Every contractor has been asked to sign a lien waiver. But, are you closely reviewing the
waiver? Do you know what rights you are waiving?
This waiver constitutes a representation by [Contractor] that the payment referenced above, once received, constitutes full and complete payment for all work performed, and all costs or expenses incurred relating to the work or improvements at the Project as of the date of this waiver, except payment of retainage. [Contractor] specifically waives, quitclaims and releases any claim for damages due to delay, hindrance, interference, acceleration, inefficiencies or extra work, or any other claim of any kind it may have as of the date of this Waiver.
This waiver arguably waives any and all claims that the contractor may have up until the date of the waiver.
But, what about the delay claim that hasn’t matured yet? What about the “billing” issue that you brought up to the foreman? Is the contractor waiving these claims when he signs the waiver?
Chances are that the contractor is waiving these other claims. Sure, arguments can be made that the contractor did not intend to waive certain claims, but that’s an uphill battle. Instead, a contractor would be well advised to add some language to the waiver that identifies the claims that are not being waived.
Contractors sign waivers regularly. But, how often do you really review the waiver language and know what you are waiving?