Should You Bond Off a Lien Claim on Your Project? Part 2
In part one of this two-part series, a Nashville construction dispute lawyer from Cotney Construction Law discussed how “bonding off” a mechanics lien works and detailed the various parties that can benefit from doing so. Now, we will discuss whether or not you should bond off a lien claim for your project. Remember, for all of your construction law needs, including lien law, bond law, contract negotiation and review, bid proposals and protests, and more, consult an experienced and knowledgeable Nashville construction dispute lawyer. Don’t let an avoidable mistake outside of your scope of knowledge derail your projects and prevent you from getting paid.
Both Parties Can Agree That Avoiding Foreclosure is Important
Mechanics liens have a tendency to put a project on hold while things get sorted out. This can put the property in danger of foreclosure. When no money is coming in or out, it creates a problem for everyone involved. In contrast, bonding off a lien claim can keep the project running smoothly, albeit temporarily. During this brief period of respite, contractors and property owners can attempt to resolve the dispute. Although a courtroom battle could be inevitable, it’s always preferable to take as many preventive measures as possible before settling on litigation.
What Does Your Contract Have To Say About Liens?
Many contracts include a lien waiver stipulating that the contractor is barred from filing a lien against the property in question. When this is the case, the only way to obtain due compensation is by bonding off the lien claim. Although this typically helps the owner avoid foreclosure and litigation, it also gives you more time to resolve the dispute. Still, it’s always in your best interest to consult a Nashville construction dispute attorney before making any final decisions that potentially restrict your ability to pursue an owner for due payment.
Changing the Dynamics of the Lien Process
Some people might argue that bonding off a lien claim is neither a good or bad thing, and that it is simply a way to alter the dynamics of a dispute. If you are a potential claimant, bonding off your lien doesn’t mean you should abandon the mechanics lien claim process altogether, in fact, you may want to consult a Nashville construction dispute attorney to manage both processes for you simultaneously.
If you would like to speak with a Nashville construction dispute attorney, please contact us today.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.