Not a Lexis+ subscriber? Try it out for free.
LexisNexis® CLE On-Demand features premium content from partners like American Law Institute Continuing Legal Education and Pozner & Dodd. Choose from a broad listing of topics suited for law firms, corporate legal departments, and government entities. Individual courses and subscriptions available.
by W. Alexander Burnett
A new Virginia law invalidates any mechanic’s lien or payment bond waiver signed before work has commenced.
The Governor recently signed new legislation into law, effective July 1, 2015, that invalidates waivers of subcontractors’, sub-subcontractors’ and suppliers’ mechanic’s lien and payment bond rights if executed before the waiving lien claimant has begun furnishing labor or materials to the project. In the past, it has been common in Virginia to see contracts between general contractors and subcontractors or other lower tiered subcontractors and suppliers that waived mechanic’s lien or bond claims before the project was even underway. Generally, these types of prospective lien waivers could be enforced in Virginia so long as the mechanic’s lien was either expressly and unambiguously waived or waived by clear implication.1This new legislation puts an end to that practice.
Importantly, this new law does not prohibit the waiver of mechanic’s lien and bond rights signed after the lien claimant provides labor, services or materials. In other words, it does not affect the common practice of requiring contractors to execute lien and bond waiver forms in exchange for payment for services and materials provided through the date of payment. For a link to the specific language that was added to the mechanic’s lien and payment bond statutes, click here.
This new legislation’s scope, however, is limited, and there are some key scenarios that are not affected by this new law.
If you’re a general contractor, the language in your form subcontracts and your mechanic’s lien waiver and release forms may be outdated. If you’re a subcontractor, you may have mechanic’s lien and payment bond rights. Please contact me or another member of the Williams Mullen Construction Practice Group if you have questions about this new law.
1VNB Mortgage Corp. v. Lone Star Indus., 215 Va. 366 (1974) [subscribers can access an enhanced version of this opinion: lexis.com | Lexis Advance]; see also McMerit Construction Company v. Knightsbridge Development Co., 235 Va. 368, 367 S.E.2d 512 (1988) (stating that a waiver, whether express or implied, must be established by clear and convincing evidence) [lexis.com | Lexis Advance].
Read more alerts by Williams Mullen attorneys
For more information about LexisNexis products and solutions, please connect with us through our corporate site.