs (active interference, unreasonable duration), or price the risk.
  • Indemnity and insurance. California restricts the broadest forms of construction indemnity, but the enforceable middle is still wide. Check the additional-insured requirements against your actual policy before signing — a requirement your carrier won’t endorse is a default you signed up for.
  • Retention. The percentage, and — just as important — when it releases: at your completion, or at project completion a year after your last day on site?
  • Termination for convenience. If they can end the deal at will, what do you recover — cost plus reasonable overhead, or cost only?

LOIs and NTPs: starting work before the contract exists

GCs routinely issue a letter of intent to get you mobilized while the subcontract is “in legal.” An LOI is usually authorization with a cap, not the deal — so read it for three things: the dollar cap on authorized work, what you’re paid if no subcontract ever materializes, and whether it binds you to the not-yet-negotiated subcontract terms (some try). Working under an LOI for months while the subcontract sits unsigned is common and corrosive — every week of work you complete reduces your leverage to negotiate the document. Set yourself a rule: past a fixed percentage of the LOI cap or a fixed number of weeks, the subcontract gets resolved before the crew grows.

Make review a checklist, not a vibe

None of this requires a lawyer on every job — it requires the same ten checks on every contract, done before signature while changes cost nothing: value vs. bid, scope exhibit vs. scope letter, exhibits complete, prime contract obtained, payment terms, notice windows diaried, delay clause, indemnity vs. policy, retention release, termination terms. The subs who get hurt aren’t the ones who signed tough contracts — everyone signs tough contracts. They’re the ones who found out what they signed during the first dispute.