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Home>Levelset Community>Legal Help>we are a manufacturer and supplier of windows in NY. we have a contract with an installer in NY for a PUBLIC PROJECT jobsite in NY. they paid 50% in deposit. now we are ready to ship the windows but they are refusing delivery. can we do a bond claim to get the remaining 50% due? or no because we have not shipped the windows?

we are a manufacturer and supplier of windows in NY. we have a contract with an installer in NY for a PUBLIC PROJECT jobsite in NY. they paid 50% in deposit. now we are ready to ship the windows but they are refusing delivery. can we do a bond claim to get the remaining 50% due? or no because we have not shipped the windows?

New YorkBond ClaimsRight to Lien

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1 reply

Mar 4, 2019
That's a great question, and I'm sorry to hear that this job isn't going as planned. First, when materials are contracted but not actually delivered and/or installed, generally, utilizing a lien or bond claim might not be the most appropriate course of action. Often, those materials will be readily available use in some other project when no delivery or installment has taken place - so a material supplier might not be suffering the same harm some other contractor, sub, or supplier does when they furnish labor or materials and then that labor or materials can no longer be recovered. However, when materials are specifically fabricated for a job and not easily used elsewhere, the calculation tends to be different. In those situations, companies who specially fabricate materials for a specific job might be entitled to lien or bond rights regardless of whether the materials are actually delivered or installed. Again, this is because, unlike a supplier of standard materials, these materials are much harder (or even impossible) to repurpose and resell for another job. In New York specifically, the New York Little Miller Act doesn't elaborate much on when materials are considered "furnished". However, the New York lien statute does state that mechanics lien rights arise for those parties who specially fabricate materials even where those materials have not been incorporated into the project under § 3 of the New York lien statute ("Within the meaning of the provisions of this chapter, materials actually manufactured for but not delivered to the real property, shall also be deemed to be materials furnished.") What's more, under § 5 of the New York lien statute, when work is being performed on a public improvement, the party furnishing labor or materials will have a lien on the funds for the project. So, in summary, under New York's Little Miller Act, it's unclear whether a party who manufactures but does not deliver or install specially fabricated materials will have the right to make a claim on the project's bond (but in many cases, such a claim would be appropriate). However, for a lien on funds for a New York public improvement, materials manufactured but not delivered are protected by the right to lien against funds. But also - where materials can easily be repurposed and resold for some other job, it might be hard for a claimant to argue that they're entitled to lien or bond for materials which are not actually delivered to the job site and installed. For more on both New York bond claims and liens on funds, this resource should be valuable: New York Public Project Payment FAQs.
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