No lien contract clauses

posted by Michael Fortney  |  Jan 5, 2010 7:31 PM in Construction Law:Contracts and Troublesome Provisions

An owner in Ohio may have a contract provision providing that contractor may not file a lien on project. The enforceability of such a provision is questionable. However, some Ohio courts have upheld such "no lien" provisions against contractors that sign them. Seveco, Inc. v. C&G Investment Associates, 1977 LEXIS 7341 (Franklin Cty. 1977).

Practical pointers:

 

  • If an owner asks for a no lien contract, a notice of commencement should be filed, with a notation that the project is a no lien project.
  • If a contractor agrees to a no lien provision, the contractor must put the same language in any contracts he enters into with lower tiered contractors or material suppliers.
  • In Pennsylvania, and in some other states, no lien contracts have been sanctioned by statute. The no lien provision has to be filed with the county recorder's office, to put all on notice.

 


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