Home>Levelset Community>Legal Help>I have General Contractor that has not made final payment on a public project in Massachusetts after we agreed to the final disbursement amount. The time frame has been over 90 days. How do I proceed with collecting my final payment of $ 2,800 ?

I have General Contractor that has not made final payment on a public project in Massachusetts after we agreed to the final disbursement amount. The time frame has been over 90 days. How do I proceed with collecting my final payment of $ 2,800 ?

My company is a material supplier. There was a disagreement over the intent of the drawings, approved submittals, and the job site conditions had changed. They expected our firm to make field modifications to the door frames at no additional cost. We had an approved submittal stating what size the frames were to be. We made the modifications, and they back charged our firm for the amount of additional labor required by their firm to install the frames and hardware. We were only a material supplier. We finally agreed after six months to accept a back charge to a least get part of our retainer returned to us. We signed the change order to allow the final retainer to be paid. After the agreement it has been sixty days and we still have not seen the retainer.

1 reply

Sep 27, 2018

I'm sorry to hear about that. Being bullied by an up-the-chain party happens all too often in this industry. When working on public jobs, the ability to leverage a mechanics lien to compel payment is not present - public property cannot be liened. However, payment bond claims go a long way to compel payment, and they're available as a sort-of substitute for liens on public jobs. Instead of securing payment with a lien on the project property, a bond claim secures the right to payment against the contractor's payment bond (more on that here: What Is A Surety Bond Claim?). In Massachusetts, depending on who hired the supplier, most material suppliers are entitled to utilize a bond claim to recover payment. Those who furnish labor and/or materials to the GC or to a 1st tier subcontractor are explicitly covered. It's unclear if those contracting with a 2nd tier subcontractor would be entitled to make a payment bond, and if a supplier is supplying material to another supplier, they will generally not be entitled to a bond claim. There are a number of specifics that go into making a payment bond claim (we talk about those here), but perhaps the most important is the deadline. In Massachusetts, a payment bond claim must be received by the general contractor within 65 days of the claimant’s last furnishing of labor and/or materials to the project. Even if this deadline is missed, sending a document like a Notice of Intent to Make Bond Claim could still be effective - it acts as a warning that or demand for payment, and it states that if a payment isn't made soon, a bond claim will be filed. Finally, if recovery on the bond (or the threat of a bond claim) doesn't work or isn't an option, there are other potential options for recovery. Specifically, making a claim under Massachusetts' prompt payment laws (more on those here) could be effective, and recovery under these laws also entitles a claimant to interest payments. Because this would entail legal action, sending a demand like a Notice of Intent to Make Prompt Payment Claim could help to recover without the need for an actual suit. Further, filing a lawsuit for breach of contract or under some other legal theory could also be effective - and threatening to file suit will often go a long way. If utilizing a payment bond claim isn't an option, it might also be wise to consult a local construction law attorney. They will be able to thoroughly evaluate your situation (including all documentation and communications) to help advise on a path toward recovery.

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