Construction contracts can be a minefield, especially when they contain provisions that are unenforceable under Nebraska law. Whether you are a contractor drafting agreements or a subcontractor reviewing terms, it is critical to know what is allowed and what is not allowed. Nebraska Revised Statute 45-1209 outlines several key protections that cannot be waived or altered, no matter what the contract says. This article breaks down those provisions to help you steer clear of costly legal missteps and ensure your rights are protected on Nebraska projects.

Key Provisions of Nebraska Revised Statute 45-1209

1. Waiver of Bond Claims:
   • What It Means: Contractors and subcontractors cannot be forced to waive their rights to file a claim against a payment or performance bond. However, they can provide a waiver or release of such rights as a condition for payment, but only up to the amount they have received.
   • Why It Matters: This provision ensures that contractors and subcontractors retain their ability to seek compensation through bond claims, protecting their financial interests.
2. Nebraska State Law Applies:
   • What It Means: Any contract for construction work in Nebraska must be governed by Nebraska law. Provisions that attempt to apply laws from other states are void.
   • Why It Matters: This provision ensures consistency and predictability in legal matters related to all construction projects where the work is performed in the State of Nebraska, making it easier for contractors and subcontractors to understand their rights and obligations under Nebraska law.
3. Nebraska is the Venue for Legal Proceedings:
   • What It Means: If the scope of work to be performed under the construction agreement is to be performed in the State of Nebraska, then the contract cannot require that court or arbitration hearings be held outside of Nebraska.
   • Why It Matters: This provision ensures that any legal disputes are resolved within the state, making it more convenient and less costly for local contractors and subcontractors to participate in the litigation or arbitration proceeding.

Key Take Aways for Contractors and Subcontractors 

Nebraska Revised Statute 45-1209 protects valuable rights for contractors and subcontractors. By voiding certain contract provisions, the statute helps ensure that contractors and subcontractors can:

• Maintain their rights to bond claims: This is crucial for securing payment and performance guarantees.
• Rely on Nebraska law: This simplifies legal processes and ensures that local laws are applied consistently.
• Resolve disputes locally: This reduces the burden of traveling for legal proceedings, saving time and money.

Examples of Provisions Likely to be Void for Construction Projects Taking Place in the State of Nebraska

• Bond claim provision:
  • “Subcontractor hereby waives any and all rights to file a claim against the general contractor’s payment bond, regardless of whether payment has been received or not.”
  • This provision violates Nebraska Revised Statute 45-1209 because it attempts to waive the subcontractor’s statutory right to make a claim against a payment bond without being explicitly tied to payments received.

• State law provision:
  • “This Agreement shall be governed by and construed in accordance with the laws of the State of Texas.”
  • This provision violates Nebraska Revised Statute 45-1209 because it attempts to apply the laws of a state other than Nebraska, where the project is located.

• Venue provision:
  • “All disputes arising out of or related to this contract shall be litigated exclusively in the courts of Cook County, Illinois.”
  • This provision violates Nebraska Revised Statute 45-1209 because it attempts to require disputes to be resolved outside of Nebraska, where the project is located.

Conclusion

For contractors and subcontractors in Nebraska, understanding and adhering to Nebraska Revised Statute 45-1209 is essential. This statute safeguards their rights and ensures fair treatment in construction contracts. By being aware of these provisions, contractors and subcontractors can better protect their interests and navigate the complexities of construction law in Nebraska.

If you have any questions or need further clarification on this statute, or your contractual rights, please do not hesitate to contact one of the lawyers in our Construction Industry Practice Area.

_{This content is made available for educational purposes only and to give you general information and a general understanding of the law, not to provide specific legal advice. By using this content, you understand there is no attorney-client relationship between you and the publisher. The content should not be used as a substitute for competent legal advice from a licensed professional attorney in your state.}