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Prime's Default Defeats Sub's Lien Rights Subcontractors; Liens

Wednesday, March 03, 2004 12:21 pm

Prime's Default Defeats Sub's Lien Rights Subcontractors; Liens

The Massachusetts Supreme Court has ruled that when a prime contractor defaults, the contract balance is not an "amount due or to become due" for purposes of funds available to cover subcontractor liens.

The Boys' and Girls' Club of Taunton Incorporated awarded a $1.58 million contract to Warfield Services, Inc. for construction of a new child care center. Warfield subcontracted the flooring work to BloomSouth Flooring Corp.

Warfield performed most of the work, but with a contract balance of $171,174 remaining, Warfield abandoned the project. The Club declared Warfield in default and paid another contract [...]

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