Is the up-front mechanics-lien waiver in our Rhode Island subcontract enforceable?
No, except a written waiver executed and delivered simultaneously with or after payment. R.I. Gen. Laws § 34-28-1(b) makes a covenant in or collateral to a construction contract “purporting to bar the filing of a notice of intention or the taking of any steps to enforce a lien as set forth in this chapter … against public policy and … void and unenforceable”, and the Supreme Court has read it that way: “§ 34-28-1(b) … expressly prohibits any contractual waiver of a party’s right to file a mechanic’s lien” (Newman v. Valleywood Associates, Inc.). The same subsection then carves out the paid waiver: it “shall not preclude a requirement for a written waiver of the right to file a mechanic’s lien executed and delivered by a contractor, subcontractor, material supplier, or laborer simultaneously with or after payment for the labor performed or the materials furnished has been made”. A DIFFERENT SECTION runs the other way and is the one that decides most real disputes: under § 34-28-26 a signed subordination agreement or release “which purports to subordinate or release any lien … whether for work done or materials furnished prior to the agreement or release, or thereafter, or both, notwithstanding the fact that no consideration is given therefor, shall be enforceable according to its terms, by any other person who has changed his or her position in any way in reliance upon” it. A lienor who releases before being paid keeps only § 34-28-27’s right to “demand and receive direct payment … from the owner”.
The trap
The Rhode Island line is between a WAIVER OF THE RIGHT TO FILE and a RELEASE. Section 34-28-1(b) voids the first unless it is given simultaneously with or after payment; § 34-28-26 makes the second “enforceable according to its terms” with NO consideration at all, against anyone who changed position in reliance on it. Calling the closing document a release or a subordination rather than a waiver moves it out of the protective subsection entirely, and nothing in § 34-28-26 requires that the signer have been paid. Second, read § 34-28-1(b)’s own subject matter before relying on it: the ban covers work on “a building, structure, appurtenance and appliance, including moving, demolition and excavating connected therewith”, which is narrower than the lien itself in § 34-28-1(a) (“any building, canal, turnpike, railroad, or other improvement”) and narrower than the construction anti-indemnity statute § 6-34-1, which does reach a “highway, road”. Third, Newman’s footnote (“any contractual waiver”) is broader than the subsection it cites, which expressly preserves the paid waiver: serve the statute, not the footnote. Fourth, on a state or municipal job § 34-28-31 means there is no lien to waive at all (“No lien … shall attach … if the improvement is being constructed … by or for the state, or any city or town”); the substitute is the § 37-12-1 payment bond, suable under § 37-12-2 after ninety days. Fifth, an unregistered contractor “may not file a lien” in the first place (§ 5-65-4). And on a “contract for construction” a lien waiver or release is a statutory “deliverable” that “shall comply with chapter 28 of title 34” (§ 5-65-1(8)), while § 37-12-10.1(k) voids any term that “purports to waive, limit, or subvert” the retainage section it is delivered under. Two qualifications a form must not miss: § 5-65-4(b) lets “[a] court … choose not to apply this section if the court finds that to do so would result in a substantial injustice to the unregistered contractor”, so the registration bar is not absolute; and on a public job the § 37-12-1 bond is reachable by a second-tier claimant only on the written notice § 37-12-2's proviso requires within ninety days of the last labour or material.
17 authorities
- statuteR.I. Gen. Laws § 34-28-1enactment date not established
The words that state the rule
purporting to bar the filing of a notice of intention or the taking of any steps to enforce a lien as set forth in this chapter is against public policy and is void and unenforceable.
- statuteR.I. Gen. Laws § 34-28-1enactment date not established
The words that state the rule
This section shall not preclude a requirement for a written waiver of the right to file a mechanic’s lien executed and delivered by a contractor, subcontractor, material supplier, or laborer simultaneously with or after payment for the labor performed or the materials furnished has been made to such contractor, subcontractor, material supplier, or laborer.
- statuteR.I. Gen. Laws § 34-28-1enactment date not established
The words that state the rule
A covenant, promise, agreement of understanding in, or in connection with or collateral to, a contract or agreement relative to the construction, alteration, repair, or maintenance of a building, structure, appurtenance and appliance, including moving, demolition and excavating connected therewith
The words that state the rule
It is important to distinguish between a contractual waiver of the right to arbitrate a dispute, which is discussed above, from a contractual waiver of a right to file a mechanic’s lien. General Laws 1956 § 34-28-1(b) *1289 expressly prohibits any contractual waiver of a party’s right to file a mechanic’s lien.
The words that state the rule
To achieve this end, any contractual agreement barring the filing or enforcement of a mechanic’s hen “is against pubhc policy and is void and unenforceable.” Section 34-28-1(b).
- statuteR.I. Gen. Laws § 34-28-26enactment date not established
The words that state the rule
Any subordination agreement or release, bearing the signature of any person with authority to sign the agreement or release, or of the person who is designated in a notice of intention under § 34-28-4 as the person whose signature will bind the person filing the notice, which purports to subordinate or release any lien under § 34-28-1, 34-28-2, 34-28-3 or 34-28-7 whether for work done or materials furnished prior to the agreement or release, or thereafter, or both, notwithstanding the fact that no consideration is given therefor, shall be enforceable according to its terms, by any other person who has changed his or her position in any way in reliance upon the subordination agreement or release
- statuteR.I. Gen. Laws § 34-28-27enactment date not established
The words that state the rule
Any person entitled to any lien under § 34-28-1, 34-28-2 or 34-28-3 who releases the lien before receiving payment for the work done or materials furnished forming the basis of the lien, shall be entitled to demand and receive direct payment therefor from the owner or lessee or tenant or other person as may be obligated or permitted to make the payment on behalf of the owner or lessee or tenant, provided that the person entitled to the lien first obtains the written consent of all persons in line of privity between him or her and the owner or other person
- statuteR.I. Gen. Laws § 34-28-31enactment date not established
The words that state the rule
No lien under § 34-28-1, 34-28-2 or 34-28-3 shall attach to any building, canal, turnpike, railroad, or other improvement, if the improvement is being constructed, erected, altered, or repaired by or for the state, or any city or town, or any subdivision or agency thereof, or to any land upon which the improvement exists, if the land is owned by the state or any city or town, or any subdivision or agency thereof, but the provisions of § 34-28-30 shall apply to buildings, canals, turnpikes, railroads, or other improvements being so constructed, erected, altered, or repaired.
- statuteR.I. Gen. Laws § 37-12-2enactment date not established
The words that state the rule
who has not been paid in full therefor before the expiration of a period of ninety (90) days after the day on which the last of the labor was performed or furnished by him or her, or material or equipment furnished or supplied by him or her for which a claim is made, shall have the right to sue on the payment bond
- statuteR.I. Gen. Laws § 5-65-4enactment date not established
The words that state the rule
A contractor may not file a lien, file a claim with the board, or bring or maintain in any court of this state a suit or action for compensation for the performance of any work on any structure or for the breach of any contract for work on any structure that is subject to this chapter, unless the contractor was
- statuteR.I. Gen. Laws § 5-65-1enactment date not established
The words that state the rule
provided, however, that a lien waiver or release, which is a deliverable, shall comply with chapter 28 of title 34
- statuteR.I. Gen. Laws § 37-12-10.1enactment date not established
The words that state the rule
A provision in a contract for construction that purports to waive, limit, or subvert this section or redefine or expand the conditions for achievement of substantial completion for payment of retainage shall be void and unenforceable.
- statuteR.I. Gen. Laws § 34-28-32.2enactment date not established
The words that state the rule
This chapter is intended to afford a liberal remedy to all who have contributed labor, material, or equipment towards adding to the value of property to which the lien attaches and should be construed accordingly.
- statuteR.I. Gen. Laws § 6-34-1enactment date not established
The words that state the rule
A covenant, promise, agreement, or understanding in, or in connection with or collateral to, a contract or agreement relative to the design, planning, construction, alteration, repair, or maintenance of a building, structure, highway, road, appurtenance, and appliance, including moving, demolition, and excavating connected with a building, structure, highway, road, appurtenance, or appliance
- statuteR.I. Gen. Laws § 5-65-4enactment date not established
The words that state the rule
A court may choose not to apply this section if the court finds that to do so would result in a substantial injustice to the unregistered contractor.
- statuteR.I. Gen. Laws § 37-12-2enactment date not established
The words that state the rule
provided, however, that any person having direct contractual relationship with a subcontractor but no contractual relationship express or implied with the contractor furnishing the payment bond shall have a right of action upon the payment bond upon giving written notice to the contractor within ninety (90) days from the date on which the person furnished or performed the last of the labor, or furnished or supplied the last of the material or equipment for which the claim is made, stating with substantial accuracy the amount claimed and the name of the party to whom the labor was furnished or performed or the material or equipment was furnished or supplied. The notice shall be served by mailing the same by certified mail, postage prepaid, in an envelope addressed to the contractor at any place he or she maintains an office, conducts his or her business, or his or her residence.
The words that state the rule
Furthermore, the remedy provided by the Mechanics’ Lien Law is not exclusive; “[ejxcept as otherwise specified, nothing in this chapter shall be construed to limit the *1290 right of any person, whether he or she have [sic ] a valid lien hereunder or not, to remedies otherwise available to him or her under law
“Defective” means that reading found something to correct. What you are reading is the rule as it stands after that reading.