Title: Business Interiors Floor Covering Business Trust v. Graycor Construction Company Inc.
Citation: N/A
Docket Number: SJC-13507
State: Massachusetts
Issuer: Massachusetts Supreme Court
Date: June 17, 2024

NOTICE:  All slip opinions and orders are subject to formal 
revision and are superseded by the advance sheets and bound 
volumes of the Official Reports.  If you find a typographical 
error or other formal error, please notify the Reporter of 
Decisions, Supreme Judicial Court, John Adams Courthouse, 1 
Pemberton Square, Suite 2500, Boston, MA, 02108-1750; (617) 557-
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SJC-13507 
 
BUSINESS INTERIORS FLOOR COVERING BUSINESS TRUST  vs.  GRAYCOR 
CONSTRUCTION COMPANY INC. & others.1 
 
 
 
Suffolk.     February 7, 2024. - June 17, 2024. 
 
Present:  Budd, C.J., Gaziano, Kafker, Wendlandt, Georges, 
& Dewar, JJ. 
 
 
Contract, Construction contract, Subcontract, Performance and 
breach, Impossibility of performance.  Practice, Civil, 
Affirmative defense, Judgment, Summary judgment.  Payment.  
Time.  Judgment. 
 
 
 
 
Civil action commenced in the Superior Court Department on 
September 15, 2020. 
 
 
The case was heard by Diane C. Freniere, J., on a motion 
for summary judgment, and entry of separate and final judgment 
was ordered by her. 
 
 
The Supreme Judicial Court on its own initiative 
transferred the case from the Appeals Court. 
 
 
 
Matthew B. Lysiak (Mark B. Lavoie also present) for Graycor 
Construction Company Inc. 
 
Andrew R. Dennington (Ryan O. Forgione also present) for 
the plaintiff. 
 
1 Pacific Theatres Exhibition Corp.; Podium Developer LLC; 
and Podium Owner, LP. 
2 
 
 
Joseph A. Barra, for Associated Subcontractors of 
Massachusetts, Inc., amicus curiae, submitted a brief. 
 
Joel Lewin, Christopher W. Morog, Robert T. Ferguson, Jr., 
Garrison Doodlesack, & Isha Kumar, for Construction Industries 
of Massachusetts, Inc., amicus curiae, submitted a brief. 
 
 
KAFKER, J.  The prompt pay act, G. L. c. 149, § 29E (prompt 
pay act or act), which we interpret for the first time in this 
case, requires that parties to a construction contract approve 
or reject payment within strict time limits and provides 
procedures for doing so.  If the payor does not approve or 
reject a payment application within the act's set time limit, 
the application is "deemed to be approved."  G. L. c. 149, 
§ 29E (c).  
 
Graycor Construction Company Inc. (Graycor), a general 
contractor for a movie theater project in Boston's North End 
section, entered into a subcontract with Business Interiors 
Floor Covering Business Trust (Business Interiors).  Graycor 
failed to approve or reject three separate applications for 
periodic payments made by Business Interiors for the flooring 
work it performed on the project.  Business Interiors sued 
Graycor in the Superior Court for breach of contract and other 
claims.  The Superior Court granted Business Interiors's motion 
for summary judgment on its breach of contract claim and entered 
separate and final judgment.  Graycor appealed. 
3 
 
On appeal, Graycor asserts that there is a question of 
material fact as to whether the original contract is a "contract 
for construction" within the meaning of the act, because the 
prompt pay act references liens pursuant to G. L. c. 254, §§ 2 
and 4, in its definition of a contract for construction, and no 
such lien could have been imposed at the time of the lawsuit.  
Additionally, Graycor argues it has a valid impossibility 
defense to its failure to pay.  Business Interiors argues 
Graycor waived any such claims and, regardless, Graycor's 
arguments are without merit.  
We hold that the prompt pay act cross-references liens that 
"may be established under sections 2 or 4 of chapter 254" for a 
limited purpose:  to define in broad terms the types of 
contracts subject to the act.  G. L. c. 149, § 29E (a).  The 
strict compliance requirements for enforcement of particular 
liens do not apply, as Graycor contends.  Additionally, we hold 
that under the act, a party does not waive its defenses by 
failing to approve or reject an invoice within the strict time 
requirements established by the act.  However, a party that 
neither approves nor rejects a payment application within the 
requisite time must first make the payment in order to pursue 
any defenses in a subsequent proceeding related to the invoices, 
as the invoices have been deemed "approved."  The invoice 
payments must be made prior to, or contemporaneous with, the 
4 
 
raising of the defenses, or the defenses cannot be raised.  As 
Graycor sought to exercise its defenses in this litigation 
without ever paying the invoices, it may not pursue the 
defenses.  Summary judgment was therefore properly allowed on 
the breach of contract claim.   
This case also raises an important procedural question 
regarding the proper application of separate and final judgment 
pursuant to the prompt pay act.  The fact that a payment has 
been withheld in violation of the act does not, alone, merit the 
entry of a separate and final judgment as the Appeals Court held 
in Tocci Bldg. Corp. v. IRIV Partners, LLC, 101 Mass. App. Ct. 
133 (2022) (Tocci), a decision relied upon by the motion judge 
in the instant case.  Rather, claims, cross claims, and 
counterclaims must all be carefully examined together to 
determine whether the various elements of Mass. R. Civ. P. 
54 (b), 365 Mass. 820 (1974), are satisfied.  Here, no such 
examination took place, so we vacate and remand the rule 54 (b) 
certification to the motion judge for reconsideration.2 
1.  Background.  a.  Facts.  In November 2018, Graycor 
entered into a general contract with Pacific Theatres Exhibition 
Corp. (Pacific) for the construction of a multi-screen movie 
 
2 We acknowledge the amicus briefs submitted by Associated 
Subcontractors of Massachusetts, Inc.; and Construction 
Industries of Massachusetts, Inc., and Utility Contractors 
Association of New England, Inc. 
5 
 
theater known as ArcLight Boston Garden on property that Pacific 
leased from Podium Owner, LP, the owner of the property.  The 
original maximum price for constructing the movie theater was 
$18,962,890.  Graycor in turn executed a subcontract with 
Business Interiors for Business Interiors to complete the 
flooring for the movie theater.  The subcontract had an original 
total price of $528,426.  Change orders increased the final 
subcontract price to $608,158.  
The subcontract includes various provisions addressing 
periodic payments, including the requirement that  
"[t]he Subcontractor [Business Interiors] shall submit its 
periodic applications for payment of the Subcontract Price 
(the 'Periodic Application') on a form acceptable to 
Contractor [Graycor] not later than the 15th calendar day 
of the month . . . .   
 
"Subject to the other terms of the Subcontract, the 
Contractor will make payment of a Periodic Application for 
payment promptly upon the Contractor's receipt of payment 
from the Owner [Pacific] for the Work that is the subject 
of the Periodic Application, but in no event later than the 
date required by applicable law."  
  
On March 20, 2020, Business Interiors submitted an 
application for payment no. 19 to Graycor, seeking to be paid 
$75,745.40.  Graycor did not dispute the dollar amount listed, 
nor did it provide written notice rejecting the application.  
Nevertheless, Graycor did not pay Business Interiors any portion 
of the $75,745.40.  On April 22, 2020, Business Interiors 
submitted an application for payment no. 20 to Graycor for 
6 
 
$26,421.30.  Again, Graycor did not dispute the dollar amounts, 
nor did it provide written notice rejecting the application, but 
it did not pay any portion of the $26,421.30 requested.  On 
August 18, 2020, Business Interiors submitted its final 
application for payment in the amount of $25,022.30.  As with 
the other two applications for payment, Graycor did not dispute 
the dollar amount, provided no written notice rejecting Business 
Interiors's final application for payment, and did not pay any 
portion of the $25,022.30 itemized in the final application for 
payment. 
Around the same time, Graycor was itself attempting to get 
paid by Pacific, which was experiencing financial difficulties 
due to the COVID-19 pandemic.  In late March 2020, a Graycor 
project manager sent an e-mail message to Pacific's director of 
finance to determine the status of several overdue unpaid 
invoices.  Pacific's director of finance responded that "due to 
COVID-19, all our theaters were forced to close and at this time 
we do not have any revenue coming in" and "all of our payables 
are being held until further notice."  After that, based on the 
record before us, it appears that communication between Pacific 
and Graycor ceased. 
b.  Procedural history.  In September 2020, Business 
Interiors sued Graycor; Pacific; Podium Developer LLC; and 
7 
 
Podium Owner, LP,3 in the Superior Court, seeking to recover the 
unpaid balances.  Specifically, Business Interiors sued Graycor 
for breach of contract, breach of the covenant of good faith and 
fair dealing, violation of G. L. c. 93A, and quantum meruit.  
Business Interiors's claims centered on Graycor's failure to pay 
or formally dispute the three applications for payment within 
the time period defined by the prompt pay act.  Graycor, in its 
answer, brought cross claims against Pacific and Podium for 
breach of contract, quantum meruit, common-law indemnity, 
contribution, unjust enrichment, and violation of G. L. c. 93A.  
 
In June 2022, Business Interiors served the parties with a 
motion for summary judgment on its breach of contract (count I) 
claim against Graycor.  In response, Graycor, for the first 
time, raised an impossibility defense.  At a December 2022 
hearing on the motion, Graycor also argued for the first time 
that the subcontract was not covered by the prompt pay act 
because it was not eligible for a lien under G. L. c. 254, § 2 
or 4, at the time the lawsuit was brought.  In February 2023, 
the motion judge allowed summary judgment in favor of Business 
Interiors on its breach of contract claim, ruling that Graycor 
committed a breach of its subcontract with Business Interiors by 
 
3 Podium Owner, LP, was the owner of the underlying real 
estate, and Podium Developer LLC was the ground tenant under a 
long-term ground lease with Podium Owner, LP.  We refer to the 
two Podium entities simply as "Podium."   
8 
 
failing to submit written rejections of the three applications 
for payment within the time periods required by the prompt pay 
act.  In her decision, the motion judge explained that the 
subcontract had incorporated the act's provisions into the 
subcontract.  The motion judge did not address the issue raised 
for the first time at the hearing that the subcontract was not 
subject to the act.  Relying on Tocci, 101 Mass. App. Ct. 133, 
the motion judge entered separate and final judgment, pursuant 
to Mass. R. Civ. P. 54 (b), as to the money withheld by Graycor 
in violation of the act.  Graycor timely appealed, and we 
transferred the case from the Appeals Court on our own motion. 
2.  Discussion.  a.  Standard of review.  We review the 
Superior Court's grant of summary judgment de novo.  Adams v. 
Schneider Elec. USA, 492 Mass. 271, 280 (2023).  "Summary 
judgment is appropriate where there is no material issue of fact 
in dispute and the moving party is entitled to judgment as a 
matter of law.  We review the evidence in the light most 
favorable to the party against whom summary judgment entered," 
in this case, Graycor (quotations and alteration omitted).  Id., 
quoting Le Fort Enters., Inc. v. Lantern 18, LLC, 491 Mass. 144, 
148-149 (2023). 
b.  Prompt pay act.  The prompt pay act, like any other 
statute, "must be interpreted according to the intent of the 
Legislature ascertained from all its words construed by the 
9 
 
ordinary and approved usage of the language, considered in 
connection with the cause of its enactment, the mischief or 
imperfection to be remedied and the main object to be 
accomplished, to the end that the purpose of its framers may be 
effectuated" (citation omitted).  Reuter v. Methuen, 489 Mass. 
465, 470 (2022).  We also do not interpret words in the statute 
in isolation; we "look to the statutory scheme as a whole so as 
to produce internal consistency within the statute" (quotations 
and citations omitted).  Plymouth Retirement Bd. v. Contributory 
Retirement Appeal Bd., 483 Mass. 600, 605 (2019). 
i.  Statutory framework of the act.  The act "applies to 
certain private contracts for construction with respect to 
projects for the erection, alteration, repair, or removal of 
buildings or structures, or for other improvements to real 
property, where the 'contract with the project owner has an 
original contract price of $3,000,000 or more.'"  Tocci, 101 
Mass. App. Ct. at 134, quoting G. L. c. 149, § 29E (a).  
According to the act, "contracts for construction" are contracts 
"for which a lien may be established under [G. L. c. 254, § 2 or 
4]."  G. L. c. 149, § 29E (a).   
The act provides that  
"[e]very contract for construction shall provide reasonable 
time periods within which:  (i) a person seeking payment 
under the contract shall submit written applications for 
periodic progress payments; (ii) the person receiving the 
application shall approve or reject the application, 
10 
 
whether in whole or in part; and (iii) the person approving 
the application shall pay the amount approved." 
   
G. L. c. 149, § 29E (c).  For submission of payment, the time 
period is a maximum of thirty days, "beginning with the end of 
the first calendar month occurring at least [fourteen] days 
after the person seeking payment has commenced performance."  
Id.  For approval or rejection of an application for payment, 
the time period is a maximum of fifteen days after submission of 
the application, though this time period "may be extended by 
[seven] days" for "each tier of contract below the owner of the 
project."  Id.  Payment must be generally made forty-five days 
after the application for payment is approved.  Id.   
 
According to the act, "[a]n application for a periodic 
progress payment which is neither approved nor rejected within 
the time period shall be deemed to be approved unless it is 
rejected before the date payment is due."  G. L. c. 149, 
§ 29E (c).  The act requires that a rejection of an application 
for payment "be made in writing" and "include an explanation of 
the factual and contractual basis for the rejection," along with 
a certification that the rejection is "made in good faith."  Id.  
If rejected, the application "shall be subject to the applicable 
dispute resolution procedure" provided in the construction 
contract.  Id.  In addition, the act provides that, subject to a 
few exceptions, any provision in a "contract for construction 
11 
 
which makes payment to a person performing the construction 
conditioned upon receipt of payment from a third person that is 
not a party to the contract shall be void and unenforceable."  
G. L. c. 149, § 29E (e).  Further, any contractual provision 
"which purports to waive or limit any provisions of [the act] 
shall be void and unenforceable."  G. L. c. 149, § 29E (g). 
Under the plain language of the act, Graycor had twenty-two 
days from the date of submission of each of Business Interiors's 
three applications for payment to approve or reject the 
application.4  However, Graycor neither approved nor rejected 
Business Interiors's applications within these time periods.  
Thus, according to the act, all three applications for payment 
were "deemed to be approved," and Graycor was required to pay 
them.  G. L. c. 149, § 29E (c). 
Graycor and Business Interiors appear to agree on this 
basic requirement of the act but disagree over whether this 
decides the question of summary judgment on count I.  Graycor 
disputes whether the subcontract between it and Business 
Interiors is a "contract for construction" as defined by G. L. 
c. 149, § 29E (a), arguing that there is a triable issue of fact 
 
4 Graycor had twenty-two days because it had (a) the initial 
fifteen days prescribed by the act plus (b) an additional seven 
days because Business Interiors was a subcontractor and thus was 
one tier below the original contract between Pacific and 
Graycor.  
12 
 
as to whether the contract was eligible for a lien under G. L. 
c. 254, § 2 or 4.  Further, Graycor contends it has a viable 
impossibility defense due to the intervening COVID-19 pandemic, 
which resulted in Pacific ceasing payments to Graycor.  Business 
Interiors contends that both issues were waived, and if they 
were not, neither has merit.  We address each issue in turn.  
ii.  Definition of "contract for construction."  We 
conclude that the issue whether the subcontract meets the 
definition of a "contract for construction," which was raised 
for the first time at the hearing on the summary judgment 
motion, was not properly raised, and that it was not an abuse of 
discretion for the motion judge to disregard it.  Cf. Boss v. 
Leverett, 484 Mass. 553, 563 (2020) (finding argument not 
properly presented where issue was not clearly raised in cross 
motion for summary judgment).  However, because Graycor presents 
an undecided question regarding the meaning of "contract for 
construction" in the act, we address the merits.  See Clark v. 
Rowe, 428 Mass. 339, 341 (1998) ("Although the issue was not 
preserved for appellate review, the question . . . is unanswered 
in this Commonwealth.  The issue is fully briefed and likely to 
arise in other cases.  We choose in our discretion to discuss 
the issue" [footnote omitted]).  We conclude, as a matter of 
law, that the subcontract at issue is a "contract for 
construction" under the prompt pay act. 
13 
 
The act defines a "contract for construction" as "a 
contract for which a lien may be established under [G. L. 
c. 254, § 2 or 4,] on a project for which the person whose 
contract with the project owner has an original contract price 
of $3,000,000 or more."  G. L. c. 149, § 29E (a).  Under G. L. 
c. 254, § 2:  
"A person entering into a written contract with the owner 
of any interest in real property, or with any person acting 
for, on behalf of, or with the consent of such owner for 
the whole or part of the erection, alteration, repair or 
removal of a building, structure, or other improvement to 
real property, or for furnishing material or rental 
equipment, appliances, or tools therefor, shall have a lien 
upon such real property . . . owned by the party with whom 
or on behalf of whom the contract was entered into . . . 
when notice of said contract is filed or recorded in the 
registry of deeds . . . ."  
  
While G. L. c. 254, § 4, provides for subcontractor liens:  
"Whoever furnishes labor, . . . or who furnishes material, 
or both labor and material, or furnishes rental equipment, 
appliances or tools, or who performs professional services, 
under a written contract with a contractor, or with a 
subcontractor of such contractor, may file or record in the 
registry of deeds . . . a notice of his contract . . . .  
Upon filing or recording a notice . . . and giving actual 
notice to the owner of such filing, the subcontractor shall 
have a lien upon such real property . . . owned by the 
party who entered into the original contract . . . ." 
  
The original contract price is over $3 million, so the only 
issue is whether the subcontract is "a contract for which a lien 
may be established under" G. L. c. 254, § 2 or 4.  Graycor 
argues that because any lien that might have been established on 
the real property interest owned by Pacific, the party that 
14 
 
entered into the original contract, would have been dissolved 
when Pacific's lease with the owner was terminated, there is a 
triable issue whether Graycor and Business Interiors's 
subcontract meets the definition of a "contract for 
construction" under G. L. c. 149, § 29E (a).  We disagree. 
By referencing contracts for which liens "may be 
established" pursuant to G. L. c. 254, §§ 2 and 4, the prompt 
pay act defines its scope broadly, not narrowly.  It does so in 
two respects.  First, it refers to construction contracts for 
which liens "may be established," not to contracts for which 
liens have been established, and thus, in defining its scope, it 
does not impose the strict compliance requirements necessary for 
the enforcement of particular liens as apparently argued by 
Graycor.  Second, G. L. c. 254, §§ 2 and 4, describe a very wide 
range of construction contracts for which liens may be created.  
Thus, G. L. c. 254, §§ 2 and 4, are referenced in the prompt pay 
act not to narrow the act's applicability, but to demonstrate 
that the act encompasses within its ambit a broad scope of 
construction contracting.      
 Even Graycor recognizes that, at least when the contract 
was entered into, Business Interiors might have established a 
lien pursuant to G. L. c. 254, § 4, against Pacific's leasehold 
interest.  It just argues that "[a]t the time [Business 
Interiors] filed this lawsuit on September 15, 2020, Podium 
15 
 
Developer LLC, the holder of the ground lease and landlord for 
the subject project, terminated Pacific's lease," and thus any 
lien would have been dissolved.  See Trace Constr., Inc. v. Dana 
Barros Sports Complex, LLC, 459 Mass. 346, 357 (2011) ("As a 
general matter, a lien on a leasehold is extinguished when the 
rights of the lessee expire").  As this is not a lien 
enforcement action, however, the only issue is whether a lien 
may have been established pursuant to this subcontract.5  Here 
that requirement was clearly met at least at the time the 
subcontract was executed.  Put more simply, this was the type of 
construction contract for which a lien pursuant to G. L. c. 254, 
§ 2 or 4, might have been established.    
iii.  Availability of common-law defenses under the act.  
The primary issue presented in this case is whether the prompt 
pay act precludes a general contractor from asserting common-law 
affirmative defenses to a breach of contract claim based on the 
failure to pay.  As discussed supra, the act provides:  "An 
 
5 Business Interiors moves to strike from the record 
appendix the lease termination document included by Graycor on 
the ground that, in violation of Mass. R. A. P. 16 (e), as 
appearing in 481 Mass. 1628 (2019), and Mass. R. A. P. 18 (a), 
as appearing in 481 Mass. 1637 (2019), the lease termination 
document was never submitted as part of the record before the 
Superior Court and Graycor failed to obtain leave of this court 
to include the document.  Because our decision does not rest on 
the lease termination document, we need not consider the motion.  
See Matter of the Discipline of an Attorney, 442 Mass. 660, 674 
n.29 (2004). 
16 
 
application for a periodic progress payment which is neither 
approved nor rejected within the time period shall be deemed to 
be approved unless it is rejected before the date payment is 
due."  G. L. c. 149, § 29E (c).  The act does not, however, 
address common-law defenses.  We conclude that common-law 
defenses are not precluded by the act, even if a contractor 
fails to approve or reject an application for payment as 
required.  However, a contractor that does not approve or reject 
an application for payment in compliance with the time periods 
and other requirements of the act must pay the amount due prior 
to, or contemporaneous with, the invocation of any common-law 
defenses in any subsequent proceeding regarding enforcement of 
the invoices.  In the instant case, no such payment was made.6 
 
"[A] statutory repeal of the common law will not be lightly 
inferred; the Legislature's 'intent must be manifest.'" 
Passatempo v. McMenimen, 461 Mass. 279, 290 (2012), quoting 
Comey v. Hill, 387 Mass. 11, 20 (1982).  The Legislature's 
 
6 Justice Wendlandt's opinion, concurring in part and 
dissenting in part (concurrence-dissent), incorrectly states 
that the claim is waived upon the filing of any responsive 
pleading to a claim for breach of contract against a nonpaying 
contractor.  See post at    .  The claim is preserved as long as 
the invoice is paid no later than when the defense is first 
presented in such a proceeding.  Put simply, a contractor is 
free to raise defenses, provided it pays the invoice before or 
contemporaneously with raising those defenses.  What the 
contractor cannot do is what Graycor did here, raise the 
defenses without paying the invoice. 
17 
 
"intent may be 'clearly expressed' in one of two ways:  by words 
in the statute itself clearly stating that the statute 
supersedes the common law, or by 'necessary implication.'" 
Chelsea Hous. Auth. v. McLaughlin, 482 Mass. 579, 590 (2019), 
quoting Lipsitt v. Plaud, 466 Mass. 240, 244 (2013).  "A statute 
preempts common-law doctrine by necessary implication where the 
doctrine is so repugnant to and inconsistent with the statute 
that both cannot stand" (quotations and citation omitted).  
McLaughlin, supra at 591.  In other words, "[c]an the common-law 
doctrine [at issue] and the statute reasonably coexist in 
harmony, or must the common-law doctrine necessarily give way in 
order to effectuate the purpose of the statute?"  Id. 
 
We emphasize that the act does not expressly preempt all 
common-law defenses to breach of contract.  If the Legislature 
intended for the failure to accept or reject payment within the 
tight time frames established by the act to eliminate all 
common-law defenses, "we think it would have done so explicitly" 
(citation omitted).  See Lipsitt, 466 Mass. at 248-249.  We 
likewise conclude that the act does not completely eliminate 
common-law defenses by necessary implication.  Rather the 
statutory requirements and the common-law defenses can coexist, 
so long as payment is required to be made prior to, or 
contemporaneous with, the raising of any such defenses in any 
proceeding relating to the enforcement of such invoices.  See 
18 
 
McLaughlin, 482 Mass. at 591.  More precisely, as explained by 
Associated Subcontractors of Massachusetts, Inc. (ASM), in its 
amicus brief:  "To the extent the [contractor] has any viable 
contract or common[-]law defenses to payment, such defenses are 
still available for presentation in a subsequent forum.  
However, the contractor must first pay the funds purportedly 
owed and then seek to disgorge such funds in a succeeding 
adjudication."7 
In sum, payment of overdue approved invoices must be made 
prior to, or contemporaneous with, raising common-law defenses, 
or the defenses cannot be raised.8  
 
7 This reading of the act is buttressed by the legislative 
history.  While the act provides significant protections to 
subcontractors, the legislation was subject to heavy lobbying by 
both contractors and subcontractors, and it was ultimately the 
product of a hard-fought compromise.  Cheney, New Law Requires 
"Prompt Pay" for Construction Contractors, State House News 
Service, Aug. 16, 2010.  While contractors had previously 
opposed a broader version of the bill, "the most objectionable 
elements" of the legislation, in their view, were successfully 
"negotiated out."  Id.  The informed interpretation of the ASM 
in its amicus brief, which we discuss and adopt supra, reflects 
this hard-fought compromise. See generally Bantz, Legislation in 
Mass. Promises Major Changes for Construction Law Bar, 
Massachusetts Lawyers Weekly, Aug. 30, 2010 (noting that ASM 
"spent five years working to get the bill passed").  The 
legislation did not eliminate contractor defenses altogether, as 
Business Interiors argues, or have no meaningful consequence, as 
Graycor contends, but rather requires a contractor to pay the 
invoices in order to exercise its defenses. 
 
8 In some cases, preliminary injunctions ordering immediate 
payment of outstanding invoices may also be justified when the 
failure to pay an invoice causes irreparable harm to a 
 
19 
 
We conclude that such a reading of the statute is a 
necessary implication of it.  The Legislature's determination -- 
that the failure to accept or reject a periodic payment 
application within the defined time requirements is deemed an 
approval of the payment -- must have meaningful consequences.9 
Allowing common-law defenses to be raised and pursued without 
paying the now "deemed to be approved" invoices would render 
 
subcontractor's business.  See Massachusetts Port Auth. v. Turo 
Inc., 487 Mass. 235, 247 (2021), quoting GTE Prods. Corp. v. 
Stewart, 414 Mass. 721, 724 (1993) ("A plaintiff experiences 
irreparable injury if there is no adequate remedy at final 
judgment").  While economic harm alone does not usually rise to 
the level of irreparable harm, economic loss "may constitute 
irreparable harm where the loss threatens the very existence of 
the movant's business."  Hull Mun. Lighting Plant v. 
Massachusetts Mun. Wholesale Elec. Co., 399 Mass. 640, 643 
(1987).  Moreover, the combination of noneconomic and economic 
harm may constitute irreparable harm.  See Loyal Order of Moose, 
Inc., Yarmouth Lodge # 2270 v. Board of Health of Yarmouth, 439 
Mass. 597, 603 (2003) (smoking ban caused irreparable harm to 
lodge where ban caused both substantial decrease in revenue and 
"the likelihood that employees will be laid off and the hours of 
operation diminished").  We do not decide whether such 
injunctive relief would have been justified in the instant case, 
as no such injunctive relief was sought.  
       
9 The concurrence-dissent asserts that "[t]he act provides 
no private right of action or alternative mechanism to 
subcontractors to secure prompt payment."  Post at note 2.  This 
ignores the explicit statutory mandate to include the prompt 
payment provisions in all applicable construction contracts, 
which are of course then enforceable by the private parties in a 
breach of contract claim.  See G. L. c. 149, § 29E (c), (d) 
("Every contract for construction shall provide reasonable time 
periods . . ." [emphasis added]).  Moreover, any contract terms 
contrary to the act are void and unenforceable.  G. L. c. 149, 
§ 29E (g).  
 
20 
 
this approval to be of no import.10  This "is so repugnant to and 
inconsistent with the statute that both cannot stand" 
(quotations and citation omitted).  McLaughlin, 482 Mass. at 
591.  Thus, in contrast to a complete waiver, the payment of the 
amounts due in order to raise common-law defenses is a necessary 
implication of the "deemed approved" provision in the statute. 
In the instant case, however, Graycor sought to raise and 
pursue defenses without ever paying the invoices.  This it 
cannot do.  Summary judgment was therefore properly allowed on 
count I of Business Interiors's complaint.    
c.  Separate and final judgment.  Relying on the reasoning 
of the Appeals Court in Tocci, the Superior Court issued a 
separate and final judgment on count I of Business Interiors's 
 
10 According to the concurrence-dissent, the only 
consequence to a contractor that fails to pay an approved 
invoice is that the contractor would be in material breach of 
the contract.  See post at    ,    .  It is not surprising that 
this issue is neither raised nor addressed by the parties.  That 
is perhaps because there is "little doubt" that the repeated 
failure to pay approved invoices would be a material breach and 
would excuse the nonbreaching party from its obligations for 
further performance under the contract.  See G4S Tech. LLC v. 
Massachusetts Tech. Park Corp., 479 Mass. 721, 734 (2018).  
This, however, does not address the issue of defenses, as a 
breaching party may of course raise defenses to a material 
breach of contract.  See Anthony's Pier Four, Inc. v. HBC 
Assocs., 411 Mass. 451, 470-471 (1991) (analyzing breaching 
party's defense that nonbreaching party's postbreach conduct 
waived its claim).  The concurrence-dissent therefore provides 
no significant meaning or consequence to the "deemed approved" 
provision of the act.  See Ropes & Gray LLP v. Jalbert, 454 
Mass. 407, 412 (2009) ("A statute should be construed so as to 
give effect to each word . . .").    
21 
 
complaint.  Because we conclude that the prompt pay act, 
particularly as clarified by our decision today, requires a 
traditional and not truncated Mass. R. Civ. P. 54 (b) analysis, 
we briefly address this issue as well, and vacate the rule 
54 (b) certification decision.  See Long v. Wickett, 50 Mass. 
App. Ct. 380, 385 n.6 (2000) ("because important policy 
interests are implicated . . . we raise and resolve the issue 
[of rule 54 (b) certification] sua sponte")  
In Tocci, 101 Mass. App. Ct. at 142-143, rather than 
conducting a traditional analysis of the factors required for 
rule 54 (b) certification, the Appeals Court concluded that 
separate and final judgment was proper because "[t]o allow the 
defendants to retain the moneys wrongfully withheld in violation 
of the statute until the final resolution of their 
postcompletion contract action would eviscerate the scheme for 
prompt payment or rejection-and-resolution created by the 
Legislature."  Nothing, however, in the act's text indicates 
that the Legislature intended the prompt pay act to provide for 
immediate appeals of the failure to accept or reject a periodic 
payment.11  See DeCosmo v. Blue Tarp Redev., LLC, 487 Mass. 690, 
 
11 Moreover, nothing in the legislative history indicates 
any inclination by the Legislature to permit interlocutory 
appeals.  The legislative record is entirely silent on the 
question of appellate review.  
 
22 
 
695 (2021) ("If the [statute's] language is clear and 
unambiguous, it must be interpreted as written" [citation 
omitted]).  "[A]bsent special authorization, an appellate court 
will reject attempts to obtain piecemeal review of trial rulings 
that do not represent final dispositions on the merits" 
(quotations and alteration omitted).  Fabre v. Walton, 436 Mass. 
517, 520-521 (2002), S.C., 441 Mass. 9 (2004), quoting Ashford 
v. Massachusetts Bay Transp. Auth., 421 Mass. 563, 565 (1995).  
The unduly expansive interpretation of the preemptive effect of 
the act's "scheme" set out in Tocci, and adopted by the motion 
judge here, undermines the ordinary principles cautioning 
against interlocutory appeals.  
We therefore emphasize that the traditional rule 54 (b) 
requirements apply in prompt pay act cases and the truncated 
analysis applied by the Appeals Court in Tocci does not.12  In 
the instant case, we have multiple claims by Business Interiors 
 
12 We note that the Appeals Court in Tocci, and the motion 
judge here, did not have the benefit of this decision.  Also, as 
a practical matter, the requirement that a contractor pay the 
invoices prior to, or contemporaneous with, the raising of any 
common-law defenses should address the particular problem with 
which the Superior Court was presented here under rule 54 (b), 
that is, whether to allow a patent violation of the prompt pay 
act to go unresolved while the litigation over that violation 
continued.  When the invoice is actually paid to preserve the 
defense, the issue that was of most concern to the Superior 
Court in this case and the Appeals Court in Tocci is, for rule 
54 (b) purposes, obviously no longer present. 
     
23 
 
against Graycor, Pacific, and Podium in addition to its prompt 
pay act claim,13 and cross claims by Graycor against Podium and 
Pacific.14  All of these additional claims should have been 
considered as part of the motion judge's rule 54 (b) analysis, 
but they were not, due to the motion judge's reliance on the 
abbreviated analysis in Tocci.  See Barbetti v. Stempniewicz, 
490 Mass. 98, 104 (2022), quoting Long, 50 Mass. App. Ct. at 391 
("To satisfy the requirements of rule 54 [b] . . . the claim 
[finally] adjudicated must be a 'claim for relief' separable 
from and independent of the remaining claims in the case"); 
Long, supra at 390-391 ("Although claims and counterclaims are 
generally considered separate claims under rule 54 [b], the 
presence of a counterclaim weighs heavily against the grant of 
54 [b] certification, particularly when there is a substantial 
interdependence and overlap between dismissed claims and pending 
counterclaims" [citations, quotations, and alterations 
 
13 Business Interiors brought additional claims alleging 
breach of the covenant of good faith and fair dealing, violation 
of G. L. c. 93A, and quantum meruit against Graycor, as well as 
quantum meruit claims against Pacific and quantum meruit and 
unjust enrichment claims against Podium.  It also represents 
that it is prepared to dismiss its claims against Graycor if the 
invoice payment is made and its attorney's fees are paid. 
 
14 In its answer to Business Interiors's complaint, Graycor 
brought cross claims against Pacific and Podium alleging breach 
of contract, quantum meruit, common-law indemnity, contribution, 
unjust enrichment, and violation of G. L. c. 93A. 
 
24 
 
omitted]).  See also Yanis v. Paquin, 96 Mass. App. Ct. 134, 140 
n.12 (2019) (extending counterclaim analysis in rule 54 [b] 
context to cross claims).  All of this requires a reversal and 
remand of the rule 54 (b) certification.15 
3.  Conclusion.16  The certification and entry, pursuant to 
Mass. R. Civ. P. 54 (b), of the partial judgment for Business 
Interiors on count I of the complaint is vacated; the order on 
summary judgment is restored to its status under the second 
sentence of rule 54 (b); and the case is remanded to the 
Superior Court for further proceedings consistent with this 
opinion.  
 
 
 
 
 
 
 
So ordered. 
 
15 Finally, the concurrence-dissent's suggestion that we 
leave the plaintiff with a Pyrrhic victory is confusing to say 
the least, especially given its recognition that separate and 
final judgment was improperly allowed.  See post at    .  We 
have not definitively ruled on the rule 54 (b) motion, we have 
just stated that the correct legal standards need to be applied.  
We have also in no way suggested that a preliminary injunction 
would not have been appropriate here, if the requirements of 
irreparable harm had been met, but no such relief was requested.   
Consequently, it is the concurrence-dissent, by not requiring 
the payment of invoices prior to, or contemporaneous with, the 
exercise of defenses, that leaves all subcontractors with less 
protection, or in the words of the concurrence-dissent, a 
Pyrrhic victory, against such improper payment practices by 
contractors in the future.   
 
16 Because multiple claims and cross claims remain 
outstanding, we do not reach the question whether Business 
Interiors is entitled to attorney's fees and costs.  As the 
Superior Court stated, "the case has not been entirely 
resolved," and thus, "the issue of attorney's fees and costs is 
best addressed all at once at the conclusion of the litigation." 
 
WENDLANDT, J. (concurring in part and dissenting in part, 
with whom Dewar, J., joins).  Time is of the essence under the 
prompt pay act, G. L. c. 149, § 29E (act), as the name suggests; 
it mandates that construction contracts include provisions that 
require timely payment of invoices.  G. L. c. 149, § 29E (c) 
("Every contract for construction shall provide reasonable time 
periods within which:  [i] a person . . . shall submit written 
applications for . . . payments; [ii] the person receiving the 
application shall approve or reject the application . . . ; and 
[iii] the person approving the application shall pay the amount 
approved").  These prompt payment provisions, the court rightly 
concludes, required Graycor Construction Company Inc. (Graycor) 
to accept or reject Business Interiors Floor Covering Business 
Trust (Business Interiors) invoices within the specified time 
frame.  See ante at    .  Having not done so, the invoices are 
"deemed to be approved," see G. L. c. 149, § 29E (c), and 
Graycor was required to promptly pay the owed funds.1  In other 
words, Graycor is in material breach of the agreement not only 
because it failed to pay Business Interiors's invoices but 
 
1 The time frame for payment pursuant to the act was 
incorporated into the contract.  The price and billing 
requirements attachment to the contract states, "the Contractor 
will make payment of a Periodic Application for payment promptly 
upon the Contractor's receipt of payment from the Owner for the 
Work that is the subject of the Periodic Application, but in no 
event later than the date required by applicable law" (emphasis 
added).  See ante at    . 
2 
 
because it failed to pay those invoices promptly.  G4S Tech. LLC 
v. Massachusetts Tech. Park Corp., 479 Mass. 721, 733-734 
(2018), quoting EventMonitor, Inc. v. Leness, 473 Mass. 540, 546 
(2016) ("a material breach of a contract occurs when the breach 
concerns an 'essential and inducing feature of the contract'").   
I also agree with the court that, under the act, failure to 
make timely payments does not waive defenses to breach of 
contract.  See ante at    .  Nothing in the act itself suggests 
such a waiver.  See G. L. c. 149, § 29E (c)-(g).  And, such a 
waiver is unsupported by the legislative history, which shows 
the act's terms were the result of a hard-fought compromise in 
which the Legislature ultimately chose not to enact stronger 
statutory remedies to address untimely payments.  See Cheney, 
New Law Requires "Prompt Pay" for Construction Contractors, 
State House News Service, Aug. 16, 2010 ("The bill was the 
subject of a torrent of lobbying," and during "contentious" 
negotiations, "[c]ontractors . . . negotiated out" certain 
elements of bill).  See, e.g., House Bill No. 1789 (Jan. 2007) 
(earlier version of bill providing additionally for recovery of 
interest on unpaid amounts as well as attorney's fees).  As a 
result, the court properly concludes that such defenses are 
preserved and may be asserted in a subsequent claim.  See, e.g., 
Suffolk Constr. Co. v. Benchmark Mechanical Sys., Inc., 475 
Mass. 150, 154-155 (2016) (allowing contractor to pursue unjust 
3 
 
enrichment claim against subcontractor and bank after it 
mistakenly paid subcontractor).  
And I agree with the court's holding that the act provides 
no basis for dispensing with our usual stringent standard for 
entry of separate and final judgment under Mass. R. Civ. P. 
54 (b), 365 Mass. 820 (1974).  See Barbetti v. Stempniewicz, 490 
Mass. 98, 103 (2022).  In the absence of a specific provision so 
stating, the act's goal that subcontractors be paid timely does 
not dispense with the ordinary rules of civil procedure and 
their disfavor for piecemeal appeals. 
I write separately because I disagree with the court's 
further creation of a remedy unsupported by the act -- namely, 
its decision to deem these defenses, which the court agrees are 
preserved, nevertheless, to be waived upon the filing of any 
responsive pleading to a claim for breach of contract against a 
nonpaying contractor like Graycor.  Once the responsive pleading 
to the suit is filed, the previously preserved defenses vanish, 
according to the court.  See ante at note 6. 
But the act merely requires the inclusion of specific terms 
in construction contracts governing the processing of payments, 
which can be enforced through a breach of contract claim.2  The 
 
2 The act provides no private right of action or alternative 
mechanism to subcontractors to secure prompt payment. 
 
4 
 
Legislature chose to go no further.  Contrast, e.g., House Bill 
No. 4730 (May 8, 2008) (earlier version of bill more broadly 
establishing "rights and obligations prescribed by . . . 
statute," including that parties to construction contracts 
"shall make all payments in accordance with the terms of that 
contract, which shall be in accordance with the provisions of 
this section").  For better or worse, this is a feature of the 
act, not a latent error to be fixed by judicial fiat.  See 
Commonwealth v. Calvaire, 476 Mass. 242, 245 (2017) ("We do not 
read into the statute a provision which the Legislature did not 
see fit to put there, nor add words that the Legislature had an 
option to, but chose not to include" [citation omitted]).  
Indeed, analysis of the act and its history shows, as the court 
concludes, that no such waiver formed any part of the compromise 
legislation.  See ante at note 7. 
Contrary to the court's assertion, see ante at    , the act 
still has "meaningful consequences."  For example, subject to 
certain conditions, the act renders "void and unenforceable" 
contractual terms that purport to require a subcontractor who 
has not been paid timely to continue to work.  G. L. c. 149, 
§ 29E (f).  Moreover, payment delayed beyond the time frame set 
forth by the contractual provisions required by the act 
constitutes a material breach giving rise to a claim for breach 
of contract.  This does not mean that a subcontractor always 
5 
 
must await resolution of defenses to the breach of contract 
claim before obtaining payment for the invoices "deemed . . . 
approved"; a subcontractor can bring a motion for a preliminary 
injunction, if it can show (1) a likelihood of success on the 
merits;3 (2) that irreparable harm will result from denial of the 
injunction;4 and (3) that, in light of its likelihood of success 
on the merits, the risk of irreparable harm outweighs the 
potential harm to the breaching party.5  See Boston Firefighters 
 
3 The likelihood of success on the merits prong of the 
preliminary injunction standard is met where, as here, a 
subcontractor has not been paid timely as required by the 
contractual provisions mandated by the act.  See Doe v. 
Worcester Pub. Sch., 484 Mass. 598, 601-603 (2020) (likelihood 
of success on merits where school district's action failed to 
abide by unambiguous statutory language that expelled student 
receive hearing with superintendent).   
 
4 Economic loss can meet this prong only where nonpayment 
"threatens the very existence of [the] business."  Hull Mun. 
Lighting Plant v. Massachusetts Mun. Wholesale Elec. Co., 399 
Mass. 640, 643 (1987) (municipal lighting company's nonpayment 
constituted irreparable harm to electric wholesaler because 
wholesaler "relie[d] solely on payments from municipal lighting 
companies to meet its bond obligations").  Thus, while a 
preliminary injunction will be unavailable to parties who are 
not at risk of such dire consequences, the tool may be used by 
the most vulnerable parties whom the act targeted for 
protection.  See Cheney, New Law Requires "Prompt Pay" for 
Construction Contractors, State House News Service, Aug. 16, 
2010 (describing act as "a lifeline to aggrieved construction 
[sub]contractors . . . many of which . . . reduced staffing 
levels or [went] out of business altogether" and for which "slow 
payment ha[d] become [the] single most important business 
issue"). 
 
5 The act demonstrates the Legislature's balancing in favor 
of those who do not receive timely payment of invoices.  See 
G. L. c. 149, § 29E (c)-(g). 
6 
 
Union, Local 718, Int'l Ass'n of Fire Fighters, AFL-CIO v. 
Boston, 491 Mass. 556, 562 (2023), citing Garcia v. Department 
of Hous. & Community Dev., 480 Mass. 736, 747 (2018); Hull Mun. 
Lighting Plant v. Massachusetts Mun. Wholesale Elec. Co., 399 
Mass. 640, 642-643 (1987) (affirming "preliminary injunction 
ordering [plaintiff] to continue making payments to [defendant] 
as required by [their contracts]").  This garden-variety tool, 
if granted, comports with the act's intent to ensure 
subcontractors receive prompt payment, see G. L. c. 149, 
§ 29E (c), without quashing a contractor's ability to marshal 
defenses.  See ante at   ("We emphasize that the act does not 
expressly [or by implication] preempt all common-law defenses to 
breach of contract").  Of course, a party so enjoined, which 
fails to pay, is subject to contempt.  United Factory Outlet, 
Inc. v. Jay's Stores, Inc., 361 Mass. 35, 37 (1972) (upholding 
civil contempt decree against defendants who failed to abide by 
preliminary injunction).  
By contrast, the court grants Business Interiors a Pyrrhic 
victory.  On the one hand, it affirms summary judgment in favor 
of Business Interiors.  On the other hand, it remands the case 
for further proceedings, further delaying any payment to 
Business Interiors, having concluded, albeit correctly, that the 
Superior Court judge's entry of separate and final judgment on 
7 
 
the breach of contract claim was improper under Mass. R. Civ. P. 
54 (b).6  For these reasons, I respectfully dissent in part. 
 
 
6 Here, of course, the claims, counterclaims, and cross 
claims stem from the same facts.  See Barbetti, 490 Mass. at 103 
(rule 54 [b] requires claim to be "separable from and 
independent of the remaining claims in the case" and not 
"inextricably intertwined" with them [citations omitted]).