{"id":3940,"date":"2022-09-12T01:20:56","date_gmt":"2022-09-12T01:20:56","guid":{"rendered":"https:\/\/fwhtlaw.com\/?post_type=briefing-papers&p=3940"},"modified":"2022-11-18T20:19:31","modified_gmt":"2022-11-18T20:19:31","slug":"five-tips-to-preserve-your-right-to-payment","status":"publish","type":"post","link":"https:\/\/www.fwhtlaw.com\/blog\/2022\/09\/12\/five-tips-to-preserve-your-right-to-payment\/","title":{"rendered":"Five Tips to Preserve Your Right to Payment"},"content":{"rendered":"

Hugh Brown is a member of the firm’s Construction Law Department. He can be reached at 612.359.7663 or hbrown@fwhtlaw.com<\/a>.<\/p>\n

Contractors operating on thin margins in an era of escalating prices and supply chain disruption must be especially vigilant about maintaining their rights to payment for changed work.\u00a0 The following are good rules of thumb for all projects to preserve and document claims and take advantage of your legal rights.<\/p>\n

    \n
  1. Strictly Follow Notice Requirements<\/u><\/li>\n<\/ol>\n

    Notice requirements in contracts are of crucial importance.\u00a0 In some jurisdictions, failure to follow them results in the loss of a claim.\u00a0 Even in more lenient jurisdictions, the failure to provide notice can be critical if it prejudices an owner.\u00a0 A good practice is to create a \u201ccheat sheet\u201d of notice requirements for every project and refer to it often.\u00a0 When in doubt, provide written<\/u> notice.<\/p>\n

      \n
    1. Pay Attention to Project Records<\/u><\/li>\n<\/ol>\n

      Construction projects are complex, time-consuming, and document-intensive.\u00a0 Getting relief for an event depends on proving work was affected by the event and showing the cost and time impact.\u00a0 Without good project records, proving a claim takes longer, costs more, and is less credible.\u00a0 Keep good, contemporaneous records of your work on a project, including weather conditions, work performed, labor and resources on site, causes and extent of delays, any meetings that occurred, and agreements reached.\u00a0 Document other important events in writing or, where applicable, by photograph or video.\u00a0 Keep good records of your time and material costs to prove your right to a schedule extension or extra money.\u00a0 This can make all the difference when you later present a claim to your customer or seek relief in court or arbitration.<\/p>\n

        \n
      1. Communicate<\/u><\/li>\n<\/ol>\n

        An essential aspect of project records is communicating with your customer.\u00a0 In addition to the contractual notice requirements set out above, a claim is simply more credible when you can later show that you discussed it often with your client \u2013 e.g. that damages are continuing to accrue, that delays outside your control are extending the completion date, or that there are ways mitigate costs but you first need direction or answers to questions, etc. \u00a0\u00a0When writing these communications, remember they may be used as evidence later.\u00a0 Therefore, avoid anger, uninformed opinions, and conjecture.\u00a0 Ask yourself if the letter will look as good to you three months from now as it does today or if you would be uncomfortable having it shown to a judge, jury, or arbitrator.\u00a0 If in doubt, sleep on it.<\/p>\n

          \n
        1. Insist on Written Direction for Changes<\/u><\/li>\n<\/ol>\n

          A common problem for contractors is proving entitlement to costs incurred for changes ordered verbally.\u00a0 Without a direction in writing, claims for these costs can end up in a \u201che said, she said\u201d disagreement.\u00a0 This reduces the likelihood of recovery and makes early negotiated resolutions less likely.\u00a0 Therefore, ask for written direction for changed work.\u00a0 If you do not receive it, send a letter stating your understanding of the direction and asking for prompt clarification or correction.\u00a0 State your intention to seek extra costs and, where applicable, time resulting from the change.<\/p>\n

            \n
          1. Observe Lien Requirements<\/u><\/li>\n<\/ol>\n

            One of the most powerful tools a contractor has is its mechanic\u2019s lien rights.\u00a0 However, this tool can be lost without strict compliance with statutory requirements.\u00a0 Two, in particular, are worth noting.\u00a0 First, contractors on certain kinds of projects must provide the owner with \u201cpre-lien\u201d notice, are spelled out in Minnesota Statutes Section 514.011.\u00a0 Second, to be entitled to a lien, a contractor must serve and record a lien statement within 120 days of its last date of work.\u00a0 These requirements cannot be extended or excused.\u00a0 Do not wait until negotiations fail to perfect your lien rights \u2013 by then, it may be too late. \u00a0Contact counsel early to make sure you preserve this important remedy.<\/p>\n

            This article is a general discussion only and does not constitute legal advice or representation.<\/em><\/p>\n

            \n

            Announcements<\/strong><\/p>\n

            Hugh Brown<\/a> and Julia Douglass<\/a> will be presenting at the AGC of Minnesota\u2019s Fall Member Meeting<\/strong> on the Infrastructure Investment and Jobs Act (IIJA)<\/strong> on September 28, 2022 at 9:30 am.\u00a0 For more information click here.<\/a><\/p>\n

            Fabyanske, Westra, Hart & Thomson, P.A<\/strong>. is pleased to announce that Dean Thomson<\/a> and Julia Douglass<\/a> will be speaking on Mediation Strategies<\/strong> on October 17th to the Florida Bar Association Section on Construction Law.<\/strong> Virtual attendance to the seminar is available.<\/p>\n

            Fabyanske, Westra, Hart & Thomson, P.A.<\/strong> is pleased to announce the recognition of nine attorneys,\u00a0Mark Becker<\/a>, Matt Collins<\/a>, Rory Duggan<\/a>, Gary Eidson<\/a>, Marv Fabyanske<\/a>, Kyle Hart<\/a>, Jesse Orman<\/a>, Dean Thomson<\/a> and Tom Vollbrecht<\/a> by\u00a0U.S. News Best Lawyers\u00a9<\/sup><\/em>, one of the oldest and most respected peer-review publications in the legal profession. Dean Thomson<\/a> was also selected by Best Lawyers as\u00a02023 Attorney of the Year<\/strong>\u00a0in Construction Law. For more information click here.<\/a><\/strong><\/p>\n

            \n

            This discussion is generalized in nature and should not be considered a substitute for professional advice. \u00a9 2022 FWH&T<\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

            Hugh Brown is a member of the firm’s Construction Law Department. He can be reached at 612.359.7663 or hbrown@fwhtlaw.com. Contractors operating on thin margins in an era of escalating prices and supply chain\u2026<\/p>\n","protected":false},"author":7,"featured_media":1972,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[7,19],"tags":[],"class_list":["post-3940","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-briefing-papers","category-hugh-d-brown"],"acf":[],"yoast_head":"\nFive Tips to Preserve Your Right to Payment - Fabyanske, Westra, Hart & Thomson<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.fwhtlaw.com\/blog\/2022\/09\/12\/five-tips-to-preserve-your-right-to-payment\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Five Tips to Preserve Your Right to Payment - Fabyanske, Westra, Hart & Thomson\" \/>\n<meta property=\"og:description\" content=\"Hugh Brown is a member of the firm’s Construction Law Department. 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