Home>Levelset Community>Legal Help>In PA I have a GC that owes us over $750,000 total for work completed over 6 months ago and refuses to pay for work performed unless we give up almost $300,000 for work we performed legitimately and correctly with proper documentation as a site contractor.(Bogus reasons) and they are trying to starve us out by taking there good old time communicating. We have placed the lien on the property about 30 days ago (hotel) to protect our rights but no movement is occurring on payment.. . What is my next options to take to apply pressure to get paid and not have to concede to a large discount?
In PA I have a GC that owes us over $750,000 total for work completed over 6 months ago and refuses to pay for work performed unless we give up almost $300,000 for work we performed legitimately and correctly with proper documentation as a site contractor.(Bogus reasons) and they are trying to starve us out by taking there good old time communicating. We have placed the lien on the property about 30 days ago (hotel) to protect our rights but no movement is occurring on payment.. . What is my next options to take to apply pressure to get paid and not have to concede to a large discount?
We are a midsize civil contractor being squeezed by a huge GC that is not playing fairly. The GC has been paid over 90 days ago from the owner but is holding our money .
1 reply
Jan 4, 2019
Delays in payment, or other abusive payment issues can be very frustrating - especially if you know that the party supposed to pay you has already been paid.
In Pennsylvania, in order to have a valid mechanics lien certain notices must be sent. Parties without a contract directly with the owner must send a notice of intent to lien at least 30 days prior to filing the lien itself; and, if the project as a whole was greater than $1.5 million, if a Notice of Commencement was filed in the State Construction Registry, a Notice Furnishing must be filed through the registry within 45 days of first furnishing labor and materials.
Once a lien has been filed, no later than 6 months after last furnishing labor or materials to the project, and it has not resulted in payment, an action to enforce the lien must be initiated within 2 years of the lien's filing. An action to enforce is a lawsuit to enforce the lien ultimately through foreclosure of the property itself. Generally, successful lien claimants in an enforcement action are awarded costs and attorneys' fees, as well.
In addition to filing suit to enforce the lien, there may be other causes of action that could be pursued, as well. Breach of contract, being one of the most obvious possibilities.
Further, Pennsylvania has "prompt payment" statutes to ensure that payments are not unnecessarily or inappropriately withheld. In Pennsylvania, payment from a direct/prime/GC is due within 10 days after the prime contractor receives payment from above or an invoice from below. If payment is late, interest can begin to accrue, and further, if the board of Claims or an arbitrator determines that amounts were withheld in bad faith, an additional penalty of 1% per month on the wrongfully withheld amounts may be assessed.
Payments are allowed to be withheld for deficiencies according to the contract between the parties, so if there are workmanship disputes, it may result in slower payment. If payments are withheld, however, the party to be paid must be notified within 7 days of the paying party’s receipt of the invoice.