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Can I file a lien, construction or mechanical if it's been past 20 days since we started the project?

We have worked on new construction for the same contractor for over a year, ther owner says he has been paid, and should have paid us, the contractor says owner still owes him money for that. Do we have to file a notice to lien? Can we, if we are past the 20 day window?

1 reply

Dec 18, 2019

Montana Preliminary Notices

Under Montana mechanics lien law, a preliminary notice must be sent in order to secure mechanics lien rights. This needs to be sent within 20 days of the first furnishing of labor or materials to the project; with a few minor exceptions such as residential projects of 5 units or more. Failing to send this notice within the initial deadline isn't fatal to a lien claim, but can seriously affect the extent to which a mechanics lien can protect against non-payment. The 20-day notice can be sent late, but will only cover labor and materials provided in the 20 days preceding when the notice was sent. Given that the project has lasted over a year, this may not provide much protection under mechanics lien laws.

Alternative Options for Collection of Nonpayment

Just because you may not have secured your full mechanics lien rights on the project, doesn't mean there aren't other alternative options to recovery. Of course, you can always pass the debt on to a collection agency. But if not, here are some other options.

Prompt payment demand

One route that can be taken is to send a payment demand letter to the general contractor. The demand letter can have a bit more of a bite if the Montana Prompt Payment laws are cited in the demand. These provisions will applicable on most construction project, with the exception of residential projects less than $400,000. Under these laws, subcontractors must be paid within 7 days of the GC's receipt of payment from the owner.

Small claims court

Lastly, there is always the option of filing a lawsuit in court. Small claims court may be an option, but the maximum amount of recovery is $7,000. This action can be based on breach of contract or unjust enrichment. Keep in mind that you'll likely want to contact a local construction attorney to guide you on how to proceed. A good place to start is the Montana Bar Association Lawyer Referral program or Avvo.com.

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