That's a common thing in this part of MT when there is a lot of $ on the line. What has happened is hack contractor does a poor job. Client says "your work sucks, I'm not payin". Hack says: "ok... I'll file a lean and you'll pay me sooner or later". The work around is to know your client; a good relationship is imperative. If they want something like this the rebuttal would be to offer references, your ability to be bonded, the amount of time you've been in business, give permission to talk to your suppliers so they can verify that you pay your bills, things like that. Communicate to them that to sign away your legal right to compensation is suicide as no one knows what tomorrow holds.
Or, you can take your pen and draw a line through the parts that you don't like, initial it, sign, and see what happens. Our contract with the trades we work with is iron clad, even a little usury. Basically, if anything goes wrong it's their fault. We've had our contracts come back with those kinds of amendments and let it slide because we have worked with them for years.
Just wait until you land the mother load of jobs that require a lot of material and your supplier sends your client an intent to lien contract saying that nobody gets anything until the CLIENT signs away their right to legal recourse if YOU don't pay. And they don't tell you that they're going to send it. That's a good time right there.
Even with all the legal gyrations that are possible in this day and age it still all boils down to a handshake.
Normally, a Lien Waiver is signed when a Check is issued and only for the amount paid. But thats just me, I am sure it is not normal. However, it has worked for MANY years. NO WAY IN HELL I am signing one BEFORE payment. I have an MSA with most of the Majors including Chesapeake and I have NEVER signed one before payment.
It was with my first draw check. Was away from home and did not know a notary where I could sign, etc., so told them after I got done I'd get it done. I didn't sign it and it's a good thing.
Lien Waivers are usually done on both 'Progress Payments' and 'Final Payments' when paid in full. It will state the contract and job reference numbers, the total contract price, then the amount being paid currently. Many of the larger contractors will send a photo copy of the signed check but it doesn't get issuded to you until you either mail or hand them the Lien Waiver. Banks want them before issuing further funds to the General Contractor to verify expenses paid by the GC.
Most GC's want a progress billing to be invoiced by the 20th but it can include work that is projected to be completed by the end of the month. That will have a check issued about the 10th of the following month and will arrive to you, following reciept of the Lien Waiver, by the end of the month. About a one month delay.
Now, that can vary from company to company and job to job but is pretty common. Not often that you can get money up front as a deposit on a job like this but if the job is big enough the money starts flowing in time to keep your vendors paid. I have seldom had to get notarized waivers from my vendors as we don't let them know who we are ordering materials for. My wife just keeps everyone paid off each month regardless of when the money comes in for the job. I know not everyone works it quite that way for job accounting purposes but I do. To me it is about my working relationships with my vendors, not how the books look at any particular moment.
Have a Great Day, Brent
Good explanation Brent. All I saw when I finally read it over was my right to put a lien on the property should they decide they did not want to pay was null and void if I signed it. Now, if I had check in hand, better yet, in the bank and cleared then sure I'll sign a lien waiver but not until I get the final payment and it is tucked away safely in the bank. Signing if before hand sounds like a shot in your own foot.
