Contractual lien waivers outlawed in Tennessee starting July 1

State’s ASA members called for the reform in May

Starting July 1, contractual lien waivers will be illegal in Tenneesee. After American Subcontractors Association (ASA) members in the state called for reform on May 19, Gov. Phil Bredesen (D) signed H.B. 743, amending Section 66-11-124 of the Tenneesee Code to state that “Any contract provision that purports to waive any right of lien under this chapter is void and unenforceable as against the public policy of this state.”

ASA of Middle Tennessee government relations chairman Robert E. Lee explained that Tennessee subcontractors wanted to put an end to the practice of contractual lien waivers because they felt subcontractors and contractors were being manipulated out of the security that mechanics liens provide. “The importance of the legislation is that by state law, subcontractors can’t lose their rights to file mechanic’s liens just by agreeing to take on work,” Lee says.

Rep. Charles Curtiss (D-43) introduced the legislation in the Tennessee House, and Sen. Don McLeary (D-27) introduced the companion bill in the Senate. After legislators viewed examples of contractual lien waivers the legislation passed both chambers unanimously.

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