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Colorado Subcontractor Lien Waiver Form

Hello, I live in CO and recently hired a GC to finish off my basement. He will be using subcontractors for some of the work. I want to make sure I protect myself from possible lien filing in the event the GC does not pay his subs. The agreement we entered was that work would be performed over a 6 week period. I would pay the GC directly in the amount of 1/3 up front (this payment I have already made), 1/3 at the midway point (this payment that has not been made yet), and the final 1/3 upon completion of the job (this payment also not made yet). I'm unsure which lien waiver to have my GC sign. It appears that Partial Conditional would make the most sense since I am making payments throughout the job instead of one final payment, and some of those payments have not been made yet. I'm unsure how this affects the first payment that I already made, though. Also, Colorado does not have a state mandated form to use, so can I use another state (such as California?) as a starting point and modify it? Any guidance would be appreciated. Thank you!

1 reply

Aug 2, 2018

There are lots of questions surrounding waivers, as they are both very important and often misunderstood. Waivers can generally be broken down into two main types, each with two sub-types. First, there are Conditional Waivers and Unconditional Waivers. And second, each of these can be given given pursuant to a final payment or a progress payment.

Unconditional waivers should be used when the payment (either a progress payment or a final payment) has already been made.

Conditional waivers can be provided prior to payment being made, as they are not effective until some condition (generally the receipt of payment) is met.

So, in the case where there has been one payment completed, an Unconditional Partial/Progress waiver can be used. For the second payment, a conditional progress waiver can be requested prior to payment being made, and (if desired) an unconditional progress waiver could be obtained after the payment is made. Finally, for the last payment the same pattern can be followed, only using "final" waivers.

Note, however, that obtaining a waiver from your GC only specifically protects you from liens filed by the GC. Other parties may still file liens - in order to protect against potential lien claims from other parties down the payment chain, a waiver should be obtained from each sub-tier party. A request can be made that the GC provide you a waiver from each sub-tier party prior to payment. No party is allowed to waive lien rights for any other party.

To the extent that the property is a single family residence, a property owner does, however, have an affirmative defense to any action to enforce a lien if the GC has been paid in full.

Finally, as you are correct that Colorado doesn't require any specific or particular waiver form, any document can be used. Using a state like California's as templates is a perfectly fine way to go about it.

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