As a construction professional, you will likely have to sign lien waivers at some point. Knowing when to sign which type of lien waiver is very important. When you sign a lien waiver, you essentially give up your right to file a mechanics lien with regards to a specific amount of your services.
In Nevada, you cannot just use any type of lien waiver. The state has statutorily prescribed lien waivers, and you should know which form applies to your case before you sign away your lien rights. This guide specifically discusses the basics of a Nevada Unconditional Progress Payment Waiver.
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- When do you sign a Nevada Unconditional Progress Payment Waiver?
- How to fill out a Nevada Unconditional Progress Payment Waiver
- Best practices before signing a Nevada Unconditional Progress Payment Waiver
When do you sign a Nevada Unconditional Progress Payment Waiver?
You must sign a Nevada Unconditional Progress Payment Waiver when you meet the following conditions:
a. You have already received payment.
You must first verify that you have the payment on hand before you sign away your lien rights. The keyword to take note of here is unconditional: by signing an unconditional waiver, you are giving up your lien rights over the stipulated amount under no conditions of payment. Whether you get paid or not, you surrender your lien rights the moment you stamp your signature on a Nevada Unconditional Progress Payment Waiver.
b. You are expecting more payment.
Since you are signing a waiver for progress payment, it means that you are only partially giving away your lien rights. A Nevada Unconditional Progress Payment Waiver is usually signed as a condition for releasing part of your payment. The implication is that your work on the project is still ongoing so you will still be receiving future payment for your continuing services.
Make sure that you fulfil the two criteria above before signing a Nevada Unconditional Progress Payment Waiver. If you do not meet one or both of the two conditions, consider looking at other types of Nevada lien waivers which may be more appropriate for your situation.
How to fill out a Nevada Unconditional Progress Payment Waiver
In Nevada, you are supposed to use the statutorily prescribed lien waiver forms – using your own customized form and failing to include even just part of the required statements will render your Nevada lien waiver ineffective.
The Nevada Unconditional Progress Payment Waiver must be in the following form, in accordance with Nevada Revised Statutes § 108.2457:
Aside from using the correct lien waiver form, it is just as important to make sure that you fill out the required information properly. You need to make sure that you get the following details right:
a. Property name
Most projects have a designated project name. If there is no official project name, you may use the street address of the project location instead.
b. Property location
You may use the street address of the project location for this part.
c. Undersigned’s customer
Write the name of the party who hired you. Make sure that you write their complete name and that the name is correctly spelled. If you have a contract with a business, also ensure that you write the complete business name, including the appropriate suffix (e.g. Ltd., Inc.).
d. Invoice/payment application number
The payment that you receive in exchange for signing a Nevada Unconditional Progress Payment Waiver should come with an official invoice. Write the corresponding invoice or payment application number here. Make sure that you are writing the correct invoice number – double-check the amount as well as the items and dates covered.
e. Payment amount
This is the amount of the partial payment that you received in exchange for signing this waiver. Keep in mind that this is a progress payment waiver, so you should only sign it if you are still expecting more payment in the future (i.e. this is not your final payment amount).
This is the date when you sign the waiver.
g. Company name
This is the name of your company. Be sure to write the full name of your company; minor misspellings do not reflect well on your professionalism.
h. Your or your agent’s name (By)
This is your name and signature, or the name and signature of your agent.
i. Your or your agent’s title (Its)
This is your job title or the job title of the person signing the waiver on your behalf.
Best practices before signing a Nevada Unconditional Progress Payment Waiver
1. Ensure that you have the correct Nevada Unconditional Progress Payment Waiver form
It is very important to remember that you may not use just any kind for lien waiver form in Nevada. You have to use the statutorily prescribed form, as it includes all the required statements and tells you what information you must write on the form.
This guide specifically talks about a Nevada Unconditional Progress Payment form, so use this waiver only when you are waiving your lien rights unconditionally and that you are doing so only for progress or partial payment.
2. Verify that you have received payment
Given that this is an unconditional lien waiver, you have no fallback if the hiring party does not pay up since you have already signed your lien rights away for this particular project. It is, therefore, best practice to make sure that you have confirmed that payment has been received before signing this waive.
Under no circumstances must you sign a lien waiver if you only have a cheque or a quick credit card payment on hand – a cheque may bounce or a credit card payment may get rejected. Before signing this Nevada lien waiver, ensure that the cheque has been cleared by the bank or that a credit card transaction has been approved.
3. Make sure that all the information in the waiver is accurate
All the required details on your Nevada Unconditional Progress Payment Waiver form must be correct and accurate. Pay attention to the spelling of the business names, as well as the payment amount and its corresponding invoice number.
The payment details must match and all other details must be properly spelled and formatted. Make it a habit to double- and triple-check all the information that you write to avoid potential issues with compliance with the rules.