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SLDF in Action in Oklahoma: ASA Files to Defend Subcontractor in Lien Waiver Case

The American Subcontractors Association produced an application to file an amicus curiae brief in the Oklahoma Supreme Court this week, asserting that the outcome of the case at hand could have significant adverse consequences for subcontractors and suppliers. The case, H2K Technologies, Inc. v. WSP USA, Inc.and Fidelity and Deposit Company of Maryland is currently on appeal to the Supreme Court of the State of Oklahoma.

This appeal arises following the judgment by a trial court in favor of an Owner, dismissing the lien claim of a Subcontractor who provided labor and materials to improve the owner’s property.   In the original contract, the Contractor agreed to waive its lien rights and to insert similar lien waivers into any subcontracts it entered into.  When the Contractor hired Subcontractor, however, the agreement did not contain any such lien waiver language, did not refer or incorporate the prime contract and did not advise Subcontractor its lien rights were purportedly waived.  This Contractor eventually filed for bankruptcy without having paid Subcontractor anything for its work. The Subcontractor then filed a lien against Owner’s subject property.

The trial court held that even though Subcontractor had no knowledge of the lien waiver agreed to by Contractor, it was held to have “constructive notice” of the terms of the prime contract, and thus its lien rights had been waived by Contractor.  The Subcontractor is appealing this ruling to the Oklahoma Supreme Court.

Click here to view the full press release.