Contract Question About Preliminary Notice

Question:

“We are on phase two of a contract and have not yet filed a prelim notice. Can we do it late?“

Answer:

“Some providers are not required to send a preliminary notice. For example, if you are the prime contractor and you have entered into a contract directly with the property owner, no preliminary notice is required. This is because the mechanic’s lien warning is a required part of your contract with the homeowner, so they have been put on sufficient notice of the potential for a lien. An exception is that if the project is being financed by a construction lender, a preliminary notice needs to have been sent to the lender. If you ARE required to provide a notice, you can give the notice before delivering supplies or performing work, or up to twenty days after doing so. If your notice is late, it covers the twenty days prior to delivery and any time thereafter. Meaning, you can send the notice late, but you would only be able to issue a mechanic’s lien for payments owed for the twenty days prior to delivery of the preliminary notice (and any due thereafter). Keep in mind that even if you cannot utilize a mechanic’s lien for the full amount due, you may still have common law litigation claims against a party that owes on a past-due invoice (breach of contract, etc.).”