When work on a construction project has been completed, the contractor will present an affidavit certifying that the work has been done and payment for such work is due. Affidavits are presented for both progress payments and when the final payment is due. The content of the payment affidavit will generally include a statement to the effect that the contractor has paid its subcontractors and suppliers. If the contractor misrepresents information in the payment affidavit, he may be liable for criminal penalties arising out of such false swearing.
The affidavit for final payment is one of the owner's tools for protecting itself against liens on the property. Basically, the contractor must certify that it has paid all its outstanding bills associated with work on the project and that no indebtedness remains for which the owner may be held responsible. When a progress payment affidavit is executed, a lien waiver is generally issued that covers all payments except for those in the future. Sometimes, an owner may demand a waiver for future liens. Though there are contractors willing to agree to such a waiver, the risk of doing so given the owner's future payment obligations can be high.
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