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Contractor asking sub to sign unconditional lien before partial payment is that legal

I am a subcontractor and having trouble receiving payment from contractor he won't release payment unless i sign a unconditional lien and he only wants to pay half of what he owes until he inspects work but send pics already of work completion we live in Texas is that legal?

2 replies

May 24, 2020

Generally, the law prohibits requiring you to sign an unconditional waiver if you haven't been paid the consideration shown in the waiver. You should ask the GC to use a conditional waiver form. Also, it is problematical to release a lien for partial payment, since you are being asked to waive your rights through a particular date. If the GC won't use a conditional waiver form, you should consult an attorney to ensure that your rights are protected.

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May 26, 2020

Hello, Great question. Do not sign an unconditional lien waiver until after you have received payment. You can sign a conditional lien waiver for the 50% the contractor is going to pay, or sign the unconditional lien waiver for whatever amount you receive after the payment clears. You would only be releasing your right to lien for the 50% you have paid. However, the contractor cannot withhold payment until you sign the unconditional waiver or any amount. This could result in you never receiving payment if you sign the unconditional waiver first. You should still preserve your lien rights and file your lien while working out either payment or a settlement. Upon full payment of the lien, the law requires you to release your lien within 10 days so the contractor will ultimately get the release he desires. Thanks, Kelly Stamy Associate Attorney Tel: (713) 715-7334 www.TheCromeensLawFirm.com Privileged Attorney-Client Communication and/or Attorney Work Product: The above message and attachments, if any, are confidential and may be protected by the attorney/client privilege and/or attorney work product. The unauthorized disclosure, use, dissemination, or copying of this e-mail, or any information it contains, by anyone other than the intended recipient, is prohibited. If you are not the named recipient or have otherwise received this communication in error, delete it immediately and notify the sender at the office number listed above or by return email.

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