STOP! Don’t Sign That Release Unless It Says This – Florida Webinar by Alex Barthet

Many contractors, subcontractors, and suppliers treat releases as routine paperwork. They sign them quickly to receive payment and move on. Unfortunately, this habit can lead to serious financial consequences. A single release, signed without proper attention, can result in lost payments, waived claims, and limited legal options.

In this webinar, presented by SunRay Construction Solutions and Alex Barthet, Principal, The Barthet Firm, we break down how releases actually work, what risks they carry, and how you can protect yourself every time you sign one.

Understanding the True Nature of a Release

A release is not a receipt. It is not just confirmation of payment. It is a legally binding contract. When you sign a release, you are making formal declarations about your rights and payments. Depending on how the document is written, you may be confirming that you have been fully paid, even if that is not true in reality.

This is where most problems begin.

Many construction professionals assume that if they have not received full payment, they can always recover the balance later. However, the wording of the release may legally contradict that assumption. Once signed, the release becomes enforceable. Courts will rely on the language of the document, not your expectations or verbal understanding.

Why Your Position in the Contract Chain Matters

One of the most important insights is that your approach to releases must change depending on your role in the project. Construction operates in a layered structure. Payments flow from owners to general contractors, then to subcontractors, and further down to sub-subcontractors and suppliers. Because of this structure, you often play two roles at the same time.

When You Are Receiving Payment

If you are a subcontractor receiving payment from a general contractor, your goal is to protect your rights.

You should:

• Limit what you are giving up  

• Preserve claims for unpaid work  

• Avoid broad or vague language  

When You Are Making Payment

If you are paying a subcontractor or supplier, your goal shifts.

You want:

• Maximum protection  

• Assurance that no future claims will arise  

• A clean financial closure for that period  

This dual perspective is critical. You must understand how releases work both upward and downward in the payment chain.

Types of Releases and What They Mean for You

Florida Statutory Releases

Florida law provides standard release formats under Chapter 713.20. These are designed to create clarity and fairness.

Progress Payment Release

This type of release:

• Covers work completed up to a specific date  

• Includes a clearly defined through date  

• Does not apply to future work or retention  

The through date is the key element here. It defines the exact time period you are releasing your lien rights for.

Final Payment Release

This is used at the end of the project.

It:

• Covers all work completed  

• Does not include a through date  

• Becomes effective on the date you sign it  

At this stage, you are confirming that all obligations have been fulfilled and no further payments are expected.

Why Statutory Releases Are Safer

Statutory releases are limited in scope. They typically:

• Only waive lien rights  

• Do not include broad claims  

• Are easier to interpret  

For subcontractors and suppliers, these are generally the safest option.

Custom or Broad Releases

Custom releases are not defined by statute. They are usually drafted by general contractors or owners and are designed to provide broader protection. These documents often include language that goes far beyond lien rights.

They may require you to waive:

• All claims related to the project  

• Pending change orders  

• Delay damages  

• Additional costs or fees  

They may also require you to confirm:

• That all bills have been paid  

• That work complies with contract requirements  

• That no disputes exist  

This transforms the release into a much more powerful legal document. Signing such a release without careful review can eliminate rights you did not intend to give up.

The Most Critical Concept: The Through Date

The through date is the most important element in any release.

It determines the time-period for which you are confirming payment has been made.

Why It Matters

When you sign a release with a through date, you are stating that you have been paid in full for all work performed up to that date. This statement is legally binding.

A Real-World Scenario

Consider this situation: You submit a payment request for 10,000 for work completed through the end of March. You receive only 8,000. The release you are asked to sign states that it covers work through March 31.

If you sign this release, you are legally confirming that you have been fully paid for all work through March 31. The remaining $2,000 is no longer protected.

Why This Happens

The legal system relies on the wording of the release. The through date represents the scope of payment coverage. If the date extends beyond the amount, you actually received, you effectively waive your right to claim the difference.

How to Handle This Situation

You have three options:

1. Adjust the through date to match the payment received  

2. Add a clear exception for the unpaid amount  

3. Refuse to sign until full payment is made  

What you should never do is assume the balance will be handled later.

Conditional Releases and Why They Are Essential

A conditional release is designed to protect you when payment has not yet been secured. In many situations, you may be asked to provide a release before you actually receive funds. This creates a risk.

How Conditional Releases Work

A conditional release includes language stating that the release is not effective until payment is received.

This ensures that:

• Your rights remain intact until funds are cleared  

• The release only becomes valid after payment is confirmed  

Situations Where You Must Use Conditional Language

• When you receive a copy of a check but not the actual payment  

• When a check has not cleared  

• When payment is promised but not delivered  

• When you are asked to email a signed release in advance  

The Risk of Not Using It

If you provide an unconditional release before receiving payment:

• The document may be used to show that you have been paid  

• The owner may rely on it as proof of payment  

• Your lien rights may be lost  

Even if you later pursue legal action, your strongest leverage may already be gone.

Common Misunderstandings

Some releases are labeled as conditional but do not include actual conditional language. These are not true conditional releases. Always read the content carefully. Another mistake is using a nominal amount such as $10 in the condition. This defeats the purpose of the condition. The condition must reflect the actual amount you expect to receive.

The Role of Placeholder Amounts

Many releases include a nominal amount such as $10. This is often used for:

• Administrative simplicity  

• Avoiding disputes over exact amounts  

• Maintaining confidentiality in fixed price contracts  

However, this approach can create problems.

If you are expecting a specific payment, the release should reflect that amount. This provides clarity and strengthens your position in case of a dispute.

Fixing Release Issues Before They Start

The best time to address release risks is during contract negotiation. Many contracts include pre-approved release forms that you are required to use. These forms are often broad and unfavorable.

What You Should Do

Before signing a contract:

• Review all release forms included in the agreement  

• Negotiate the use of statutory releases  

• Ensure conditional language is allowed  

• Confirm that you can include exceptions  

Why This Is Important

Once the contract is signed, your ability to modify release terms becomes limited. By negotiating upfront, you ensure that every future payment interaction is based on fair and predictable terms.

Protecting Ongoing Claims with Exceptions

If you have unresolved issues such as:

• Pending change orders  

• Delay claims  

• Disputed invoices  

You must exclude them from your release. This requires a clear and specific language. Without these exclusions, you risk waiving those claims permanently.

Practical Best Practices for Every Project

To consistently protect your rights:

• Read every release carefully before signing  

• Do not rely on assumptions about future payments  

• Ensure payment and time-period always align  

• Use conditional releases whenever payment is uncertain  

• Replace placeholder amounts with actual values when necessary  

• Negotiate release terms at the contract stage  

• Keep clear documentation of all claims and exclusions  

Key Takeaways

• A release is a legal contract with serious consequences  

• Your role in the project determines your release strategy  

• Statutory releases are generally safer than custom ones  

• The through date defines what you are giving up  

• Conditional language protects you from non-payment  

• Small mistakes can lead to significant financial loss  

Final Thoughts

In construction, your ability to get paid depends not only on the work you perform but also on the documents you sign.

Releases are one of the most powerful documents in this process. They can either protect your rights or eliminate them.

The difference lies in how carefully you review and manage them. Take the time to understand what you are signing. Align every release with actual payment. Use conditional language when needed. And most importantly, never treat a release as routine paperwork. It is a contract that directly impacts your bottom line.

Common Questions Contractors Ask

1. Why does a release form sometimes show $10?

The $10 mentioned in a release is usually just a placeholder amount. It does not reflect the actual payment being made. Instead, it is used for administrative or legal convenience in certain situations.

2. Is $10 a standard or required amount in releases?

No, $10 is not a standard or mandatory amount. It is simply a nominal value that parties may choose to use instead of listing the actual payment amount.

3. Why do contractors prefer using $10 in releases?

There are strategic reasons for using $10 in releases. For example, if a contractor is making a payment and receiving a release, using $10 can help avoid disputes later about the exact payment amount. It prevents arguments where a party claims they expected a higher payment.

4. Should I replace $10 with the actual amount when receiving payment?

Yes. If you are signing a release and expecting payment, it is generally better to replace $10 with the actual amount you expect to receive. This strengthens your position if there is a payment dispute later.

5. What happens if I sign a release with $10 but receive less than expected

If the release says $10 and there is a dispute, it may be harder to argue that you expected a higher amount. That is why it is recommended to write the actual expected payment amount in the release.

6. Are there valid situations where using $10 makes sense?

Yes, there are a few common scenarios:

• When no payment is actually due for that period  

• When a release is required for administrative purposes after sending a notice  

• In fixed price contracts where contractors want to prevent owners from tracking subcontractor payments  

7. Does it matter if a release says $10 instead of the actual amount?

It depends. If you receive the full amount you expected for the period covered, then it may not matter. However, if there is any shortfall or dispute, using $10 can weaken your position.

8. Can I add conditional language to any release

Yes. You can add conditional language to any release, including those provided by a general contractor. This can be done by stamping or writing directly on the document.

9. What if the other party refuses to accept changes to the release

Some parties may resist modifications. In such cases, the outcome depends on your contract terms. However, lien laws generally allow you to condition a release upon actual receipt of payment, which can help support your position.

10. Does a $10 release protect me if I have not been fully paid

No. The amount written in the release is less important than whether you received the full payment for the period covered. Your protection depends on whether the payment matches the scope of the release.

11. Can a $10 amount be used in a conditional release

No. A conditional release should always include the actual amount expected. Using $10 in a conditional clause makes the condition ineffective.