Tag: Law

In a construction project, many elements come into play: planning, design, financing, materials, contracts, workforce and more. At the end of the day, everyone in the supply chain, from the owner to the supplier, wants to get paid. For credit professionals, the concern is the same.

California Governor Gavin Newsom signed SB 440, or the Private Works Change Order Fair Payment Act, into law on October 10. The law, which goes into effect at the start of 2026, introduces a newly structured process of resolving change-order and time-extension claims on private works of improvement.

Lien and bond rights are essential tools for protecting payments in the construction industry. Whether you’re a general contractor (GC), subcontractor or material supplier, these legal rights provide leverage when payments are delayed or withheld. However, these rights and the processes to enforce them vary significantly from state to state.

California Governor Gavin Newsom signed AB 1521 on October 1, formally defining “trade credit” in state law for the first time and clarifying SB 1286, a bill signed last year that created confusion when it offered small businesses consumer debt protections as it expanded on the Rosenthal Fair Debt Collection Practices Act.

Georgia’s two-step process for pre-lien notices and lien waivers can challenge even the most experienced credit professionals. Missing any key deadline can result in a complete loss of lien rights, regardless of the money owed on construction projects. For example, failing to serve a Notice to Contractor by day 30, even by mistake, can cost you tens of thousands.

In the high-stakes world of construction, securing timely payment is both critical and notoriously challenging for material suppliers, where delayed funds can jeopardize entire operations. To avoid these pitfalls, credit professionals can enforce their lien and bond rights on a project. 

Determining a customer’s creditworthiness is a key responsibility for credit professionals, but the process is complicated by the legal obligations of the Equal Credit Opportunity Act (ECOA) and Regulation B.

Louisiana Governor Jeff Landry signed into effect two new laws reshaping payment protocol during construction projects and expanding on defenses afforded to sureties. The two laws grant sureties a new defense against nonpayment claims previously reserved for general contractors and detail a timeline for material suppliers sending notices for missed payments.