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ONCE A CHECK HAS BEEN REMITTED AT AN AMOUNT LESS THAN THE INVOICE. CAN CHECK BE CASHED AND A LIEN BE PUT ON THE BALANC

Ohio

I SUBMITTED A INVOICE TO THE INSURANCE COMPANY AND THE ADJUSTER CUT OUT $15000. NEED TO KNOW IF I CAN PLACE A LIEN ON THE AMOUNT NOT PAID. WHAT STEPS SHOULD I TAKE. IF I CASH THE CHECK CAN I STILL GO AFTER THE REMAINING BALANCE?

1 reply

Mar 8, 2021

If the check states that it's for "Final Payment" or otherwise indicates something similar, then it'd be wise to be extremely cautious about potentially cashing the check. Potentially, cashing such a check could serve as an agreement to settle the account for less and could end up cancelling potential lien rights. Levelset's CEO Scott Wolfe discusses that in this article: Are Checks with “Payment in Full” in Memo Line Legally Binding? Do They Affect Mechanics Lien Rights?

I'm not an Ohio attorney, but it does appear that there's some precedent there for a "final payment" check serving as a final settlement of a claim. You can read the case here: M & T Electric Co., Inc. v. LLLJ, Ltd. (PDF). Additionally, it looks like this blog post from Thrasher, Dinsmore, & Dolan discusses the issue in great detail: Accord and Satisfaction – Effectiveness of Writing “Payment in Full” on a Check.

If you'd like some more specific assessment from an Ohio attorney, one of these lawyers may be able to help: Top Ohio Construction Lawyers.

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