Construction jobs involve many out-of-pocket-expenses along with a contractor’s time. The mechanic’s lien helps ensure your right to get paid, so long as certain conditions are met. It can help builders, contractors, subcontractors, equipment lessors, and suppliers receive payment for services performed for nonpaying clients.
Though a powerful tool, a mechanic’s lien is generally viewed upon by courts as only a privilege, not an automatic right ensuring payment. If you fail to file your claim on time, you may lose your legal right to compensation. Smiley Law helps many contractors with timely filing and defense of their lien claims, and here are some important points that we think you need to know.
The Four Most Important Steps for a Valid Mechanics Lien
If you want to get paid, keep the following four steps in mind when applicable by statute:
- You may have to send out the “Preliminary Notice” at the beginning of the project.
- You may have to send out a “Notice of Intent to Lien” to further request payment and forewarn the client of your intention to file a lien against the property.
- You may file your lien claim with the local mortgage office in the parish where the job is located. .
- You must enforce your lien within a relatively short period of time by filing a lawsuit to foreclose. In Louisiana, you must do this within 1 year of the expiration date for filing the lien.
Time is Money
To file your lien, you must comply with all the mandatory notice and form requirements. The courts will rarely if ever consider exceptions or excuses for failure to properly pursue the relevant guidelines of this lien. If you fail to file your claim on time, however, you will likely lose your legal right to compensation form non-contractual parties.
In Louisiana, the deadlines related to a lien claim depend on the lien claimant’s role and whether or not they filed a notice of contract and/or notice of termination. Courts will enforce time limitations, otherwise known as “statutes of limitations” in common law states and “prescription period” in Louisiana, which may interfere with your ability to pursue or receive payments. A contractor must file a mechanic’s lien within 60 days of the date of filing of the “Notice of Termination,” or, if no notice was filed, within 60 days of substantially completing the entire work of the project. We recommend you keep an accurate and updated calendar of all relevant dates related to your claim. If the general contractor files a “notice of contract” on the project the the lien periods are shortened to 30 days.
Failure to give proper notice, in the proper manner, can greatly limit or even completely eliminate your right to a lien. Louisiana law requires that the lien claimant provide the property owner with a copy of the lien statement, sent via certified or registered mail. In cases against a subcontractor, one must give notice to the general contractor and its surety as well.
With so many statutory requirements and deadlines to keep in mind, if you need to file a mechanics lien then it is always best to consult with an attorney as soon as possible. The team at Smiley Law handles mechanics liens for many people just like you – give us a call today.