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Should I add interest to the total amount on a NOCR?

4 months ago

Should I add interest and change order amounts to our NOCR or just the original contract amount?

Senior Legal Associate Levelset

Good question. Under § 53-057 of the Texas Property Code, which creates the Notice of Contractual Retainage requirements, “(c) The notice must generally state the existence of a requirement for retainage…” – but it doesn’t require an exact amount. Further, the remainder of § 53-057 doesn’t specify that the exact amount to be retained must be included, and it doesn’t require an extremely thorough outline of the exact terms of the retainage agreement. So, it seems as though including interest amounts in a Notice of Contractual Retainage would not be necessary. Though, adding that information presumably shouldn’t have any negative legal effect, either.

It is worth noting, however, that when actually making a lien claim, adding amounts that don’t directly relate to the work provided can result in an exaggerated claim. So, while including interest amounts in a notice might not be improper, when it comes down to a claim, itself, interest amounts could not be liened. Though, they can certainly be awarded by a court, if it comes to that.

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