Detailed Review and Tracking of Prelim Notices and Releases
I work for a construction management firm (not a general contractor), and we approach the preliminary notices and lien releases from the property owner/client’s perspective.
Our policy is pretty simple:
– Track receipt of prelim notices
– For pay apps, track conditional releases for current and final/progress for prior releases from general, subs, suppliers, etc.
– For final pay app, collect unconditional/final from general, subs, suppliers
– We have a form and policy to track individual prelims and releases
The problem is in the detail of tracking the prelims and releases. Here are some examples/questions we have:
– We don’t often get copies of all of the prelims, so we don’t necessarily know who to collect releases from. How should we manage this?
– Amount of release – we try to match it to the pay app schedule of values, but this often doesn’t tie. Should we forget the amount and worry only about the date on the release?
– Should the total of all releases match the total of the pay app? Or specifically, should the subcontractor portion of the pay app equal the total of all subcontractor releases? What if they don’t match?
– How do we know we’ve gotten releases from all subs and suppliers? We request subcontractor lists from the GC, but it doesn’t normally include the 2nd tier or suppliers.
– How do we manage risk and protect our clients best? Is it okay to get 80% of releases for progress payments?
– What if the conditional release and unconditional releases don’t match? For example, either the amount has changed, or the Through Date is different.
– If the Through Date on the unconditional release is later than the Through Date of the conditional release, is this okay to accept? What if the Through Date on the unconditional release is earlier than the Through Date of the conditional release?
– How do we handle self-performed work by the GC?
Thank you in advance for your help!