Home>Levelset Community>Legal Help>Is it legal in the State of CA for a contract provision to state that a sub working under a general contractor "Agrees to keep the building free and clear of all claims or liens for labor and services"

Is it legal in the State of CA for a contract provision to state that a sub working under a general contractor "Agrees to keep the building free and clear of all claims or liens for labor and services"

We were a sub to a GC and signed an agreement. They never returned a signed copy to us. They are refusing to pay and instead are asserting our work was inferior and hired someone to tear it out and replace it. Did not give us any notice that they were doing this.

1 reply

Dec 10, 2018

I'm sorry to hear about that - everyone deserves to be paid what they're owed. In California, a "no lien clause" - that is, a clause in a contract that purports to waive lien rights before the work has even been undertaken - will not be valid to prohibit the filing of a mechanics lien. Further, California is very strict on how lien rights must be waived. In order to waive lien rights in California, the specific forms set out by the California Civil Code must be used. Potentially, an unconditional final lien waiver could be signed by a lien claimant, waiving their right to lien before even performing their work. But, unless one of the California statutory lien waivers was signed, lien rights are not waived in CA. Of course, it's worth noting that such a clause could have other effects - such as obligating a party to keep the project free and clear of liens by that party's subcontractors and suppliers (by making payments, bonding off a lien, or otherwise having any of their liens removed). You can learn more about California lien waivers at the following resources: (1) California Lien Waiver Forms & Guide, and (2) California Lien Waiver FAQs. Plus, these may also be helpful: California Lien and Notice FAQs and Can I File A Lien If My Workmanship Is In Dispute?.

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