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If I sign an unconditional waiver without payment and they don't pay, are we on the hook?

Nevada

We have a contractor who will not send payment until I send an unconditional. I have explained that we will not do that as it waives our rights, but they said since they sent a picture of the check they plan on sending that it doesn't matter. I feel like it still does but at this point we are at a stale mate. They won't send without an unconditional and we will not send it without payment.

1 reply

Jan 18, 2022

Generally speaking, Nevada doesn't appear to block the waiver of lien rights before payment is made. So, if an unconditional waiver is signed and exchanged before payment is made, then lien rights may well be lost.

That being said, if payment is given in exchange for that unconditional waiver, and if the payment doesn't clear (like a bounced or canceled check), that waiver becomes void. In that case, lien rights would remain intact even if an unconditional waiver has already been given.

If a customer refuses to release payment until a waiver has been given, there are a few strategies that might help. For one, this situation is literally what conditional waivers are designed for. Once payment is made, a conditional waiver becomes just as binding as an unconditional one. Plus, if the contractor is particularly adamant, you can always submit an unconditional right after (or at the exact same time as) a check is received. 

What's more, it could be useful to remind the contractor that once payment is made, all lien rights are lost for the work that's being paid - that occurs instantaneously, regardless of whether any waiver is ever given. This is because lien rights only exist for work that's been done but hasn't been paid for. 

Finally, if it will make the customer feel better, you could even write out a simple one-page contract promising to submit an unconditional waiver the second a check is received prompting the waiver.

For a deep dive on Nevada waivers, here's a great resource: Nevada Lien Waivers Guide and FAQs.

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