Construction Lawyer in New York City

What a construction lawyer does, and the disputes Reza Yassi handles

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A construction lawyer resolves payment, contract and lien disputes among the people who build and pay for a project. Reza Yassi handles disputes over:

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• Unpaid progress payments, final payments and retainage

• Filing, foreclosing, bonding and discharging mechanic's liens

• Lien Law article 3-A trust fund claims, brought for all trust beneficiaries, against those who diverted the money

• Change orders, extra work and delay claims

• Defective work, substantial completion and terminations

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Most construction contracts say how disputes are resolved, often by mediation or arbitration; otherwise the case usually goes to New York State Supreme Court. General breach of contract rules apply too; this page, part of the firm's commercial and civil litigation practice, covers the construction statutes. Hurt on a job site? See construction and workplace accidents.

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Mechanic's liens in New York: who can file and what the notice must say

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A mechanic's lien is a claim against the improved property itself. A contractor, a subcontractor at any tier, a laborer or a material supplier who improves real property with the owner's consent, or at the request of the owner or its contractor or subcontractor, can file one for the unpaid price or value of the work (Lien Law § 3). Lienable work includes plans, specifications and surveys an architect, engineer or surveyor prepares for the improvement (Lien Law § 2(4)). A subcontractor's lien is limited to what is earned and unpaid on the upstream contract when the lien is filed, plus later earnings (Lien Law § 4).

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The verified notice must state, among other things, the owner, who hired you, the work and its price, the amount unpaid, the dates of the first and last work, and the property, including whether it is a single-family dwelling (Lien Law § 9).

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An advance waiver of lien rights in a contract is void; a written waiver given with or after payment is allowed (Lien Law § 34).

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How long you have to file a mechanic's lien in New York

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During the work, and no later than eight months after your last work or materials on most private projects (Lien Law § 10). The clock runs from the last work actually performed, not your last invoice. Other deadlines:

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• Single-family dwelling: four months.

• Retainage: within 90 days after the retainage was due to be released.

• Filing: with the county clerk where the property is located.

• Service: within five days before or 30 days after filing, serve the owner (Lien Law § 11) and send a copy by certified mail to whoever hired you and, if that was not the general contractor, to the general contractor (Lien Law § 11-b). File proof of service with the county clerk within 35 days after filing, or the lien ends.

• Public projects follow a separate procedure (Lien Law § 12); this page covers private work.

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How long does a mechanic's lien last in New York?

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One year from filing, unless within that year you start a foreclosure action and file a notice of pendency, or file a one-year extension with the county clerk. A single-family dwelling lien can be extended only by court order, and later continuances also need court orders (Lien Law § 17).

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Each county clerk keeps a lien docket, where a lien search is done. Filing first gives no priority over other mechanic's lienors, who generally share on parity (Lien Law § 13).

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How to discharge, bond or vacate a mechanic's lien

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An owner or contractor facing a lien has several tools (Lien Law § 19):

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• Release: the lienor files an acknowledged satisfaction or release with the county clerk (§ 19(1)).

• Bond: a bond for 110% of the lien moves it off the property and onto the bond (§ 19(4)).

• Deposit: before a foreclosure suit, deposit the amount claimed plus interest with the county clerk (Lien Law § 20).

• Summary discharge: a court can cancel a facially defective lien, such as an untimely one (§ 19(6)).

• Demand to foreclose: a served notice gives the lienor at least 30 days to sue or show cause why the lien should not be cancelled (Lien Law § 59).

• Itemized statement: on written demand the lienor owes a verified breakdown within five days (Lien Law § 38).

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If a court declares a lien void for willful exaggeration, the lienor owes the owner or contractor the bond premium, reasonable attorney's fees for clearing it and the overstated amount (Lien Law § 39; § 39-a).

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New York's Prompt Payment Act: deadlines, interest and the right to suspend work

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The Prompt Payment Act (General Business Law article 35-E) sets payment deadlines on private construction projects costing $150,000 or more. It excludes public works, one- to three-family homes and certain other residential projects (GBL § 756).

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• Approval: an invoice with the required documents must be approved or disapproved within 12 business days, with a written statement of rejected items (GBL § 756-a).

• Payment: the owner pays within 30 days of approval; the contractor pays each subcontractor's share within seven days after receiving good funds.

• Interest: 1% a month on late payments, or a higher contract rate (GBL § 756-b).

• Suspension: after at least 10 calendar days' written notice of unpaid undisputed amounts, a contractor or subcontractor may suspend work without being in breach.

• Expedited arbitration before the American Arbitration Association if a written complaint fails.

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Clauses that bar suspension, waive expedited arbitration, change the Act's payment terms or send the dispute to another state's law or courts (except supplier contracts) are void (GBL § 757).

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Retainage in New York: the 5% limit

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Retainage is a share of each progress payment the owner holds back until the work is finished. On a project covered by the Prompt Payment Act, a contract signed on or after November 17, 2023 may hold back no more than 5% of the contract sum, and no contractor or subcontractor may hold back more than the owner does (GBL § 756-c; chapter 657 of the Laws of 2023, § 3). The owner must release it within 30 days after final approval of the work, with 1% a month interest when any tier pays it late.

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Contracts signed before that date keep the old rule: "a reasonable amount" by mutual agreement. Since December 19, 2025, a clause requiring more than 5% is void (GBL § 757(5), added by chapter 654 of the Laws of 2025); the Governor's approval memorandum says it applies only to contracts entered into after November 17, 2023. Many contract forms hold 10%. On private projects outside the Act, the contract controls.

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Is pay-if-paid enforceable in New York? Pay-if-paid vs. pay-when-paid

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Usually not. A pay-if-paid clause makes the owner's payment a condition precedent to the subcontractor's payment, shifting the risk of the owner's default down the chain. New York's highest court held such a clause void under Lien Law § 34 because it effectively waives the subcontractor's right to enforce its lien (West-Fair Elec. Contrs. v Aetna Cas. & Sur. Co., 87 NY2d 148 (1995)).

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A pay-when-paid clause that only sets the time for payment is enforceable, but it does not postpone payment indefinitely if the owner never pays, and courts read it as a timing clause unless the contract expressly makes owner payment a condition.

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Lien Law article 3-A trust funds: when officers are personally liable

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Construction loan and mortgage proceeds an owner receives for a project, and payments a contractor or subcontractor receives under its contract, are trust funds for those who did the work (Lien Law § 70). A contractor's trust funds must pay subcontractors, laborers, suppliers and related costs (§ 71); spending them on another project or overhead first is a diversion (Lien Law § 72). You are a beneficiary even without a valid lien (§ 71(4)).

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• Books: the trustee must keep trust records (Lien Law § 75); once your claim has been payable for 30 days, a written demand gets you access within 10 days (Lien Law § 76).

• Personal liability: officers who knowingly take part in a diversion can be held personally liable. Diversion can also be larceny, and missing books are presumptive evidence of it (Lien Law § 79-a).

• Deadline: an action for all beneficiaries, within one year after completion or, for a subcontractor or supplier, one year after its final payment was due, whichever is later (Lien Law § 77). See the guide to trust fund diversion claims.

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Change orders, extra work and delay claims

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Change-order fights usually turn on the contract's procedure: who may order extra work, in what form, and how fast a claim must be noticed. If the contract bars oral changes, a change generally needs a writing signed by the party it is enforced against (General Obligations Law § 15-301).

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A no-damages-for-delay clause limits a contractor to extra time and is generally enforced, except for delay caused by bad faith or willful or grossly negligent conduct, delay the parties did not contemplate, delay so long it amounts to abandonment, and delay from breach of a fundamental obligation (Corinno Civetta Constr. Corp. v City of New York, 67 NY2d 297 (1986)). See how New York construction delay claims work.

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Termination, substantial completion and defective work

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Follow the contract's notice-and-cure steps before terminating for cause; skipping them can make the termination ineffective. Under the Prompt Payment Act, contracts signed on or after November 17, 2023 allow a final invoice at substantial completion (GBL § 756-a(2)(a)). An owner's contract claim for defective work generally has six years (CPLR 213(2)), usually from completion of the work, and contracts often shorten it.

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What to do when a construction project stops paying

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1. Read the payment, notice, retainage, termination and arbitration clauses.

2. Calendar the lien deadline from your last day of work.

3. Send Prompt Payment Act and contract notices by the required method.

4. Demand the trust books under Lien Law § 76 if money seems diverted.

5. Keep daily reports, emails and delivery tickets, and sign lien waivers only for amounts paid.

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Once a claim becomes a judgment, see collecting unpaid invoices and judgments.

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What a construction lawyer costs, and how to choose one

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Most commercial matters, including construction disputes, are billed at $450 an hour under a written engagement letter; contingency or hybrid fees are exceptions for special cases. The first consultation with Reza Yassi is free.

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Rankings do not tell you who will handle your file. Ask who will, and what each stage will cost against what you can collect.

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Guides on this topic

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• How to file or fight a New York mechanic's lien: deadlines, defects and discharge tools in a lien fight.

• Lien Law article 3-A trust fund diversion: how subcontractors hold a general contractor's officers personally liable.

• New York construction delay claims: how no-damages-for-delay clauses, notice and records decide a delay case.

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Frequently asked questions

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How long do you have to file a mechanic's lien in New York?

Eight months after your last work or materials on most private projects, four months for a single-family dwelling (Lien Law § 10). Serve it within 30 days after filing; file proof within 35 (§§ 11, 11-b).

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How long does a mechanic's lien last in New York?

One year from filing, unless the lienor sues to foreclose and files a notice of pendency, or files a one-year extension; a single-family lien needs a court order to extend (Lien Law § 17).

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How do I remove a mechanic's lien in New York?

Get a filed release, bond the lien at 110%, or deposit the amount claimed with the county clerk (Lien Law §§ 19, 20). A demand to foreclose (§ 59) or a motion against a facially defective lien also works.

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Is pay-if-paid enforceable in New York?

Generally not, because a clause making owner payment a condition precedent effectively waives lien rights (West-Fair, 87 NY2d 148). A pure timing (pay-when-paid) clause is enforceable but cannot postpone payment forever.

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What is the retainage limit in New York?

5% of the contract sum on private projects covered by the Prompt Payment Act, for contracts signed on or after November 17, 2023, released within 30 days after final approval (GBL § 756-c). Older contracts allow "a reasonable amount"; projects outside the Act follow the contract.

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What is the New York Prompt Payment Act?

General Business Law article 35-E covers private construction projects of $150,000 or more and sets invoice approval and payment deadlines, 1% monthly interest, a right to suspend work after written notice, and expedited arbitration.

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Can a subcontractor sue the general contractor's officers personally?

Yes, if they knowingly took part in diverting article 3-A trust funds. The claim is brought for all trust beneficiaries within the one-year deadline in Lien Law § 77, and Reza Yassi handles these claims.

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Owed money on a project as a contractor, subcontractor, supplier or design professional, facing a lien, or defending a payment claim? Gather the contract, the requisitions and a short timeline, then send an inquiry or call (646) 992-2138 for a free consultation with Reza Yassi.