Kentucky lien waiver: void, except the partial waiver for a progress payment, which the statute names
Kentucky is one of the few states that tells you which waiver is legitimate rather than only which one is not. The rule voids a provision waiving lien rights, then carves out partial waivers given by a contractor or subcontractor for progress payments by name.
A Kentucky construction contract provision that purports to waive, release or extinguish rights under KRS chapter 376, the lien chapter, is against public policy and void, with the exception of partial waivers of lien rights given for progress payments.
Read the law: KRS 371.405codes.findlaw.com
KRS 371.405(2)(b), word for wordFill it in online Type your details in and download it already filled in.A provision that purports to waive, release, or extinguish rights provided by KRS Chapter 376, with the exception of partial waivers of lien rights provided by the contractor or subcontractor for progress payments
KRS chapter 376 is the lien chapter, so the section reaches lien rights by cross reference rather than by name. The lien chapter is not silent about waivers though. KRS 376.070(3) and KRS 376.060 each turn on one, and both are below.
Download a blank Kentucky lien waiver
Kentucky prescribes no statutory wording, so this is the general conditional waiver on progress payment, the form that fits most draws. Print it and fill it in by hand, or use the builder below and get it back already filled in.
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Why the carve out is good news rather than a loophole
It would be unworkable to run a draw schedule with no waivers at all. A lender releasing a draw needs paper showing what the last one bought. Kentucky says so out loud: partial waivers of lien rights given by a contractor or subcontractor for progress payments are outside the prohibition.
What that means in practice is that the partial waiver on a progress payment is the one document the Kentucky statute positively blesses. A blanket waiver, a waiver of everything on the job, or a waiver stuck in the subcontract before any work is done, is not a partial waiver for a progress payment and does not fit the carve out.
So the discipline is simple. One waiver per draw, for that draw's amount, through that draw's date, with everything else in the exceptions box.
The lien chapter does mention a written waiver, twice, and both times it costs you something else
KRS 371.405 is still the section that decides whether a waiver is void, and it is in the contracts title rather than the lien chapter. But the lien chapter is not silent, and the two places it speaks are easy to miss because neither of them is in a section about waivers.
KRS 376.070 is the section that makes a contractor pay out. From the proceeds of any payment received from the owner it has to pay in full everyone who furnished material or performed labor on the property, and pay them pro rata when the payment will not stretch. Subsection (3) then switches the whole duty off: it shall not apply where persons furnishing material or performing labor have waived in writing their right to file mechanics' or materialmen's liens.
KRS 376.060 does the same thing on the owner's side. An owner who sells or mortgages the property before the time for filing a lien has run must, on receiving the sale money or the loan proceeds, pay in full any sum owing for the labor and materials, unless released in writing by the person who furnished them.
So a Kentucky waiver is not only the giving up of a lien. The same piece of paper releases the contractor from the duty to pay you out of the owner's money, and the owner from the duty to pay you out of a sale or a refinance. That is the practical reason to sign a partial waiver for the draw you were actually paid and nothing wider.
The delay damages clause nobody covers
KRS 371.405(2)(d) has nothing to do with liens and belongs on this page anyway, because it is in the same list of void provisions and almost no waiver page mentions it.
It voids a provision purporting to waive, release or extinguish the right of a contractor or subcontractor to recover costs, additional time, damages, or an equitable adjustment of the contract, for delays that are in whole or in part within the control of the contracting entity.
In plain terms, a no damages for delay clause does not work in Kentucky where the delay was the other side's doing. If your job ran four weeks long because the owner could not make a decision, that clause in the contract is not the end of the conversation.
The rest of the section is prompt payment
Subsections (3) through (10) carry the payment machinery: payment timelines running in business days, interest at twelve percent per annum on late amounts, and an obligation on the contractor to pay a subcontractor within a set number of business days after being paid itself.
Subsection (1) limits the whole section to contracts entered into after June 26, 2007, which by now covers any live job but matters on old paper.
Two other provisions in the void list are worth a glance: (2)(a) voids a waiver of the right to litigate, while expressly allowing arbitration to be substituted, and (2)(c) voids a waiver of the KRS 371.160 requirements.
Which of the four to sign on a Kentucky job
The statute protects you from a waiver signed before the work or before the payment. It does not protect you from one worded too broadly, or handed over against a check that later bounces, so the conditional form is still the right default.
Questions people ask
Are lien waivers legal in Kentucky?
Partial waivers given for progress payments are, by name. KRS 371.405(2)(b) voids a provision that purports to waive, release or extinguish rights under KRS chapter 376, with the exception of partial waivers of lien rights provided by the contractor or subcontractor for progress payments.
Where is Kentucky's lien waiver rule?
In the contracts title, KRS 371.405, not the lien chapter. The section reaches the lien rights by referring to KRS chapter 376. Searching the lien chapter alone will not find the rule that voids a waiver, but it does find two sections that say what a written waiver switches off, KRS 376.070(3) and KRS 376.060.
Does Kentucky allow no damages for delay clauses?
Not for delays within the contracting entity's control. KRS 371.405(2)(d) voids a provision purporting to waive the right of a contractor or subcontractor to recover costs, additional time, damages or an equitable adjustment for delays that are in whole or part within the control of the contracting entity.
What is late payment interest in Kentucky?
KRS 371.405 sets interest at twelve percent per annum on amounts not paid within the timelines the section lays out, and requires a contractor to pay its subcontractor within a set number of business days of being paid. Check the current text for the exact day counts on your contract date.
Build the progress payment schedule the partial waivers follow
Working in another state? The general lien waiver forms page covers all four waiver types, and conditional vs unconditional lien waiver explains which of the two to sign and when.
This page quotes KRS 371.405 and explains what it says. It is not legal advice, and a statute can be amended. Read the linked section before you rely on it.