Generally, all subcontractors and suppliers with or without a direct contract with the prime contractor are entitled to make a bond claim on non-payment provided the labor and/or materials furnished was actually used in or incorporated into the project. Suppliers to suppliers are not generally protected, but if the supplier to whom materials were furnished can be considered a subcontractor by undertaking a large and definable part of the project, a supplier to that party may be protected.
Note that Nebraska’s Construction Prompt Pay Act provides that a subcontractor is entitled to interest if not paid within 10 days of the date on which the general is paid. This applies to contracts entered into political subdivisions of the state, but not the state itself.
When is the deadline to initiate suit, or, how long is my Nebraska Bond Claim effective?
An action to enforce a bond claim must be initiated more than 90 days after the claimant’s last furnishing of labor and/or materials, but no more than 1 year after the date of final settlement of the principal contract.
The only statutorily required information is the amount claimed and the name of the party for whom work or materials were supplied. However, it may be advisable to also contain some identification of the project and a description of the labor and/or materials provided.
Nebraska does not have statutory lien waiver forms, and therefore, you can use any lien waiver forms. Since lien waivers are unregulated, be careful when reviewing and signing lien waivers. See this article: Should You Sign That Lien Waiver?.
Nebraska state law allows contractors and suppliers to waive their lien rights at anytime, and therefore, contractors and suppliers are technically legally allowed to waive their lien rights even within their contract before starting to do any work.You can learn more about such “no lien clauses” at this article: Where Can You Waive Your Lien Rights Before Payment?
Need to file a Nebraska mechanics lien? File your mechanics lien with Levelset, the lien experts quickly and easily. Or you can follow the 3 steps below to file a lien yourself with Levelset's free information.
When you perform work on a state construction project in Nebraska, and are not paid, you can file a “lien” against the project pursuant to Nebraska’s Little Miller Act. Since the claim is not against the state or county’s actual property, but instead against a posted bond, the claim is not really called a “lien” but is more frequently referred to as a “bond claim” or “little miller act claim.”
Nebraska’s Little Miller Act is found in Nebraska Revised Statutes Chapter 52, Liens, and is reproduced below.
Nebraska Little Miller Act
52-118 Public building construction; bond required for benefit of laborers, mechanics, and suppliers; exception.
(1) Except as provided in subsection (2) of this section, it shall be the duty of the State of Nebraska or any department or agency thereof, the county boards, the contracting board of all cities, villages, and school districts, all public boards empowered by law to enter into a contract for the erecting, furnishing, or repairing of any public building, bridge, highway, or other public structure or improvement, and any officer or officers so empowered by law to enter into such contract, to which the general provisions of the mechanics’ lien laws do not apply and when the mechanics and laborers have no lien to secure the payment of their wages and suppliers who furnish material and who lease equipment for such work have no lien to secure payment therefor, to take from the person as defined in section 49-801 to whom the contract is awarded a payment bond or bonds in a sum not less than the contract price with a corporate surety company and agent selected by such person, conditioned for the payment of all laborers and mechanics for labor that is performed and for the payment for material and equipment rental which is actually used or rented in the erecting, furnishing, or repairing of the public structure or improvement or in performing the contract.
(2) The labor and material payment bond or bonds referred to in subsection (1) of this section shall not be required for (a) any project bid or proposed by the State of Nebraska or any department or agency thereof which has a total cost of fifteen thousand dollars or less or (b) any project bid or proposed by any county board, contracting board of any city, village, or school district, public board, or officer referred to in subsection (1) of this section which has a total cost of ten thousand dollars or less unless the state, department, agency, board, or officer includes a bond requirement in the specifications for the project.
(3) The bond or bonds referred to in subsection (1) of this section shall be to, filed with, approved by, and safely kept by the State of Nebraska, department or agency thereof, officer or officers, or board awarding the contract. No contract referred to in subsection (1) of this section shall be entered into by the State of Nebraska, department or agency thereof, officer or officers, or board referred to in subsection (1) of this section until the bond or bonds referred to in subsection (1) of this section has been so made, filed, and approved.
(4) The bond or bonds referred to in subsection (1) of this section may be taken from the person to whom the contract is awarded by the owner and owner’s representative jointly as determined by the owner. The corporate surety company referred to in subsection (1) of this section shall have a rating acceptable to the owner as the owner may require.
52-118.01 Public building construction; bond; claim for unpaid labor or material; action; procedure.
Every person who has furnished labor or material in the prosecution of the work provided for in the contract set out in subsection (1) of section 52-118, in respect of which a bond is or bonds are furnished under such section, and who has not been paid in full therefor before the expiration of a period of ninety days after the day on which the last of the labor was done or performed by him or her or material was furnished or supplied by him or her for which such claim is made shall have the right to sue on such bond or bonds for the amount or the balance thereof unpaid at the time of the institution of such suit and to prosecute the action to final execution and judgment for the sum or sums justly due him or her. Any person having a direct contractual relationship with a subcontractor but no contractual relationship, express or implied, with the contractor furnishing such bond or bonds shall have a right of action upon the bond or bonds upon giving written notice to the contractor within four months from the date on which such person did or performed the last of the labor or furnished or supplied the last of the material for which such claim is made, stating with substantial accuracy the amount claimed and the name of the party to whom the material was furnished or supplied or for whom the labor was done or performed. Such notice shall be served by mailing the same by registered or certified mail, postage prepaid, in an envelope addressed to the contractor at any place he or she maintains an office or conducts his or her business or his or her residence or in any other manner in which a notice may be served.
52-118.02 Public building construction; bond; action; limitation; person to bring suit; rental equipment, defined.
Every suit instituted under section 52-118.01 shall be brought by any person entitled to the benefit of this action, but no such suit shall be commenced after the expiration of one year after the date of final settlement of the principal contract. The action shall be in the name of the party claiming the benefits of this action.
For the purposes of subsection (1) of section 52-118, equipment which is rented for a project covered by such subsection under a lease with an option to purchase shall be considered to be equipment rented under a straight lease agreement not to exceed the reasonable rental value of the equipment during the period such equipment is actually used on such project and unless and until the option to purchase is validly exercised under the contract.
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