Home>Levelset Community>Legal Help>Is it required; waiver for second tier sub (sub-sub) reference the GC?

Is it required; waiver for second tier sub (sub-sub) reference the GC?

We are a GC, and I want unconditional final waivers between the second tier sub and the first tier sub. On the waiver, it doesn't need to make reference to the GC, but just the job/project, and the second tier waiving its rights against the general, owner and general contractors bonding company. Correct? For clarity: We want to be sure our template form is correct, the one we are giving a first tier sub to utilize with their second tier sub. We are a GC, and I want unconditional final waivers between the second tier sub and the first tier sub. On the waiver, it doesn't need to make reference to the GC, but just the job/project, and the second tier waiving its rights against the general, owner and general contractors bonding company. Correct? We work in multiple states.

1 reply

Jan 22, 2020

Generally, that sounds about right. Mechanics lien rights arise in the property, not against any individual or business. So, each party who's accumulated lien rights (like a sub-subcontractor) really only needs to waive their own personal lien right against the property in order for that waiver to be effective. And, it's usually not necessary to specifically reference every other party on the project. As hinted at in your question above, it's also common to include a waiver of rights beyond just liens - like the right to certain legal claims against others on the project. Ultimately, though, as long as waivers are being properly exchanged for payment, waiving the right to make claims - be that lien claims or legal claims - should be effective. What's more, if payment is actually being made, then those rights wouldn't exist anyway. With the above being said, it's a bad idea to try and stuff lien waivers with too much risk-shifting language, though - particularly before payment is received by the party submitting the waiver. For further discussion on waivers: (1) The Ultimate Guide to Lien Waivers in Construction (Meaning & Examples); and (2) How To Handle Requesting & Tracking Lien Waivers.

Some states have statutory lien waivers

You mentioned that you work in multiple states, so keep in mind that some states have statutory lien waiver forms which must be used. Otherwise, the waiver might not be worth the paper it's printed on. You can learn more about those states and forms here: Lien Waivers: The 12 States With Required Forms.

Free, downloadable lien waiver templates for every state

Finally, note that Levelset has free lien waiver templates available for download in every state. You can start by going here, to the Illinois Lien Waivers Guide and FAQs and scrolling down to the "Free Illinois Lien Waivers Forms & Templates" section. And, for other states, you can select the "Choose another state" toolbar on the right-hand side near the top of the page.

0 people found this helpful

Helpful