Construction participants must be very careful when signing lien waivers. When you sign a lien waiver, you essentially sign away your lien rights over a portion of the payment that you are supposed to earn on a project.
In Oregon, the lien laws are fairly relaxed. There are no specified templates and you may sign an enforceable lien waiver at any stage of the project, even before you start working on it. It is, therefore, very important that you read through a lien waiver thoroughly and make sure that you completely understand what it entails.
This guide answers your questions about the Oregon Unconditional Waiver and Release on Progress Payment.
- When do you use an Oregon Unconditional Waiver and Release on Progress Payment?
- How to prepare an Oregon Unconditional Waiver and Release on Progress Payment?
- Best practices before signing an Oregon Unconditional Waiver and Release on Progress Payment
When do you use an Oregon Unconditional Waiver and Release on Progress Payment?
An Unconditional Waiver and Release on Progress Payment in Oregon is used when the following situations apply:
a. You have confirmed that the payment is on hand.
Since this is an unconditional lien waiver, it means that you are surrendering your lien rights with no conditions. If your client ends up not releasing payment and you have already signed an Oregon unconditional lien waiver, you may no longer file a mechanics lien to make a payment claim over the amount that you waived.
b. You are not yet receiving your final payment.
This is also a lien waiver for progress payment, which means that you should use this waiver when your work on a project is still ongoing. You are still expecting to receive more payment in the future and you only received partial payment for your continuing work in the project.
It is very important to remember that using the Oregon Unconditional Waiver and Release on Progress Payment offers you little to no protection if your client does not pay up. When reading through a lien waiver, always be on the lookout for words like “unconditional” or “under no conditions” before you sign it.
Never sign an unconditional lien waiver in Oregon unless you have verified that you have the payment in your account.
How to prepare an Oregon Unconditional Waiver and Release on Progress Payment?
Oregon does not have a required template for its lien waivers. Generally, however, an Oregon Unconditional Waiver and Release on Progress Payment has the following information:
a. The type of lien waiver
The words “Unconditional Waiver and Release on Progress Payment” are typically written on top of the document.
b. Your name
This is your full (business) name.
c. The name of the party who hired you
This is the name of your client. Make sure to write their full business name as well.
d. The name of the property owner
This is the name of the property owner. You may write multiple names if there are multiple owners.
e. A description of the job location
This is a street address or a legal property description or any description that is sufficient for identifying the project location.
f. The amount that you are waiving
This is the amount of the payment that you just received. When you sign this waiver, you will not be allowed to recover this payment via a mechanics lien. Be sure that this amount is already in your pocket before you sign the Oregon Unconditional Waiver for Progress Payment.
g. Payment application or invoice number
This is the invoice number that corresponds to the payment that you listed in the previous item. Make sure that the amount that you write on this waiver matches the amount on the actual invoice.
h. A statement saying you have already been paid the aforementioned amount and are waiving your lien rights
Ideally, all Oregon unconditional progress payment lien waivers should contain a statement that says you have already received the payment. You should not sign an unconditional lien waiver unless you agree that you have gotten paid indeed.
i. Your name, job title and signature
The bottom of the document must contain your name, your official job title and your signature. If you are authorizing a third-party agent to sign lien waivers on your behalf, have them write their name, title and signature.
Best practices before signing an Oregon Unconditional Waiver and Release on Progress Payment
1. Read through your job contract carefully
A lien waiver in Oregon does not always have to be a separate document — sometimes it can be discreetly hidden in your job contract. There are no strict laws in Oregon regarding lien waivers, and you are technically allowed to waive your lien rights prior to starting your work in a project. If you want to have your lien rights intact until you get paid, make sure to be very careful when signing a contract.
2. Verify that you have indeed received payment before signing
Even if your client has already given you a cheque or has paid you through a credit card transaction, you must wait until you are certain that payment is on hand before you go ahead and sign an Oregon Unconditional Waiver and Release on Progress Payment. A cheque can bounce and a credit card payment can get rejected — an unconditional lien waiver does not protect you if those unfortunate scenarios happen.
3. Make sure that the amount that you write on the Oregon lien waiver is accurate
This lien waiver is specifically for progress payment, which means that it is only part of your payment on an ongoing project. Be sure that the amount you state in an Oregon lien waiver is correct and accurate because it will be very difficult to retract an already signed lien waiver. One way to verify this is to check the invoice or payment application number and see if the amount matches the value that you are writing on your lien waiver.