Condo Media - September 2013 - 16

by David C. Uitti, Esq.
and Kimberly A. Bielan, Esq.

C A I

R e g i o n a l

N e w s

MASSACHUSETTS

Dotted-Line Diligence
What Trustees and Managers Need to Know Before Signing a Contract for Condominium Repairs

H

as your condominium
association been contemplating repair work? Does
your condominium have a
leaky roof that requires patching,
or are you renovating your condominium’s common areas? Before
the trustees sign on the dotted line
and enter into a contract for this
work, they should be aware of the
potential pitfalls of poorly drafted
contracts as well as Massachusetts’
Mechanic’s Lien Statute, M.G.L.
c. 254 §1, et seq.
The statute is designed to protect
contractors, subcontractors, and
laborers in their construction and
renovation of properties. Specifically, the statute provides a remedy
to those professionals who are not
paid for their work. This remedy
includes a statutory mechanic’s lien
against the subject property, as well
as the ability to institute litigation
to enforce the lien to recover for the
costs of the unpaid work.
If a contractor successfully files
and records the requisite documents
to create a mechanic’s lien against
a condominium property, then the
trustees and managers will have to
address the lien, which could prove
costly in funds to pay for litigation
costs, a potential settlement, or
satisfaction of an adverse judgment
in the case.
Because of the common form of
ownership concerning common
areas as set forth in M.G.L. c. 183A,
mechanics liens cannot, as a matter of law, encumber condominium
common areas; instead, valid mechanics liens should only be able to
encumber individual units.
16

Condo Media • September 2013

Before Signing
on the Dotted Line

Trustees and managers should take
the following steps before entering
into a contract for repair work to help
mitigate against an aggrieved contractor ever seeking a mechanic’s lien
against your condominium.

Deﬁne the Scope of Work in Writing. Trustees and managers should
clearly define the scope of work in the
contract and require that any changes
or additions to that scope of work be
agreed upon beforehand, in writing,
and signed by all parties. Clarity as to
the scope of work, and the means by

Ambiguous benchmarks, such as “Payment upon 50
percent completion,” are insufﬁcient because you
could disagree as to when the project is half ﬁnished.
Make Your Contract Precise and
Clear. Be sure that the proposed
written contract is clear in its terms,
especially those terms that address the
scope and schedule of work and timing
and method of payment. All too often
the contractor will draft and provide
a form contract for the association
to sign, and the trustees will sign it
without making any changes. Instead
of doing this, the trustees and managers should first consult an attorney and
amend any suspect provisions and/or
add helpful provisions prior to signing.
The cost for this up-front legal work is
minimal and will often pale in comparison to the costs to defend against
a mechanic’s lien and/or breach of
contract lawsuit and satisfy an adverse
judgment. We have unfortunately
seen too many instances of a condominium association’s trustees signing a
contractor’s form contract, only to be
later subjected to a mechanic’s lien or
related lawsuit due to ambiguities or
deficiencies in the contract that could
have easily been addressed before the
contract was signed.

which that scope can be altered, will
protect the condominium association
from later disagreements concerning
the scope of work, or from a contractor performing unauthorized work
and then falsely claiming in a lawsuit
that the association agreed to it.
Condition Payments Only for Completed Work. The contract should
contain a provision that payment will be
made only for work that has been completed to all parties’ satisfaction. Such
a provision will ensure that the condominium association is paying only for
work that has been performed, and it
will provide the condominium association the opportunity to inspect the work
to verify that it is of the quality that it
has bargained for prior to any payment
being due. Ambiguous benchmarks,
such as “Payment upon 50 percent
completion,” are insufficient because
the condominium association and contractor could disagree as to when the
project is actually half finished. Instead,
the contract should list specific project
benchmarks that clearly set forth and
Condo Media - September 2013

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