In general, a contractor or supplier is entitled to file a lien against a commercial property if they have performed work or provided materials pursuant to a written contract with the owner. These lien claims must be filed within 90 days of the last date of providing materials or services for the project.

On the other hand, if a contractor or supplier is providing materials or services for a tenant of a commercial property, the rules are different. The differences as to what the lien may attach to are discussed in detail below.

Continue Reading Construction Liens on Leased Commercial Premises

Although it is typical for AIA form contracts to contain arbitration clauses, as a contractor you should consider whether you should have an arbitration clause in your construction agreement. As discussed below, there are numerous factors to consider in determining whether mandatory arbitration is the preferred dispute resolution mechanism, or whether the state court system is preferred. Although arbitration may have some advantages, there are also disadvantages which must be considered rather than simply adopting the AIA form. Continue Reading Should I Have an Arbitration Clause in My Construction Contract?

Whether you are a general contractor or a subcontractor, you have probably come across a pay when paid clause within a subcontract or general contract. The idea of the clause is that the contractor or subcontractor would not be responsible for payment to a lower-tier contractor unless and until it has received payment pursuant to its contract with an upper-tier contractor or owner. While this is a good idea, the Courts have often found such provisions to be unenforceable.

Continue Reading Pay When Paid Clauses in Construction Contracts

In general, a contractor, subcontractor, or supplier is entitled to file a construction lien on a commercial project provided that the lien is filed within 90 days of the last date the entity provided materials or services with regard to the subject project. There are certain requirements, however, that must be met prior to being able to file a construction lien.

The first requirement is Continue Reading Your Right to File a Construction Lien on a Commercial Project

At times, it may become necessary to amend a construction lien claim after if it is initially filed. The relevant statutory authority which addresses this issue is codified by N.J.S.A. 2A:44A-11. In general, this section provides that a lien claim may be amended for any appropriate reason, including but not limited to, correcting inaccuracies in the lien claim or errors in the original form, or revising the amount claimed in the lien claim. Continue Reading Amending a Construction Lien Claim

As the owner of a parcel of property, you might someday be faced with a scenario wherein a construction lien filed by a contractor who performed work for you was either improperly filed, or is simply invalid on its face. The issue becomes what is the proper way to remove and/or discharge this construction lien so that the property is no longer encumbered.

Continue Reading Removing an Invalid Construction Lien

If you are either a subcontractor or a material supplier on a municipal project and you are not receiving payment from the general contractor or subcontractor, you may have to bring a claim against a payment bond posted by the general contractor. In order to be entitled to make a claim against such a bond, it is important that you follow the protocol required by the relevant New Jersey Statutes. If you do not follow this protocol, you may be barred from making a claim against the bond.

In the relevant New Jersey Lien Law, N.J.S.A. Section 2A:44-145, it explains that a person who does not have a direct contractual relationship with a contractor must provide explicit written notice to the contractor, which explains that the person is an intended beneficiary under the bond. Only after this written notification is provided does that person have the ability to bring forth a claim, and that right commences the day the notice is presented.

Continue Reading Making a Claim Against a Bond on a Municipal Project

In construction projects that are performed either on behalf of a municipality or a state agency, a general contractor and potentially a sub-contractor are typically required to post payment and/or performance bonds with the county or municipality. A general contractor or sub-contractor is required to post a payment and/or performance bond, because this ensures that sub-contractors or suppliers are paid, and enables the Township or state agency to have the work completed should the contractor fail to do so in a timely fashion. As a supplier or sub-contractor on such a municipal or state project, it is important to know your rights with regard to making a claim against a payment bond.

The most important thing that any sub-contractor or supplier must do prior to providing materials or services for a public contract is to provide the proper notice as required by N.J.S.A. 2A.44-145. This strict notice requirement specifies that the sub-contractor or supplier notify the party who posted the payment bond for the project in writing via certified mail of their intent to provide materials or services for the project. This is a prerequisite to being able to make a claim against the bond, or to receive a payment for materials and services with regard to the project if they are not paid by the sub-contractor or general contractor. As such, it is very important that any sub-contractor or supplier provide the appropriate notice to the party that posted the bond prior to performing any work or providing any materials.

Continue Reading Making a Claim against a Payment Bond Posted by a General Contractor or Sub-Contractor