Empire State Subcontractors Association
Legislative Victories

1975 WAIVER OF LIEN LAW

Declared contracts or agreements having provisions where the right to file or enforce a lien was relinquished to be against public policy1 void and unenforceable.
 

1975 HOLD HARMLESS LAW

Declared agreements exempting owners and contractors 'harmless" from their "sole" negligence and liability void and unenforceable.
 

1976 DESIGNATED CARRIER LAW

Prohibited the contractual duty of a contractor or subcontractor to purchase or obtain any insurance policies or surety bonds specified in such contract from a particular insurance or surety company, agent or broker.
 

1977 NOTICE OF COMPLETION LAW

Allows any person performing work or supplying materials to any public work to file a demand of notification of acceptance. Mandates that individuals be notified within five days of acceptance.
 

1978 CONTRACT INFORMATION LAW

Required that all construction contracts executed after Saturday, September 23, 1978 must contain: The full name and address of the owner; the full name and address of the owner of the land and the owner of the building, if different; and a description by street address or section, block and lot numbers, or reference to a deed book and page number. This bill gave contractors and subcontractors access to information that would enable him to file a lien or initiate action to collect unpaid monies.
 

1978 PAYMENT RETAINAGE LAW

Passed with GBC-AGC support and lobbying effort, this bill required: public owners to retain not more than 5% of each progress payment; public owner to pay for materials delivered to the site or off site if the materials are in short supply or specially fabricated; and the payment of subcontractors within 15 days of the payment to the prime contractor from the public owner.
 

1980 ATTORNEYS FEES

Enables subcontractors who make successful claims for overdue payments on public projects to recover interest and legal fees.
 

1980 CLAIM NOTICES

Allow a notice under the payment bond to be filed within 120 days rather than the 90 days previously allowed to a second tier sub or supplier. It also extends suit time for one year from date the project is accepted rather than when last material or labor was furnished.
 

1981 FILING OF BONDS

Requires the filing of copies of payment and performance bonds, when supplied on private projects, in the County Clerk's office in the county in which the improvement is performed, when the amount of construction exceeds $100,000.
 

1981 TECHNICAL CORRECTIONS

Makes a technical correction to Chapter 169 of the Laws of 1978 and clarifies the fiscal responsibilities of general contractors to pass on a percentage of each progress payment to a subcontractor that reflects the percentage of that subcontractor's work completed as of the date of the requisition from the owner.
 

1981 HOLD HARMLESS LAW

To prohibit the use of "hold harmless" agreement in the construction industry whereby project owners and general contractors require subcontractors to indemnify them for the partial negligence of such owners and general contractors.
 

1982 LIEN FILING EXTENSION

Extends the time period for filing a Mechanic's Uen on private work from four months to eight months after the last performance of work or last furnishing of materials, except that work or material supplied to a single family dwelling retains a four-month filing period.
 

1983 CONTINGENCY PAYMENT CLAUSE

Deems invalid any contract clause that makes payment from the contractor to the subcontractor contingent upon receipt of payment from the owner to the contractor, unless the contractor has requisitioned such payment within ninety days of substantial completion of the project.
 

1984 PROMPT PAYMENT

Mandated the State agencies pay their bills within 45 days (drops to 30 days in 1988) or face market rate interest penalties.
 

1984 PLAN DEPOSIT REFUND

Allows for non-bidders (including subcontractors) to recoup plan deposit refunds for one set of plans less the actual cost of reproduction of the plans.
 

1985 INTEREST ON DIVERTED TRUST FUNDS

Allows subcontractors to collect interest on diverted trust funds after successfully bringing an action for trust fund diversion against a contractor.
 

1985 INDIVIDUAL ACTIONS ON 
TRUST FUND DIVERSION

Will allow an individual subcontractor, at the discretion of the court, to bring an action to enforce a trust where the total number of trust beneficiaries is so large that joining of all members would be impractical.
 

1986 STATUTE OF LIMITATIONS OF 
TRUST FUND ACTIONS

Extends the statute of limitations on trust fund actions to either one year after the completion of the improvements or one year from the date on which final payment under the subcontractors contract becomes due, whichever is later.
 

1988 TERM OF OWNER-CONTRACTOR CONTRACT

Requires a construction owner, upon request, to provide a subcontractor or supplier the terms of his contract with the prime contractor, within 30 days of such request.
 

1988 LIEN FILING CLARIFICATION

Clarifies the lien law as to when the eight-month period as opposed to the four-month period for filing a mechanic's lien is applicable, by specifically noting that the eight month period applies when the work is being done for a developer of single family dwellings.
 

1989 EXTENSION OF MECHANIC'S LIEN

Allows a mechanic's lien on private property to be extended beyond its one-year duration by filing an extension with the office of the county clerk. It also allows a public improvement lien to be extended beyond its six-month duration by filing an extension with the office of the state comptroller and the financial officer of the public entity.
 

1989 INTEREST PASS-THROUGH OF LATE PAYMENTS

Requires prime contractors to pass through to subcontractors on a pro-rata basis, a share of any interest for late payments received by the prime contractor from the state pursuant to the 1984 prompt payment law.
 

1990 SUBCONTRACTOR PROMPT PAYMENT

Added teeth to the I 5-day payment period between prime contractors and subcontractors on state protects by assessing interest penalties against prime contractors who fail to pay subcontractors within 15 days after receiving payment from a state agency.
 

1990 SIMULTANEOUS NOTICE

Allows the mandatory service of a copy of the notice of lien to the contractor to be made either simultaneously with the filing of such notice with the County Clerk, or within 30 days thereafter.
 

1991 SERVICE OF LIEN BY MAIL

Made clear that lienor may choose from a number of alterative methods of serving a copy of the notice of lien upon the owner in the first instance, without first having to attempt personal service.
 

1992 LOCAL GOVERNMENT PROMPT PAYMENT

Amends section 1.06-b of the General Municipal Law. It requires local governments to pay contractors within 45 days after receipt of an approvable requisition or pay an interest penalty. It also requires contractors that receive interest from a local government to pass along a pro-rata share of such interest to subcontractors. Finally, it requires contractors to pay their subcontractors and suppliers within 15 days of receipt of payment from the public owner or, pay Interest to these subcontractors and suppliers.
 

1992 LIEN ON IDA PROJECTS

Amends section 2 of the Lien Law. It provides contractors, subcontractors and suppliers lien rights on projects financed through Industrial Development Agencies.
 

1993 HOLD HARMLESS TECHNICAL AMENDMENT

This law was enacted in 1993 and made a technical amendment to Section 5-3221 of the General Obligations Law.
 

1995 LOCAL GOVERNMENT PROMPT PAY AMENDMENT

This law makes the local government prompt pay law permanent and has lowered the payment period in most cases from 45 days to 30 days.
 

1996 SERVING NOTICE OF LIEN

This law makes the Lien Law more "user friendly" by allowing a lienor to serve a copy of the Notice of Lien on the owner and/or contractor up to five days prior to filing the Notice of Lien in the County Clerk's Office or with the public owner.
 

2000 LIEN DURATION BILL

This law, effective January 1, 2001, extends the duration of a public improvement lien from six months to one year. The bills provides for a limit on the number of extensions for both private and public improvement liens allowed.
 

2002 LIEN DISCHARGE UNDERTAKINGS 
(Section 21 Lien Law)

Sets the amount of an undertaking required to discharge a lien at 110% of lien amount.  Prior to enactment of this law, undertakings to discharge liens (usually in the form of a bond), were required to be set by a judge with or without a stipulated agreement between the surety providing the bond and the lienor.
 

2002 PROMPT PAYMENT LAW

Applies to private commercial construction projects where the total cost exceeds $250,000.  Exempted from the law are all public works projects and most private residential projects.  Law provides contractors, subcontractors and suppliers with several new prompt payment protections such as statutory interest penalties and the right to stop work for non-payment.
 

2003 TECHNICAL AMENDMENT - DURATION OF

PUBLIC LIENS (Section 21 Lien Law)

Makes Section 21 of the lien law consistent with Section 18 of the lien law, as amended by ESSA in 2000, which extended the duration of public improvement liens from six months to one year.

 

2004 PAYMENT BOND ON HYBRID PROJECTS (Section 5 Lien Law)

Requires payment bonds or other forms of security to be posted by owners on certain "hybrid" construction projects valued at more than $250,000, such as those where a private building is constructed on public land.

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