Should I Sign That $10 Lien Release?
My clients frequently ask me why the release says $10 when they are picking up a check for much more money. According to the law, $10 is simply a “recitation of consideration.” It doesn’t really mean $10; it means some amount of money. The problem is $10 isn’t specific enough. If you are expecting a check, you should always try to change the $10 to the actual amount you are expecting. Why? Say you are expecting a $30,000 check and you only pick up $20,000. If the release says $10, you have accepted “some amount of money” and it may be difficult later to argue that you were shorted $10,000.
It is, however, okay to give a $10 release when there is no payment required. For example, if you send a notice to owner today and you don’t start work for two months, you may still be asked to provide a release from now until work begins. That’s a situation when it’s okay to give a $10 release because you’re not expecting a check in exchange for that release.
Alexander Barthet is a board certified construction attorney in Florida and holds a B.S. in mechanical engineering. He manages The Barthet Firm, a 10 lawyer construction law firm in Miami, and maintains a construction law blog at www.TheLienZone.com. He can be reached at 305-347-5295 or firstname.lastname@example.org.