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Waiver with wrong verbiage

Hello, I am new to lien waivers and I discovered an error on a waiver that was sent to a customer. It’s a Chicago title partial waiver. The top half of the waiver has final waiver language. However it’s dated only through what we have been paid. The waiver says it’s partial at the top but the verbiage is that of a final. How big of a deal is this?

1 reply

Mar 18, 2020

Illinois is not one of the 12 states with statutory lien waiver forms, so parties can use any lien waiver template they want, provided the waiver is provided after performing work or providing material to the project. Since a lien waiver is like a little contract in which a party agrees to give up a certain amount of lien rights in consideration of the corresponding payment (or promise of payment) there are certain threshold requirements that the waiver actually define the amount waived or the through date through which the waiver is applicable. Whether mismatched language on a waiver is a big deal depends on the language itself. If the confusion is such that it is unclear what is being waived, it could throw the validity of the wavier in question - or at least provide fodder for a dispute related to the amount and effectiveness of the waiver. While the interpretation of the waiver is only an issue of other payments are not forthcoming, the problem is that it could provide grounds for a dispute, and tie up time and energy in a fight that otherwise wouldn't need to be had, no matter what amount the waiver is ultimately determined to be validly waiving. Another important part of the evaluation is whether the waiver is a "conditional waiver" or an "unconditional waiver." Unconditional waivers are effective immediately upon signing, irrespective of payment - the problem here would be that if the waiver was an unconditional final waiver, the party is acknowledging that no further amounts are due. A conditional waiver is only ultimately effective when the payment subject to the waiver is actually made. With respect to a specific waiver, the answer of whether the language is a big deal is, frustratingly, "not necessarily, but it could be."

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