Weize Co. v. Colorado Regional Construction, Inc.
251 P.3d 489 | Colorado Court of Appeals | 2010
What This Case Means for Subcontractors
A Colorado general contractor (CRC) failed to pay a plumbing subcontractor (Weize) and supplier (Martz) for completed work. When CRC tried to use a lien release bond to avoid trust fund obligations, the court rejected this defense. The court ruled that lien release bonds do not excuse contractors from holding money in trust for subs and suppliers, and awarded treble damages plus interest to the unpaid parties.
Key Takeaways
- •A lien release bond does not protect a general contractor from trust fund statute violations—you can still pursue treble damages even if a bond was posted.
- •Always record a lis pendens (notice of your lien claim) promptly or you may lose your lien foreclosure rights, even if you have other valid claims.
- •General contractors must hold funds in trust for subcontractors and suppliers regardless of bonding arrangements—this is a non-negotiable legal obligation in Colorado.
A lien release bond is not equivalent to payment or performance bonds under the trust fund statute.
Frequently Asked Question
If a general contractor posts a lien release bond, can they avoid paying me as a subcontractor?
No. A lien release bond does not excuse a contractor's legal obligation to hold funds in trust for subcontractors and suppliers under Colorado law. You can still pursue treble damages and attorney fees even if a bond was posted. Always record a lis pendens promptly to protect your lien foreclosure rights.
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