Sub-Contractors Lein on house

[Edward Pulido]

I am in an interesting scenario where my contractor has not paid one of his subs. I received a letter from a sub making me aware of the situation and they are threatening to file a lien on the property. 

The situation gets interesting because although the property that this lien could be filed on is complete, and my contractor paid in full, I have him working on two other houses at the moment that he has not completed and I have not paid him in full. I have carefully documented all payments, but never received a release of lein from him or his subs. I can probably get a release of lein from him, but that won't protect me from his subs trying to collect.

 I don't believe I have any real legal recourse to withhold the money from him because we are now on a separate project. I am pretty sure he doesn't have enough money to pay the sub at this time.

Does anyone have any ideas on how to move forward?

Thanks!