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How a Lien Notice works

I want to be sure we take care of the necessary steps before we ever have to file a Lien notice. From what I have read up on, we need to have a "Notice of Contract" in order to back up a Pirliminary Lien Notice before filing the actual Lien Notice. Is this correct? Would a Signed Job Proposal/Estimate with a Scope of Work and Payment Terms cover us for any of the following steps to cover us getting paid? We only send a Preliminary Lien Notice if a client is paying us accordingly, correct?

1 reply

Oct 3, 2018

These are good questions! Massachusetts can be a tough state when it comes to lien requirements, and mismatching vernacular can create a lot of unnecessary headaches. I'll break down the requirements for filing a Massachusetts lien below, and I think that should clear up any confusion. If not, feel free to post another question for clarification! In Massachusetts, if a party is hired by someone other than the direct contractor, it's a good idea to send a Notice of Identification - doing so will provide greater protection if a lien becomes necessary. Of course, even if a claimant is not required to send any notice, it's a good idea to send it anyway - notices lead to healthy projects. Next, a "Notice of Contract" must be filed or recorded with the registry of deeds before a lien claim may be filed. This document can be filed at any time after the written agreement to provide work, but it must be filed before the earliest of the following times: (1) 60 days after a Notice of Substantial Completion has been filed/recorded; (2) 90 days after a Notice of Termination is filed/recorded; or (3) 90 days after the last furnishing labor and/or materials. Finally, the last step - If payment has not been made and a lien claim is unavoidable, a claimant can file a "Statement of Account" (which is really just another name for a Claim of Lien). This must be filed before the earliest of the following dates: (1) 90 days after a Notice of Substantial Completion; (2) 120 days after a Notice of Termination; or (3) 120 days after the claimant's last furnishing to the project. Note, though, that this is just a deadline - and a Statement of Account (lien) may be filed before this date as long as a Notice of Contract has been filed. As for the specific questions above, having a signed proposal/estimate would not relieve a party from having to send any otherwise required notice. Regarding whether a signed proposal/estimate would qualify as a written contract, that's a good question. Ultimately, the answer would be up to the court (if a lien claim got that far). However, generally, a document that shows the written offer, acceptance, and consideration exchanged of services might be considered a contract. Of course, the safest option would be to execute a written contract that is clearly designated as such. Finally, regarding preliminary lien notice, I'm not entirely sure what you're referring to. If you mean notice sent at the start of the job before any payment issues arise, then I believe that was covered above - such a notice should be sent at the start of the job (regardless of any payment dispute). If you're referring to a Notice of Intent to Lien - sending a document like this makes the most sense when there are payment issues but the claimant is not yet ready to file a lien. Finally, if that refers to a Statement of Account, that step will hopefully not become necessary - but that represents the actual lien filing. I hope I answered your questions, but if not, feel free to post another question and we'll sort it out! Also, these posts may provide extra clarity: How to File a Massachusetts Mechanics Lien – A Practical Guide; and Massachusetts Mechanics Lien Law: 5 Things to Know.

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