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Waiver of Lien for payment

Hi, Do I need to sign a waiver of lien to get a payment released to me? I am disputing the amount and they will not release payment unless the waiver is signed for the lower amount. Is there a way to dispute it and get payment less the disputed amount? This is for NYS DOT contract. I am the subcontractor. I am in New York.

1 reply

Mar 9, 2020

New York construction businesses aren't legally required to provide lien waivers in order to get paid. Though, if the contract specifically requires that a lien waiver must be provided, then that lien waiver must be provided before payment will be made. In either case, it's common for a customer to refuse to make payment unless a waiver is provided, so tensions could begin to run higher. Levelset discusses this tension about whether or not waivers are "required" here: Do I Have to Sign a Lien Waiver to Get Paid? Ultimately, the expectation that lien waivers will be exchanged is a common one. In a general sense, that's usually perfectly fine - submitting a mechanics lien waiver for payment should act just like a receipt. Of course, if there's a dispute over what will or should be paid, then exchanging waivers becomes a more complex situation. Because New York doesn't have statutory lien waiver rules, there's a ton of flexibility as to how they can be handled. So, a less-than-enthusiastic subcontractor may be able to issue lien waivers in a way that works for them. If further payment is expected on the job, then it might be a better idea to use a partial lien waiver than a final lien waiver. Or, putting disputed amounts into an "Exceptions" section on the waiver can show that certain lien rights aren't yet being waived for certain amounts. Further, if you want to condition the waiver so it's only effective after payment has been made, that's an easy fix too.

Additional lien waiver resources

With all of that being said, when submitting a lien waiver, it's important to be sure you aren't waiving more than what's intended. So, going through the language of the waiver and properly utilizing each section of the waiver should be high priority. For an in-depth discussion about the different types of lien waivers and when to use them, this article should be valuable: The Ultimate Guide to Lien Waivers in Construction (Meaning & Examples). For more information on New York's lien waiver rules, and to download free New York waiver templates, this resource should help: New York Lien Waivers Guide and FAQs.

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