Opinion ID: 900889
Heading Depth: 1
Heading Rank: 19

Heading: Action Mechanical

Text: [¶ 45.] A contractor may waive the right to file a mechanic's lien. Peterson Mechanical, Inc. v. Nereson, 466 N.W.2d 568, 571 (N.D.1991). Lenders typically demand lien waivers before disbursing more proceeds on construction loans to avoid misapplication of funds by contractors who fail to pay suppliers. See Larson Concrete Co. v. Stroschein, 353 N.W.2d 354, 361 (S.D.1984) (Fosheim, J., dissenting). Here, Action Mechanical signed a lien waiver for 50,000 shares of stock valued at $50,000. The lien waiver was dated December 29, 1995. At that time, Action Mechanical's unpaid bill was $162,394. Four Square contends Action Mechanical waived the entire $162,394 in exchange for the 50,000 shares of stock. [¶ 46.] Resorting to the language in the lien waiver shows that it was a partial waiver to the extent of the value of the shares received. The shares were valued at one dollar each making $50,000 for 50,000 shares. The waiver specifically states said stock being partial payment of all demands. Therefore, by its own terms, the waiver only satisfied $50,000 of Action Mechanical's bill, not the entire $162,394 owed at the time.