The two cases in this issue, each involving attempts to settle payment disputes, illustrate some of the pitfalls in administering the process.
In the first, a subcontractor was attempting to obtain final payment, but the prime contractor said the sub had not complied with a condition precedent to payment. The prime later offered to release payment without the precondition. The sub argued the condition had been waived. Meanwhile, the prime contractor said it had merely been an offer in compromise that, when not accepted by the sub, became nonbinding and inadmissible.
In the second, a project owner refused to pay a trade contractor for what the owner deemed deficient work. The contractor filed a mechanic’s lien on the property, and the owner argued the meritless lien prevented the owner from converting its costly construction loan into a long-term mortgage loan. The owner sued the contractor for slander of title.
