Is the lien waiver our subcontract makes us sign up front enforceable in Minnesota?
No, on the statute's own terms. Provisions contained in, or executed in connection with, a building and construction contract requiring a contractor, subcontractor or material supplier to waive the right to a mechanics lien or to a claim against a payment bond BEFORE the person has been paid for the labor or materials or both that the person furnished are void and unenforceable (Minn. Stat. § 337.10, subd. 2). The same subdivision preserves one exception on its face: 'This provision shall not affect the validity of a waiver as to any third party who detrimentally relies upon the waiver.'
The trap
The third-party-reliance sentence is the part that gets missed, and it can make a void waiver operative against you in practice: a lender or title company that detrimentally relies on the waiver you signed is protected by the statute even though the waiver is void as between you and the party who demanded it. Two scope points from the text itself. The subdivision reaches a 'building and construction contract' as defined in § 337.01 (a contract for the design, construction, alteration, improvement, repair or maintenance of real property, highways, roads or bridges), so it does not by its words reach a contract outside that definition, and the definition expressly excludes 'contracts for the maintenance or repair of machinery, equipment or other such devices used as part of a manufacturing, converting or other production process'. And the trigger is payment, not timing of signature: the waiver is void where it is required before the person 'has been paid for the labor or materials or both that the person furnished', so a waiver given for and limited to payment actually received is not what this subdivision voids. Minnesota's mechanics lien chapter itself (Minn. Stat. ch. 514) is not quoted in this rule, so nothing here states the content, form or timing requirements of a lien waiver or of a lien statement.
3 authorities
- statuteMinn. Stat. § 337.10enactment date not established
The words that state the rule
Provisions contained in, or executed in connection with, a building and construction contract requiring a contractor, subcontractor, or material supplier to waive the right to a mechanics lien or to a claim against a payment bond before the person has been paid for the labor or materials or both that the person furnished are void and unenforceable. This provision shall not affect the validity of a waiver as to any third party who detrimentally relies upon the waiver.
- statuteMinn. Stat. § 337.01enactment date not established
The words that state the rule
"Building and construction contract" means a contract for the design, construction, alteration, improvement, repair or maintenance of real property, highways, roads or bridges. The term does not include contracts for the maintenance or repair of machinery, equipment or other such devices used as part of a manufacturing, converting or other production process, including electric, gas, steam, and telephone utility equipment used for production, transmission, or distribution purposes.
- statuteMinn. Stat. § 337.10enactment date not established
The words that state the rule
For the purpose of this section, "building and construction contract" has the meaning given the term in section 337.01 .
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.