Subcontractor Waivers and Preservation of Claims

The requirement that subcontractors sign and submit Subcontractor Lien Waiver and Release forms when applying for progress and final payments is commonplace on construction projects. A recent case out of the United States District Court for the Western District of Pennsylvania has again made it abundantly clear that subcontractors must preserve any and all claims that they believe they have arising out of their work when signing and submitting waivers and releases in exchange for payment. In this particular court case, as is typical, the subcontractor signed and submitted subcontractor lien waivers and affidavit forms along with its several applications for payment. Unfortunately, during the course of the project, the subcontractor failed to properly preserve its claims which allegedly arose early on in the project when signing and submitting these waivers. By doing so, the general contractor argued, and the Court agreed, the subcontractor had waived any and all claims that it believed it had for additional payment due to delays because the subcontractor had signed and submitted subcontractor lien waivers and affidavit forms subsequent to the occurrence of the alleged delays without preserving those claims when submitting its subcontractor lien waivers and affidavit forms.

            This case is a reminder that subcontractors must remain vigilant in the preservation of their claims for additional monies when submitting waivers and releases on projects. For example, subcontractors should include language on the waiver and release forms that indicates that the waiver and release excludes any claims for delay, disruption or inefficiencies which the subcontractor had previously provided notice of. By noting in writing on the waiver and/or release that the claims were previously documented earlier on in the project, these claims will be preserved.

            We invite you to call the attorneys of our construction group in order to preserve your construction claims.

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Harrisburg Magazine Readers' Choice 2011