Virginia Lien Waiver Overview
Virginia Lien Waiver Rules
- Rules At A Glance
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No Specific Form
Virginia does not provide or require specific forms for lien waivers.
Notarization Not Required
Virginia lien waivers do not need to be notarized in order to be effective, and they gain no benefit from notarization.
Cannot Waive Rights in Contract
Sub-tier parties can not waive lien rights by contract in advance of furnishing labor or materials. Note, however, that a direct contractor may waive lien rights at any time.
Can Waive Rights Before Payment
In Virginia, a direct contractor may waive lien rights at any time, and a sub-tier contractor or supplier may waive lien rights after s/he furnishes labor or material to the project.
The rules surrounding Virginia lien waivers were modified in 2016. While there has been plenty of time for construction participants in Virginia to catch up with the changes, it is still possible to find Virginia construction contracts with profited “no-lien” clauses.
Prior to 2016, Virginia was one of the very few states that explicitly allowed lien rights for all parties to be waived prior to furnishing labor or material to the project by including an advance lien waiver in the contract itself. After the 2016 modification of the law, however, it became impossible for a “subcontractor, lower-tier subcontractor, or material supplier” to waive lien rights prior to furnishing labor or materials to the project.
This prohibition brought Virginia in line with most other states by disallowing the waiver of lien or bond claim rights prior to furnishing work, for most parties. It is worth noting, however, that direct contractors are not prohibited from waiving lien rights in contract prior to work. Direct contractors would rarely have a clause limiting their ability to use payment security like liens and bond claims in their contract, but if such a clause was included it would likely be enforceable. While the statute specifically mentions “material suppliers” as unable to waive lien rights prospectively through contract, it is worth being careful – a material supplier who supplies materials directly to the owner may not want to test their ability to waive lien rights in contract, despite the prohibition, since the clause seems specifically targeted to sub-tier parties.
It is also worth noting that the prohibition against advance lien waivers is limited to waiving lien rights in the contract prior to work. There is specifically no prohibition on waiving lien rights after the work is performed or the materials are furnished, but before payment is made. In fact, that was specifically modified in the amendment so that such pre-payment waivers were allowed. Finally, whether clauses like “pay-when-paid” or “pay-if-paid” are prohibited or potentially work to waive lien rights is contentious and not entirely well-decided.