The Conditional Waiver And Release Of Lien is a critical document in the UAE construction and development industry, used to manage payment-related risks and lien rights throughout the project lifecycle. This document is typically required when contractors, subcontractors, or suppliers receive progress payments or final payments for their work or materials. It provides a balanced approach by protecting the paying party's interests while ensuring the payee maintains their lien rights until payment is actually received. The document must comply with UAE Federal Law No. 5 of 1985 (Civil Code) and relevant Emirates' regulations regarding contractors' rights and property encumbrances. It is commonly used in conjunction with payment applications, particularly in large-scale construction projects, and forms an essential part of the project's payment documentation system.
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1. Parties: Identification of the party giving the waiver (typically contractor/subcontractor) and the party receiving it (typically owner/contractor)
2. Background: Brief description of the project, the original contract, and the context for the lien waiver
3. Definitions: Key terms used in the document including 'Lien', 'Project', 'Contract', 'Payment Amount', and 'Effective Date'
4. Payment Acknowledgment: Details of the payment amount that triggers the waiver, including invoice references and payment terms
5. Scope of Waiver: Specific description of the lien rights being waived and the work/materials covered by the waiver
6. Conditional Release: Clear statement that the release only becomes effective upon receipt of the specified payment
7. Representations and Warranties: Statements confirming the waiving party's authority and that no assignment of lien rights has occurred
8. Governing Law and Jurisdiction: Specification of UAE law as governing law and relevant Emirates' courts' jurisdiction
1. Reservation of Rights: Section preserving rights for retention amounts, unresolved claims, or pending change orders - used when there are outstanding issues
2. Subcontractor Confirmation: Confirmation that all subcontractors and suppliers have been paid - used when the waiving party has subcontractors
3. Previous Payments: Acknowledgment of prior payments received - used for progress payments rather than final payment
4. Notarization Section: Space for notary attestation - used when notarization is specifically required by the contract or local requirements
5. Language Provision: Clause specifying which language prevails if the document is bilingual - used when Arabic translation is provided
1. Schedule A - Project Details: Detailed description of the project including location, contract numbers, and scope of work
2. Schedule B - Payment Details: Breakdown of the payment amount, including any relevant invoices and payment applications
3. Schedule C - Outstanding Claims List: List of any excluded or reserved claims not covered by the waiver
4. Appendix 1 - Supporting Documents: Copies of relevant invoices, payment applications, and other supporting documentation
5. Appendix 2 - Authority Documents: Corporate authority documents proving signatory's authority to execute the waiver
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