signing a lien waiver prior to getting paid

[CopperTone]

SO a GC owes us about 40k. They want us to sign a lien waiver before they give us payment. The form specifically states that we are giving up all rights to lien even if we don't get paid. I told them I wouldn't sign it until I actually had a check in my hand. They claim they won't mail it and have me fax it after - I have to fax it before they release and mail the check. I told them that would be the dumbest thing anyone could do. They said - well that's our policy. You can come to our offices and pick it up - it is a 3 hr round trip for me. I told them it is our policy to not sign waivers before we get paid.

They told me they have never had a problem before with any other sub. I refuse to waive my rights before I get paid - what a PITA to have to go pick up the check.
They don't trust us that we will fax the waiver after we get the check and I don't trust them to send the check after we sign the waiver.

 

[Pierre C Belarge]

I would check with your attorney first. Signing any legal document with a GC without understanding the consequences is not smart at all.

 

[Pierre C Belarge]

I told them it is our policy to not sign waivers before we get paid.

They told me they have never had a problem before with any other sub. I refuse to waive my rights before I get paid - what a PITA to have to go pick up the check.
They don't trust us that we will fax the waiver after we get the check and I don't trust them to send the check after we sign the waiver.

Smart policy.

or
Stop the check after writing it.

 

[bradleyelectric]

Send a waiver stating you give up right to lein when the check for $xxxxx.xx clears. Have you talked about that option with them?

 

[SEO]

I'd drive the three hours for the 40k. Doesn't seem to be enough trust between the two of you. If you go to pick up your check I hope they don't make up any excuses and not give it to you.

 

[resistance]

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Smart policy.

or
Stop the check after writing it.

I agree!!!


I'm 100% against the GC in this case---seeing that you have no reason not to sign the waiver after receiving your money. The GC is stalling--what an idiot!!!

 

[CopperTone]

I'd drive the three hours for the 40k. Doesn't seem to be enough trust between the two of you.

The job went fine - no real lack of trust issue from us - at the end they throw this curve ball. BTW - this is only a progress payment not the whole amount - so I would have to go there at least 2 more times for more checks.

I will discuss adding in language that the waiver is contingent upon the check clearing.

 

[hurk27]

[/COLOR]

Smart policy.

or
Stop the check after writing it.

If a GC were to place a stop payment on a check after your fulfillment of your obligations, it would be check fraud, criminally chargeable.
but on the same token, if you failed to send them the waver of lien after cashing the check, then then you have not fulfilled your obligations, they could pull you into court, and could cause you to have to refund the money and more if it causes a lost sale of the house, or of penalties impose by the lender for not closing the house on time.

I would stick to your guns as it seems suspicious that if they are intending to pay, would not send the check, because they have more to loose than you.
Think about it, if they were to try to take you to court, because you held up the sale of the house, or caused penalties, they would not have a leg to stand on in court, because the court would have to back you because they didn't pay. so it would be their fault for the lost sale or penalties.

so stand your ground, or offer a happy medium, and meet them halfway to there office.

 

[resistance]

The job went fine - no real lack of trust issue from us - at the end they throw this curve ball. BTW - this is only a progress payment not the whole amount - so I would have to go there at least 2 more times for more checks.

I will discuss adding in language that the waiver is contingent upon the check clearing.

Well if it's a progess payment, then you should be able to stop work, until it's resolved. If it comes down to it, throw them in collections. That's a lot money!!!! Do not cancel the electrical permit to make a statement. They could easily say they fired you, and hire another contractor to finish your work---depending on your jurisdiction.

 

[celtic]

FILE a lien and send them a copy of it

 

[resistance]

FILE a lien and send them a copy of it

Exactly!!!! This will hold them up.

 

[Volta]

FILE a lien and send them a copy of it

Exactly. They aren't paying as agreed.

 

[hurk27]

The job went fine - no real lack of trust issue from us - at the end they throw this curve ball. BTW - this is only a progress payment not the whole amount - so I would have to go there at least 2 more times for more checks.
I will discuss adding in language that the waiver is contingent upon the check clearing.

Then I would not do a full lien waver, and do a partial waver of lien, once you have wave off totally you have almost no recourse to get your money, and trying to go to court after the fact, in many states is a joke, here in Indiana, they can settle for pennies on the dollar.

If they have a fear, of not getting a waver, then tell them they need to use a title company to do there disbursements of funds, to take the risk out of the picture. If you are done the partial payments should have been made, way before the lien waver was even needed.
This sounds like a scam to get out of paying.

 

[dbuckley]

Check out this previous thread on this issue.

 

[resistance]

Then I would not do a full lien waver, and do a partial waver of lien, once you have wave off totally you have almost no recourse to get your money, and trying to go to court after the fact, in many states is a joke, here in Indiana, they can settle for pennies on the dollar.

If they have a fear, of not getting a waver, then tell them they need to use a title company to do there disbursements of funds, to take the risk out of the picture. If you are done the partial payments should have been made, way before the lien waver was even needed.
This sounds like a scam to get out of paying.

Well said! Thank goodness I'm not in the picture....... when it comes to a large amount of money, business is out door if you don't pay me!!!

 

[danickstr]

What they are asking you to do is give up the rights the law has determined you are entitled to. It may not even be legal to ask you to do this. I would at least put a few hundred towards a lawyer consultation to determine if they are conspiring against you.

 

[quogueelectric]

Buy yourself a pair of sneakers and RUN to the attorneys office as this is where it is headed anyway. IMHO>>>>>>>>>>>>>>>>>>

 

[Sierrasparky]

If a GC were to place a stop payment on a check after your fulfillment of your obligations, it would be check fraud, criminally chargeable.
but on the same token, if you failed to send them the waver of lien after cashing the check, then then you have not fulfilled your obligations, they could pull you into court, and could cause you to have to refund the money and more if it causes a lost sale of the house, or of penalties impose by the lender for not closing the house on time.

I would stick to your guns as it seems suspicious that if they are intending to pay, would not send the check, because they have more to loose than you.
Think about it, if they were to try to take you to court, because you held up the sale of the house, or caused penalties, they would not have a leg to stand on in court, because the court would have to back you because they didn't pay. so it would be their fault for the lost sale or penalties.

so stand your ground, or offer a happy medium, and meet them halfway to there office.

I do not agree. with your comments. You don't need to give a unconditional release of lien if you don't have the money. I am sure the provides a reasonable time to provide a release of lein after payment has been made. A person that will not accept a conditional waiver and release of lien is just looking to screw with you. If you give them the full release of lein and have not been paid then you have a problem and good luck collecting.

 

[hurk27]

I do not agree. with your comments. You don't need to give a unconditional release of lien if you don't have the money. I am sure the provides a reasonable time to provide a release of lein after payment has been made. A person that will not accept a conditional waiver and release of lien is just looking to screw with you. If you give them the full release of lein and have not been paid then you have a problem and good luck collecting.

I supose your talking about this statement:

but on the same token, if you failed to send them the waver of lien after cashing the check, then then you have not fulfilled your obligations, they could pull you into court, and could cause you to have to refund the money and more if it causes a lost sale of the house, or of penalties impose by the lender for not closing the house on time.

It may have not been clear, but what it ment, is that if the job is compleated, and you have been paid in full, yes you have an obligation to provide a full waver of lien. and not doing so can cost you a bundle if it cause the sale of the home to fail.

 

[bradleyelectric]

Instead of running to pay a lawyer or the court, a phone call is cheaper. The first phone call is the GC and discuss wording for a partial lien that takes effect when the check clears. If that phone call is not fruitful the next calls are to the landlord and tenant. Neither 1 of them want to be tied up with liens. You don't have to fly off half cocked. Just try to work it out calmly with the parties involved before loosing money through the courts.