what a pay-if-paid clause means for a subcontractor.

within 10 days after Contractor receives payment from Owner

On its own this line reads like a schedule: payment 10 days after something. What decides everything is what the something is.

If the trigger is a date or a milestone, the clause only times payment. If the trigger is someone else getting paid, the clause decides whether payment ever comes due.

receipt of payment from Owner is a condition precedent

These are the load-bearing words. A condition precedent is something that must happen before the duty to pay arises. Not a deadline that can be missed and sued over — the duty itself depends on it.

This is the line that separates the 2 readings. A clause carrying it (or an equivalent such as only if Contractor is paid) is treated as shifting the risk of owner nonpayment from the general contractor to the subcontractor.

Courts look at substance rather than the heading. A clause labeled pay-when-paid was held void where its wording made owner payment a condition precedent, while a provision that merely fixes a time for payment does not indefinitely suspend the subcontractor's right to payment. West-Fair Electric Contractors v. Aetna Cas. & Sur. Co., 87 N.Y.2d 148 — law.cornell.edu/nyctap, read October 18, 2026.

shall have no obligation ... for any portion of the Work for which Owner has not paid

The sentence restates the risk shift, and adds a scale to it: the promise applies portion by portion. An owner payment covering half the subcontractor's work pays the subcontractor half. The other half is not late — under this wording it is not owed.

Without the portion language, a partial owner payment is an argument about how the clause should be read. With it, the arithmetic is written in.

what sits behind the clause: the lien

The clause governs the contract between general contractor and subcontractor. It does not reach the subcontractor's statutory remedies for unpaid work.

In some states that gap is written into the statute: a contingent payment contract "is not a defense to a claim to enforce a preconstruction or construction lien." Utah Code § 13-8-4(3)(a) — le.utah.gov, read October 18, 2026. Missouri's version says such a provision "is no defense to a claim to enforce a mechanic's lien." Mo. Rev. Stat. § 431.183 — revisor.mo.gov, read October 18, 2026.

On public work there is usually no owner to lien at all; the statutory replacement is a payment bond the prime contractor must furnish. Florida requires one covering subcontractors and suppliers on state and local public works. Fla. Stat. § 255.05(1) — flsenate.gov, read October 18, 2026.

where the clause is not enforceable at all

Some states legislate the other way: they remove the risk shift itself. South Carolina provides that the owner's payment to the contractor "is not, in either case, a condition precedent for payment to the construction subcontractor. Any agreement to the contrary is not enforceable." S.C. Code § 29-6-230 — scstatehouse.gov, read October 18, 2026. North Carolina's statute says the same thing in the same shape. N.C. Gen. Stat. § 22C-2 — ncleg.gov, read October 18, 2026.

California reaches the same result through its lien scheme: a term that waives or impairs another claimant's rights under that part "is void and unenforceable." Cal. Civ. Code § 8122 — leginfo.legislature.ca.gov, read October 18, 2026.

Elsewhere the restriction is narrower: Ohio lets a contingent payment contract stand but stops it from letting a subcontractor's lien claim expire while the payment is still pending. Ohio Rev. Code § 4113.62(E) — codes.ohio.gov, read October 18, 2026.

So the clause does one of 3 things depending on the state: it shifts the risk, it shifts nothing, or it shifts everything except the lien. Which one it is, is a property of the state, not of the drafting.