The clause incorporates prime contract terms into the subcontract, extending obligations regarding schedule, quality, notice, claims procedures, and dispute resolution to the subcontractor.
Scope of incorporation is frequently ambiguous.
Alternative Names:
Flow-Down Clause|Incorporation by Reference
Why it Matters?
Whether a flow-down provision incorporates the prime contract's dispute resolution clause is the recurring ambiguity, since a subcontractor bound to arbitrate with the owner may be compelled into a forum it never negotiated. Courts divide on whether general incorporation language reaches procedural provisions or only substantive obligations. Notice requirements also flow down, and a subcontractor missing a prime contract deadline it never saw loses the claim.
Frequently Confused with
Related terms
Frequently asked questions
Does flow-down incorporate dispute resolution provisions?
What is the practical trap?
