How can I file a stop notice on a project that i have not gotten paid on?
1 reply
Mar 24, 2020
If you're referring to sending a stop payment notice to freeze the project funds - Nevada doesn't actually have stop payment notice provisions like California and Arizona do. So, filing a stop notice to force payment isn't really an option in Nevada.
However, in the context of tenant improvements, a Nevada contractor can provide a stop work notice in order to suspend work on the job until the tenant in charge of the project provides some form of security for payment (like a payment bond), pursuant to NRS § 108.2403.
Payment recovery options for Nevada contractors, subs, and suppliers
Even if stop payment notices aren't really an option, there are a number of payment tools that can help to recover payment. Let's break down a few options.
Invoice reminders
For one, something as simple as a reminder may lead to payment. Invoice reminders do just that - they remind customers of unpaid invoices and request that payment be made. And, sometimes, that little nudge is all that's needed.
Demand letters
Taking things up a notch by sending a payment demand letter can force payment, too. A demand letter will usually demand payment by including specific legal threats that will be undertaken if payment isn't made by some specific deadline. Nobody likes a lawsuit or payment dispute, so threats could lead to faster payment to avoid a more serious issue.
Notice of Intent
Sending a Notice of Intent to Lien or a Notice of Intent to Make a Bond Claim can be a powerful tool for getting paid.
No owner wants their property to be liened, so for private projects, a Notice of Intent to Lien will let the owner, your customer, and anyone else you send the notice to aware of the issue. It will let them know that if payment isn't made and made soon, then a lien will be filed. Plus, this will actually be a required part of the mechanics lien process on residential projects. So, it may be necessary to fully preserve more serious recovery tools.
For public projects, letting the GC know you'll file a bond claim if you aren't paid will have a similar effect. No contractor wants to have to jump through hoops with their surety, and they won't want to deal with the litigation that may occur as a result of the claim. So, threatening a bond claim could be enough to get things moving in the right direction.
Finally, keep in mind that anytime a customer fails to pay what's owed, legal claims will typically be on the table in some form or fashion. Claims like breach of contract or claims under the Nevada prompt payment laws could be on the table, among other potential claims. Of course, consulting with a Nevada construction attorney could be helpful for deciding what claims might be best used to get paid.