From Unsecured to Secured – Factors That Influence How You Secure Your Project Payments

02/25/2024|National Lien & Bond|

At Emalfarb Law LLC and National Lien & Bond, we tell our construction industry clients that they essentially loan their clients money when they take on a job – whether as a subcontractor or a supplier to a construction project. What we mean by that is as soon as a client commits any resources to a project their customer has agreed to pay for, they assume the risk that the customer won’t pay when they’re supposed to or, at times, won’t pay at all.

How to Achieve Secured Status

Fortunately, there are steps you can take to put yourself in a secured position in almost every construction project situation. Unfortunately, no single solution gets you to that secured point. That’s because a number of factors go into determining how best to secure your future payments for the work you do or the materials you supply. Some of the major factors are:

  • Where your project is located. Each state has its own laws that govern how mechanics or construction liens operate, and in most cases, you need to follow that state’s procedures strictly.
  • Whether you met notice requirements. This relates to where your project is; depending on the state, you may have to notify the project owner of who you are and your role in the project if you want to be in a legal position to assert a mechanics’ lien if you’re not paid. Whether, when, and how you do that will vary from state to state.
  • Who your customer is. If you’re working on a project for the federal government, you need to follow a different set of requirements than if you’re working for a private company. If your client is a state or local government, other requirements are likely to apply.
  • Whether the job is bonded. If the job is bonded, you will likely have to follow a different path to securing your payments than if it’s not.
  • The terms of your contract. Sometimes it’s possible to negotiate contract terms that will provide you with substantially greater security.
  • What your status is. Depending on the type and location of your job, if you’re a sub-subcontractor or a supplier to a subcontractor, you may not have mechanics’ lien rights. Still, you may be able to negotiate yourself to a more secured position.

For more information about how you can secure future payments for your construction work, you can view our free webinar, “Protect What You Are Owed in Turbulent Times.”

Contact Emalfarb Law LLC For a Free Consultation

At Emalfarb Law LLC, we are devoted to helping clients in the construction industry get paid on time, making it easier to protect themselves when they don’t, and collecting past-due funds. In fact, over the years, we’ve helped our clients recover more than $9 billion in past-due claims for contract work. We have a strong network of dedicated and experienced attorneys in all 50 states who understand how to prepare and file a mechanic’s lien. Working with us means working with professionals focusing on getting you paid.

We can help you in several different and complementary ways:

  • We work with clients to develop in-house best practices to keep tabs on projects so they know when payments are late and what to do next.
  • We help clients understand what steps they need to take to protect their receivables, steps that can vary depending on the project location, the owner, the type of project, and the client’s role in the project.
  • We help prepare, serve, and file mechanics liens, payment bond claims, and non-payment lawsuits.
  • We negotiate with owners and contractors on behalf of our clients from a position of knowledge and strength.

Contact Emalfarb Law LLC at (847) 208-6513 or by using our contact form to schedule a consultation. Tell us about your company, and let us share how we can help you get paid.