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Revising Conditional Progress Releases

Hi, We sent our customer (customer is a GC) an invoice for $90k along with a Conditional Progress Release - this is for a public high school. The customer states that the school only approved to pay $38k of the $90k and the customer is asking us to revise the Conditional Progress Release to the $38k. I worry we will lose our lien rights if we revised the Conditional Progress Release. Is this true?

1 reply

Mar 10, 2020

The through dates and amounts on California mechanics lien waivers are very important. If all work for the relevant period wasn't paid, then indicating you've been paid in full up to that through date - or indicating that a lesser amount is owed - could certainly make payment recovery an uphill battle. With that being said, as laid out by California Civil Code § 8132, a conditional progress waiver states that it won't affect "Extras for which the claimant has not received payment." So, there's likely a strong argument that unanticipated extras don't necessarily need to be featured on a progress waiver to be protected. Further, a subcontractor could also identify certain work in the Exceptions section so that it won't be waived - and that might be an option for making a lien waiver amount match up with a customer's expectations. But, at the end of the day, appeasing a customer should almost always fall behind preserving your own right to payment on the list of priorities. And, subcontractors should do what's necessary to have their lien waivers accurately reflect the payment status of the project.

Additional resources on California mechanics lien waivers

For more information on California mechanics lien waivers, these articles should be valuable: (1) California Conditional Lien Waiver and Release on Progress Payment (Form & Guide); (2) The Ultimate Guide to Lien Waivers in Construction (Meaning & Examples); and (3) California Lien Waivers Guide and FAQs.

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