Monthly Archives: April 2010


Delaware Mechanics Lien Filing “How To”

Liens filed on private property or on funds relating to a public project are known as Mechanics’ Liens. When a lien is filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property.

Contractors who have a contract with an owner as well as subcontractors and suppliers who have a contract with a contractor can file a lien. Design professionals may also file liens.

Delaware is one of those States where filing a construction lien is difficult.  To file a mechanics lien, claimants must petition the court in which the property is located.  While Delaware claims to have two ways of doing this, both ways are just as time consuming and expensive.  For corporations, the court will not accept verified mechanics lien statements or petitions to file a mechanics lien unless the corporation is represented by an attorney.  The cost factor, therefore, rises dramatically, as does the waste of time factor.

Prior to filing a Delaware Mechanics Lien, a Notice of Intent to Lien should be served on the Owner.  While not required, it does often have the effect that a lien would have.

If you have served a Notice of Intent to File a Delware mechanics lien claim and no resolution is reached, you should then petition the court to permit the filing of a mechanics lien claim.  A contractor who (1) has contracted directly with the owner or reputed owner of a building and (2) has furnished both labor and material for such structure, must file its statement of claim not less than 90 nor more than 120 days following the completion of the structure.

All other persons must file their statement of claim within 120 days from the last date they provided labor or materials for the Project.

Note that to file a Delaware mechanics lien claim, you do not need a written contract.  In fact, implied contracts are sufficient if you have sufficient documentation to show the existence of an agreement.

The purpose of filing a Delaware mechanics lien is to help the claimant collect the money that is owed on the project.  On a private project, the mechanics’ lien places an encumbrance on the property that makes it difficult to resell or re-finance the property without first removing the lien.

For public projects, Delware does not normally allow construction lien filings.  Instead, most public projects are required to have a payment bond in place for the benefit of subcontractors and suppliers.  For public projects, there are a couple of things that you can do to protect yourself that are as, if not more, effective than filing a lien claim.  Those two things are filing a Stop Notice and filing a payment bond claim.

A Stop Notice is a notification that has the ability to enhance the effectiveness of a mechanic’s lien.  A Stop Notice, or a notice to withhold funds, is sent to the company that is financing or funding the construction funds for a project.  Once that company receives the Stop Notice, that company has notice that it should withhold sufficient money to satisfy the stop notice claim.  The purpose of the Stop Notice is to provide the lender, financiers or funders of the construction project notice that there is money owed to a contractor, subcontractor or supplier so that an inquiry can be made as to why that money is not being paid.

Bond claims can only be filed on a project where the owner, contractor or subcontractor have obtained a payment bond to ensure that every contractor receives payment for the work performed on the Project.  The payment bonds issued by sureties for construction projects have specific timing requirements, but most require claimants to submit claims against the bond within sixty to ninety days from the claimants’ last date of work.  Bond claims as or more effective than a lien claim because the payment bond acts as a guarantee that payment will be made for work properly completed.

For more information on filing a Delaware Construction Lien, a Delaware Mechanics Lien, a Delaware Stop Notice, a Delaware Bond Claim, or a Delaware pre-lien notice (notice of intent to file lien), please visit http://www.lienitnow.com/delaware-faq.asp.

Rules for Vermont Mechanics Liens

Liens filed on private property or on funds relating to a public project are known as Mechanic’s Liens. In Vermont, when a construction lien is filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property.

Contractors, as well as subcontractors, sub-subcontractors and suppliers who have a contract with a general contractor or a subcontractor can file a Vermont mechanics lien.

Unlike other states, Vermont does not have a system requiring claimants to file a pre-lien notice prior to actually filing a lien.  The absence of this step does make it easier to file a mechanics lien claim in compliance with the law.

With regard Vermont Mechanics’ liens, if the property on which the mechanics lien is to be filed is on private property, the lien must be filed within 180 days of the last date the lienor provided materials, labor or services to the Project.

You must have a contract to file a Vermont construction lien.  However, the contract need not be in writing; oral contracts are sufficient if you have sufficient documentation to show the existence of an agreement or that you performed the work for which you are liening.

Filing a mechanics lien can help you get payment.  On a private project, the mechanics’ lien places an encumbrance on the property that makes it difficult to resell or re-finance the property without first removing the lien.

Another way to obtain payment is to file a Stop Notice.  A Stop Notice is a notification that has the ability to enhance the effectiveness of a mechanic’s lien. A Stop Notice, or a notice to withhold funds, is sent to the company that is financing or funding the construction funds for a project. Once that company receives the Stop Notice, that company has notice that it should withhold sufficient money to satisfy the stop notice claim. The purpose of the Stop Notice is to provide the lender, financiers or funders of the construction project notice that there is money owed to a contractor, subcontractor or supplier so that an inquiry can be made as to why that money is not being paid.

On public projects, mechanics liens are generally not permitted.  However, on most public projects, State law requires that the general contractor post a payment bond at the beginning of the Project.  Bond claims can only be filed on a project where the owner, contractor or subcontractor has obtained a payment bond to ensure that every contractor receives payment for the work performed on the Project.  The payment bonds issued by sureties for construction projects have specific timing requirements, but most require claimants to submit claims against the bond within sixty to ninety days from the claimants’ last date of work.  Bond claims are as or more effective than a lien claim because the payment bond acts as a guarantee that payment will be made for work properly completed.

For more information on filing a Vermont Construction Lien, a Vermont Mechanics Lien, a Vermont Stop Notice, a Vermont Bond Claim, or a Vermont pre-lien notice, please visit http://www.lienitnow.com/connecticut-faq.asp.

Connecticut Mechanics Lien “How To”

Liens filed on private property or on funds relating to a public project are known as Mechanics’ Liens. When a lien is filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property.

Contractors who have a contract with an owner as well as subcontractors and suppliers who have a contract with a contractor can file a Connecticut mechanics lien. Design professionals may also file connecticut construction liens.

Prior to filing a mechanics lien, some contrators should file a pre-notice, letting the owner know that you are eligible to file a construction lien.  A notice of intent to lien is required for those who do not have a direct agreement with the owner for the work or materials/services provided.  A Notice of intent to lien should be served after work has commenced, but no later than 90 days after work has ceased.

With regard to the Connecticut construction lien itself, on private property it must be filed within 90 days of the last date the lienor provided materials or services to the Project.  This includes punch list work, and work related to the completion of the contract.  It does not necessarily include repair work.

Filing a mechanics lien in Connecticut can help you get paid because it places an encumbrance on the property that makes it difficult to resell or re-finance the property without first removing the lien.  This provides incentive to the owner to make sure all claimants are paid.

For more information on filing a Connecticut Construction Lien, a Connecticut Mechanics Lien, a Connecticut Stop Notice, or a Connecticut pre-lien notice, please visit http://www.lienitnow.com/connecticut-faq.asp.

Virginia Mechanics Lien “How To”

Liens filed on private properties are known as Mechanics’ Liens in the state of Virginia. A lien that is filed with regard to work performed on privately owned property attaches to and encumbers the fee simple ownership of property.  Mechanics liens can help you get your money because on a private project, the mechanics’ lien places an encumbrance on the property that makes it difficult to resell or re-finance the property without first removing the lien.

All persons providing labor or materials worth $50 or more for the construction, repair, or improvement or removal of any permanent building or structure next to real estate or railroad is entitled to a mechanics’ lien in the state of Virginia. Architects are also entitled to mechanics’ lien rights.

To file a construction lien in Virginia, there are certain pre-requisites that must be followed.  One of the requirements is that a pre-lien notice be filed.  Pre-notices are required in certain circumstances. A subcontractor may pursue personal liability against an owner under Virginia’s mechanics’ lien statute. In order to do so, a subcontractor must give notice to an owner or its agent and file an affidavit verifying the amount due within thirty (30) days from the time that the structure or project is completed. The same would be true for a sub-subcontractor attempting to assert personal liability claims against a general contractor.

An owner is permitted by statute to designate a mechanics’ lien agent when a building permit is issued. Notice must be given to the agent within thirty (30) days of the first date that the materialmen perform labor or furnish material to the building or structure or within thirty (30) days of the date a building permit is issued if such labor or material are first performed or furnished by such person before the issuance of the building permit. While the failure to give notice does not bar recovery, a lien claimant’s recovery would be limited to value of the labor of materials provided on or after the date of that the pre-notice is given to the owner’s agent.

With regard to the filing of a construction lien itself, under Virginia’s statute, a mechanics’ lien must be filed by a lien claimant within 90 days from the last day of the month in which the claimant last performed labor or furnished material but in no event later than 90 days from the time such building, structure, or railroad is completed.  The 90 day time period would also begin to run from the date of termination if that situation occurs on a project.

Further, under Virginia statute, the lien may only include labor or materials furnished within 150 days from the last date labor was performed or materials provided to the project.  Accordingly, while the statute allows a lien claimant 90 days from your last day of the month in which work or materials were provided in which to file a lien, that lien may only include the value of the labor or materials that were furnished within the prior 150 days.  Retainage is excluded from the 150 day limitation by statute.

In order to file a mechanics lien in Virginia, you must have a contract.  That contract does not need to be written, but can be oral, express or implied.

In addition to filing a Virginia construction lien, stop notices are also a helpful tool for getting paid.  A Stop Notice is a notification that has the ability to enhance the effectiveness of a mechanic’s lien. A Stop Notice, or a notice to withhold funds, is sent to the company that is financing or funding the construction funds for a project. Once that company receives the Stop Notice, that company has notice that it should withhold sufficient money to satisfy the stop notice claim. The purpose of the Stop Notice is to provide the lender, financiers or funders of the construction project notice that there is money owed to a contractor, subcontractor or supplier so that an inquiry can be made as to why that money is not being paid.

For more information on filing a Virginia Construction Lien, a Virginia Mechanics Lien, a Virginia Stop Notice, or a Virginia pre-lien notice, please visit http://www.lienitnow.com/virginia-faq.asp.

Colorado Mechanics Lien “How To”

Liens filed on private property or on funds relating to a public project are known as Mechanic’s Liens. When a lien is filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property. Liens filed with regard to public projects attach to the funds held by the public owner. Contractors, as well as subcontractors, design professionals, sub-subcontractors and material suppliers can file a lien. If a company supplies material to a material supplier, they are not eligible to file a lien claim. Colorado does require that certain pre-lien notices be provided prior to a claimaint files a mechanics lien. At least 10 days prior to filing a lien statement, the claimant must provide a notice of intent to the owner and the prime contractor. One the pre-lien notice requirement is fulfilled, the claimant can file a lien. The filing of a construction lien statement must be completed within four months after the day on which the lien claimant last performed labor or furnished materials. LienItNow.com also prepares and serves Colorado Stop Notices. A Stop Notice is a notification that has the ability to enhance the effectiveness of a mechanic’s lien. A Stop Notice, or a notice to withhold funds, is sent to the company that is financing or funding the construction funds for a project. Once that company receives the Stop Notice, that company has notice that it should withhold sufficient money to satisfy the stop notice claim. The purpose of the Stop Notice is to provide the lender, financiers or funders of the construction project notice that there is money owed to a contractor, subcontractor or supplier so that an inquiry can be made as to why that money is not being paid. For more information on filing a Colorado Construction Lien, a Colorado Mechanics Lien, or a Colorado pre-lien notice, please visit http://www.lienitnow.com/colorado-faq.asp.

State of Washington Mechanics Lien “How To”

In the State of Washington, liens filed on private property or on funds relating to a public project are known as Mechanic’s Liens. When a lien is filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property.  On a private project, the mechanics’ lien places an encumbrance on the property that makes it difficult to resell or re-finance the property without first removing the lien.

In the state of Washington, all contractors must be registered with the Department of Labor to enforce any potential lien rights and bond claims. Washington’s mechanics and materialmen’s lien laws provide contractors, subcontractors, suppliers, and professional service providers with lien rights to protect their entitlement to payment on private construction projects.

Under Washington law, a lien would not only encumber the owner’s interest in the property, but it is also possible to lien an owner’s construction financing. That would require the construction financing entity to withhold the amount of the lien from the owner’s construction draw downs until the lien is released.

Under Washington law, prime contractors must provide all lower tier subcontractors and suppliers with a notice requirement containing certain information that is necessary for the filing of a lien. A prime contractor’s failure to provide such notice will eliminate the notice requirement as a defense and subcontractors and lower tier suppliers will not have to comply with any pre-claim notice requirements. Thus, the prime contractor must disclose, by written notification or posting on the job site itself, key information that affords potential lien claimants the ability to file a lien.

Prime contractors and first tier subcontractors are not required to provide a notice of right to claim a construction lien. Lower tier subcontractors/suppliers and professional service providers must provide a notice of right to claim a lien.

On residential projects, the notice of right to claim lien must be provided within 10 days of the first performance of work or delivery of material or equipment. On private or commercial projects, this notice must be delivered within 60 days.

Thereafter, the notice of right to claim lien must be recorded within 90 days of the claimant’s last date of work.

Those with direct contractual privity with the owner have 1 year to file a lien; subcontractors have 90 days to do so.

In Washington, in order to file a lien, you must have had a contract to perform work or supply materials for the project.  The contract can be either oral or written.

For more information on filing a Washington Construction Lien, a Washington Mechanics Lien, or a Washington pre-lien notice, please visit http://www.lienitnow.com/washington-faq.asp.

California Mechanics Liens and Stop Notices “How To”

In California, the construction lien law is very specific. In addition to simply filing a construction lien, a claimant needs to make sure that it complied with all the pre-requisites that the mechanics’ lien law requires.

Liens filed on private property or on funds relating to a public project are known as Mechanic’s Liens. When a lien is filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property.  On a private project, the mechanics’ lien places an encumbrance on the property that makes it difficult to resell or re-finance the property without first removing the lien.

Contractors, as well as subcontractors, design professionals, sub-subcontractors and material suppliers can file a lien. If a company supplies material to a material supplier, they are not eligible to file a lien claim.

In California, in order to file a lien, some claimants must fulfill some prerequisites.  Within 20 days of the commencement of work on the property, subcontractors and suppliers should provide written notice to the owner, the general contractor and the construction lender that they are performing work on the property. If the notice is served late, then the claimant can claim a lien for the value of the labor or materials provided in the 20 days preceding the service of the notice and thereafter.  Pre-notices are required to be served prior to filing a mechanics’ lien claim.

With regard to the lien filing itself, there are timing restrictions.  Prime contractors must file a claim of lien within 60 days after a notice of completion or notice of cessation is recorded, or if no recording of completion or cessation is accomplished, within 90 days after the completion of the work of improvement.

Subcontractors and materialmen must file a claim of lien within 30 days after a notice of completion or notice of cessation is recorded, or if no recording of completion or cessation is accomplished, within 90 days after the completion of the work of improvement.

California does not require that, in order to file a lien, a claimant have a written contract.  Oral contracts are sufficient if the lienor has sufficient documentation to show the existence of an agreement or that it performed the work for which it is filing a construction lien.

Another effective tool to collect receivables on a construction project, in addition to a lien, is a Stop Notice.  A Stop Notice can be filed on both public and private projects, and is a notification that has the ability to enhance the effectiveness of a mechanic’s lien. A Stop Notice, or a notice to withhold funds, is sent to the company that is financing or funding the construction funds for a project. Once that company receives the Stop Notice, that company has notice that it should withhold sufficient money to satisfy the stop notice claim. The purpose of the Stop Notice is to provide the lender, financiers or funders of the construction project notice that there is money owed to a contractor, subcontractor or supplier so that an inquiry can be made as to why that money is not being paid. The 20 day pre-notice is required to be eligible to file a Stop Notice.

For more information on filing a California Construction Lien, a California Mechanics Lien, or a California pre-lien notice, please visit http://www.lienitnow.com/california-faq.asp.

Washington, D.C. Mechanics Lien “How To”

Washington, D.C. permits contractors, as well as subcontractors to file a lien. If a company supplies material to a material supplier, they are not eligible to file a lien claim. If the project involves an owner occupied one or two family residence, then only a party having a direct contract with the owner can file a lien.  This is meant to protect homeowners from having construction liens filed on their property by companies that they did not hire.

While Washington, D.C. does require that the lienor have a contract in order to file a construction lien, oral contracts are sufficient if you have sufficient documentation to show the existence of an agreement or that you performed the work for which you are liening.

The Notice of Intent that is filed in Washington must be filed within 90 days after the earlier of the completion or termination of the project.

For more information on filing a Washington, D.C. Construction Lien, a Washington, D.C. Mechanics Lien, or a Washington, D.C. pre-lien notice, please visit http://www.lienitnow.com/washington-dc-faq.asp.

Arkansas Mechanics Lien “How To”

In Arkansas, liens filed on private property or on funds relating to a public project are known as Mechanic’s Liens. When a mechanics lien is filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property.

Contractors, as well as subcontractors, design professionals, sub-subcontractors and material suppliers can file a construction lien in Arkansas. If a company supplies material to a material supplier, they are not eligible to file a mechanics lien claim.

Ten days prior to the filing of a mechanics lien claim, Arkansas requires that a construction lien claimant give the owner, or the owner’s agent, or both of them, notice that a mechanics lien claim is going to be filed.

On 1 to 3 family residential projects, prior to the furnishing of materials or labor, the principal contractor must provide the owner with a formalized notice that materials and labor will be used in the construction of the project and the owner is responsible for payment.

Suppliers on commercial construction projects must send written notice of non-payment to the general contractor and the owner within 75 days of the date on which the supplies were provided. This notice does not apply to residential projects.

After the appropriate pre-notice has been provided to the owner, Prime contractors, subcontractors, materialmen and design professionals must file a mechanics’ lien within 120 days of the last date the claimant provided labor or materials to the project.

 For more information on filing an Arkansas Construction Lien, an Arkansas Mechanics Lien, or an Arkansas pre-lien notice, please visit http://lienitnow.com/arkansas-faq.asp.

West Virginia Mechanics Liens

In West Virginia, the construction lien law is very specific. In addition to simply filing a lien, a claimant needs to make sure that it complied with all the pre-requisites that the mechanics’ lien law requires.

Liens filed on private property in West Virginia are known as Mechanics’ Liens. When a lien if filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property.

Contractors, subcontractors, sub-subcontractors and suppliers have mechanics’ lien rights. Any person who, under a contract with a general contractor or a subcontractor for a part of the work, and who may furnish materials or other necessary supplies or equipment, has lien rights in the state of West Virginia. Architects, surveyors, engineers and landscape architects also have lien rights.

A lien notice must be served upon an owner within 100 days of the furnishing of the last materials, work or services. The 100 day time requirement applies to suppliers as well.  If a lien is not filed within this time period, the lien rights are forfeited.

Something to be cautious of when filing a construction lien in West Virginia is that the correct owner of the property is listed in the lien claim.  Often, contractors believe one person or company owns the property, when, in fact, the property is owned by a different person or company name. 

For more information on filing a West Virginia Construction Lien, a West Virginia Mechanics Lien, or a West Virginia pre-lien notice, please visit http://lienitnow.com/west-virginia-faq.asp.