Does A201 include a 'pay when paid' provision, and how does it affect payments?

• A. Always includes pay-when-paid; payments depend on owner's cash flow.
• B. Progress payments are certified by the Architect; there is no pay-when-paid clause; payments depend on certification.
• C. Payments are fixed and not subject to certification.
• D. The Architect pays subcontractors directly from owner's funds.

Answer: (B)

The important concept here is how payment is determined under the AIA A201 contract. In this standard form, there is no pay-when-paid clause. Instead, progress payments are based on the value of work the Contractor has completed as certified by the Architect. The Architect reviews the Contractor’s payment applications, verifies the work, and issues a certificate for payment stating how much the Owner owes for that period. The Owner then pays that certified amount according to the contract’s timing, subject to any withholdings for items like incomplete work, errors, or changes. Retention is often held back and released later as the project progresses.

This setup keeps payment tied to the Architect’s certification of progress rather than the Owner’s cash flow or other factors. The other options would imply payment is automatically dependent on the Owner’s funds or outside certifications, which isn’t how A201 is structured.