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Unless you’ve been very lucky as a tradesperson or contractor, you’ve probably dealt with trying to get paid. The unfortunate fact is that there are project owners out there that are slow to pay – or don’t pay at all.
To protect contractors and other craftspeople, every state offers legal recourse through a mechanic’s lien. To take advantage of this protection, though, there are a series of steps you’ll need to follow, no matter where you live. One common, and critically important element in most states is providing preliminary notice.
Preliminary notice is a notification to the owner or general contractor of a construction project to notify them that a contractor, sub-contractor, materials provider, or other party is reserving their right to file a mechanic’s lien in the event of non-payment.
The notice itself is not a mechanic’s lien. Instead, it is notification that is used to preserve the right to file a lien, should the need arise. In states where preliminary notice is required, failure to send notice can cost you your right to file a mechanic’s lien later.
Depending on where the project is executed, a preliminary notice may also be called a Materialmans Notice to Owner, a Notice of Furnishing, or simply a Notice to Owner.
Not every state requires preliminary notice, but the majority do. Forty states currently require preliminary notice to be filed to preserve your rights to file a mechanics lien at a later date.
It’s important to do the research for your state to understand what is required for notice. While most states require notice, many requirements are unique in timing and execution.
The timing of your notice is typically dependent either on when you began working or the last day you provided services to a project. You could be required to file within 10 days of beginning work, or up to 120 days from your last day on the job site. It all depends on the laws in the state where the job is located.
For instance, in Texas, when you send notice is dependent on your role on the job, and for most craftspeople, several notices must be sent. In California, notice must be filed 20 days after work begins.
If the construction project is in a state that doesn’t require notice, you can still file a lien if you don’t get paid.
But if you’re in one of the forty states that does require notice, and you failed to file, you have more than likely lost your right to file a mechanic’s lien.
However, if you’re just finding out now that you’ll need to provide preliminary notice and you’re still providing services for the job, all is not lost. Late filing might mean you lose out on your rights for some work, but preserve your lien rights for any work done within the notice window.
BICA can assist you with all of your notice needs. Learn more about our lien services.