Exchanging lien waivers on a construction project can be scary. More than just a piece of paper, you’re actually giving up the right to file a mechanics lien. What happens if you sign a lien waiver only to find out later that you unintentionally signed away more than you bargained for?
In states like Arizona, though, lien waivers must follow a specific statutory form with exact language that is specified by law. This means that the risk of dangerous language lurking in a waiver is all but eliminated. Therefore, while statutory eliminate some of the risks, it’s still important for contractors to use the correct waiver for the correct payment situation.
Like many other states, Arizona’s lien law prescribes 4 statutory lien waivers, and this post will take a look at 1 of those 4: Arizona’s Conditional Lien Waiver for a Progress Payment.
Guide to Arizona’s Conditional Lien Waiver for Progress Payments
Parents aren’t supposed to have favorite children, but it’s ok for us to have a favorite lien waiver form – and ours is the conditional lien waiver for progress payments. Why? Because this is the most common form to use in the case of progress payments and is the SAFEST CHOICE. Therefore, if you’re unsure about which form to use, or if you just want to be safe, then choose and use THIS LIEN WAIVER DOCUMENT.
But, favorites aside, that doesn’t mean it’s the right form for every situation!
This waiver is conditional meaning that it is made in anticipation/exchange for payment. Or in other words, getting paid is the “condition.” If that payment isn’t made, then the lien rights aren’t waived.
If you need a waiver to be exchanged for a final payment, a final waiver may be in order. If the progress payment has already been made and received, some parties may prefer to utilize an unconditional lien waiver for progress payments. The bottom line is that whichever lien waiver form you use must match the payment situation you’re in.
Free Form Template Download: Arizona Conditional Waiver for a Progress Payment
Keep in mind: There are 4 different lien waiver forms that may be used in Arizona, depending on the situation. For help with the four different types of lien waivers, you should download this guide:
How to Fill Out the Arizona Conditional Lien Waiver — Progress Payment Form
Let’s take a look at the actual form.
>Project. Which project is payment being waived on? Identify it with the project’s address
>Job No. Is there a job identification number or contract number? If a job name or nickname is present, that would be helpful too.
>Maker of Check. This waiver is being exchanged for a check – who’s the maker of that check? Or, “Who’s making the payment?”
>Amount of Check $______. Easy! What’s the amount of that check we just referenced?
>Payee or Payees of Check. Who’s the party receiving payment? Who’s submitting this waiver in exchange for a check?
>Owner. Who owns the property where this project took place? Ownership can get tricky – especially when condominiums are involved or when the project structure itself is complicated. Bottom line — finding the correct owner might be more difficult than you might think, so be careful!
>Job Description and/or Location. On mechanics liens, this portion can get pretty strict. Often, a legal property description is needed. This is not the case with waivers! A project address is probably fine here – but, as always, be as precise as possible.
>Person with Whom Undersigned Contracted. Who did the party signing this waiver contract with? Who hired them (or, who hired you)?
>Date. Careful! This is a progress lien waiver. That means that lien rights are waived through a certain date, rather than through the end of the project. That means it’s important to get this date right. Lien rights will be waived for any work performed prior to the date entered here.
>Dated. This date’s easier – what’s the date on which this waiver is signed?
>Company Name. This one’s easy, too! Who’s waiving their lien rights? Be sure to get the entity name exactly correct, and be sure to include “LLC” or “Inc.” if it’s applicable.
>By. Time to sign this lien waiver. An authorized representative of the company waiving lien rights should sign.
>Title. What’s the title of the person signing the lien waiver?
REMEMBER — If you are unsure which of the 4 possible lien waiver forms you should use, then you should use this form, the Conditional Waiver and Release on Progress Payment form. It is the safest choice of the four.