Conditional releases are supposed to condition the release of lien rights on actual receipt of payment. In general, documents should be dated on the day they are signed, but lien rights should only be released up to the date of the payment application that is being paid on, which is usually a date 30 days prior, or more. So, for example, if you are signing a lien release today (April 23) for your March pay application which was for work performed through March 30, the lien release can have today's date as the date of issuance, but should only release lien rights for work performed through March 30 - conditioned upon receipt of the payment being contemplated.
While on the topic of lien releases, be sure you are never releasing unpaid retention, and that you are reserving claims and not releasing lien rights with regard to any pending change order or claim for which notice was previously submitted. I provide my clients with a stamp (both physical and electronic) to stamp onto every lien release that provides something as follows:
"Notwithstanding anything herein to the contrary, this waiver and release does not release unpaid retention, pending change orders, submitted claims or notice of any claim or increased cost heretofore provided, and work performed since the last payment application period."
Disclaimer: This communication does not constitute legal advice, is not an engagement for the provision of legal services, is not a consultation, and does not form an attorney-client relationship between Katz Law, LLC and yourself or any other person or entity. In all cases, any particular outcome or resSee More...See More...