Tennessee Demand for Reasonable Assurances form

Tennessee’s Demand for Reasonable Assurances form may be used on private construction projects by prime contractors and remote contractors to request an assurance that the property owner is able to make payments.

Under Tennessee’s Prompt Pay Act governing private construction, unpaid contractors have the right to demand “reasonable assurances” from the property owner that they have “made financial arrangements sufficient to fulfill its obligation to make all payments in accordance with the written contract or setting forth adequate legal reasons for their failure to make payment.”

In response, the property owner must provide either:

1. Reasonable evidence they’ll be able to fulfill their obligations
2. Adequate legal reasons for their failure to make payment

The Tennessee Demand for Reasonable Assurances can be sent alone or included with another demand letter or notice, like the Prompt Payment Notice of Intent form.

The Tennessee General Assembly passed the bill in June 2020, which became statute (Tenn. Code Ann. § 66-34-603) on July 1, 2020. This new section of the law was part of a bill that updated several sections of Tennessee’s Prompt Pay Act.