By Alex Barthet
What happens when you forget to send out that Notice to Owner? The short answer is all is not lost. There are still things you can do to get paid. Before we discuss that in detail, let’s go through what the basic notice to owner and lien rules are so that everyone is on the same page.
Basic Notice to Owner and Lien Rules
In order to have a lien right in most situations, you need to send a notice to owner no later than forty-five calendar days from your first work or delivery of materials onto the site. Forty-five days is the outside date within which the owner or any other parties that are supposed to receive the notice actually receive that notice. Therefore, you shouldn’t wait till the forty-fourth day or the forty-fifth day to send it because it’ll be too late. We advise our clients to have a process in place in their office to ensure the notice to owner is promptly sent.
If the job is bonded, you need to record your claim of lien or serve your notice of non-payment within 90 days of your last work or delivery of materials. Again, you should not be waiting until the ninetieth day. You should be doing it well before that. When it’s about day 60 from your last work, and you haven’t been paid, that’s when you need to record your claim of lien or serve your notice of nonpayment.
Also, you need to file an action in the courts no later than one year from when you record your lien or one year from your last work if you’re suing a bonding company. Note that there’s a little difference of up to 90 days between suing on lien and suing on a bond, but the outside limit is one year after which your lien and bond claim is automatically extinguished.
Some clients believe that they can re-record the lien. For example, they record the lien on January 2nd, 2016. So, when January 2nd, 2017 comes along, they think they will be able to keep their lien alive by recording another copy. That’s not a thing to do. That would actually constitute slander of title because the second lien is no good. You can keep that lien alive by doing one thing and only one thing, and that is to file a lawsuit to foreclose on your lien no later