How do I lien a payment bond?

7 days ago
State: Alabama

We worked on a project as a subcontractor and the GC has a payment bond. We cannot get a response from the GC as to payment status. How do we lien a payment bond? We are in the state of Alabama.

Senior Legal Associate Levelset

When making a claim against a payment bond, that claim is generally not considered a “lien” claim. Rather, they’re more generally referred to as bond claims. Rather than attaching to the underlying project property, like a lien would, bond claims are made directly against the bond.

If you’re working on a public works project and the contractor has secured a payment bond as required by the Alabama Little Miller Act. For private projects, a payment bond may be present, and claims against that bond would generally need to be made in the manner set out by that bond. So, obtaining a copy of that bond, if working on a private job, would be important to determine exactly how to make a claim against that bond.

Since payment bonds are much more common on Alabama public projects, let’s dive a little bit deeper on those.

In Alabama, claimants looking to make a claim against the (public) project’s payment bond must send a written notice of their claim before they can actually file suit. This claim must be sent to the surety at least 45 days before suit could be filed against the bond – and the deadline for a lawsuit against a public works payment bond is 1 year from project completion in Alabama. So, effectively, the deadline to send a bond claim to the surety is just about 10.5 months after project completion. Though, obviously, it’s not a good idea to push it close to the deadline, and making a claim earlier than later will generally help get payment talks going.

You can learn more about that process here: Alabama Bond Claim Overview.

Note, also, that merely threatening to make a bond claim can also be effective to speed payment talks along and help prevent the need for making a bond claim at all. For more on that idea: Do I Need to Send a Notice of Intent Before Making a Construction Bond Claim?

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