Lien Waiver from GC

[Raj Kumar]

Hi There,

               I finished up a rehab and about to pay the final payment to general contractor. I want to make sure that I get the lien waiver with the corresponding sub contractors he used information in the lien waiver as contractor affidavit. But, the GC says that he will provide the lien waiver from his company including the language that all sub contractors are paid without mentioning the name of the sub contractors. 

                          When I asked him to include the subcontractor information in the lien waiver, he says that he has been doing the same way from past 20 years and he would not do that. How can I enforce him to provide the sub contractor details as specified in the lien waiver form. He also asks me to send the check in mail and then he will send the lien waiver in mail after the amount is cleared in the bank. what is the regular practice to get lien waivers from the GC's? How can enforce him to provide the sub contractor details ? He is adamant about not changing his way like providing sub contractor information.  Do I have to go through the route of mediation using attorney generals office?. Any ideas in proceeding in this situation is appreciated. 

http://www.nwmetro.ctic.com/UploadedDocuments/Form...

Thanks,

[Nick Noon]

@Raj Kumar

I work for a large GC in Boston.  This is on a bigger scale ($50MM projects), but I deal with partial and final lien waivers all the time.  Every month I produce a requisition to the owner for payment which is usually through an AIA G702 form.  When I submit the requisition to the owner, it will include all the partial lien waivers from my subs as well as mine.  We have a standard form we send out to all our subcontractors that basically says they are waiving their right to put a lien on the property if they are paid X amount of dollars.  We WILL NOT pay any subcontractor until they submit a partial lien waiver to us. 

Now, when it comes time time to close out the project, we require final lien waivers from all of subcontractors and we submit them to the owner along with ours.  How do we get our subcontractors to make sure they submit their final lien waivers?  One word:  Retainage.  You should be holding retainage on your GC.  You should check with your local laws on how much you can hold (In Massachusetts we are allowed to hold 10% retainage on all requisitions, or 5% retainage if the prime contract value is over $3MM).  So basically if the project was worth $100,000 and he has billed the entire contract out, you should still be holding $10,000 of his money.  Retainage is important.  It's the owner's way of making sure you get punch list completed, final lien waivers in, O&M manuals, etc.  

You're going to want to get lien waivers from the subcontractors so you know they can't put a lien on the property.  It's a single piece of paper from each sub where they fill their name in, put in the contract price, and have it notarized...pretty simple. 

So to answer your question, the standard practice is:  

1.  I submit a requisition with partial lien waivers

2. Owner pays me, less retainage

3. I requisition for final payment, send final lien waivers

4. Owner releases payment and retainage