Lien Waivers in Oklahoma Construction Industry
Oklahoma provides strong lien rights for contractors in the state. If a contributor to a construction project is not paid they may file a mechanics lien on the legal property of the project. This is a mechanism that provides significant leverage for getting paid for individuals and businesses that provide labor or materials in a construction job.
Many of the parties adding materials or labor to a legal property may never have any contact with the property owner and may deal entirely with the prime contractor. Thus, if there is a payment dispute between a prime contractor and subcontractor, a property owner can be on the hook for a debt that the property owner never knew was incurred by the prime contractor to a party that the property owner didn’t know existed for labor or materials the owner didn’t know was provided.
Property owners are highly motivated to keep their properties lien-free for a number of reasons. In order for a property owner to ensure that subcontractors promised payment will not file mechanics liens they will often require payees to sign a lien waiver in exchange for payments related to a project as routinely as requesting a receipt.
Oklahoma does not have standard lien waiver requirements as other states like Texas have. Since the drafting of a lien waiver is left up to the party requesting the waiver without limits set by the state, lien waivers can come in all kinds of shapes and sizes with any number of contractual provisions impacting the rights of the parties. While the Oklahoma construction industry routinely uses lien waivers the provisions are not standardized.
Lien waivers should not be taken for granted. The existence of a lien waiver and its provisions can hugely impact the course of a dispute. For example, in 2012 the Port of Houston had a $20 million judgment against it entirely overturned on appeal based on a lien waiver. They were also awarded about $10 million in attorney fees from the construction plaintiff to boot. This amounted to a $30 million mistake by the contractor with regard to a five year old lien waiver.
Get Help with Lien Waivers from a Construction Lawyer
Whether you are typically signing lien waivers, requesting lien waivers or both, you want to make sure you are getting this legal aspect of the work handled correctly. Call the Tulsa Construction Lawyer for help in drafting and reviewing the lien waivers for your construction projects at (918) 770-9330.