This is part one in a multi-part series of articles about compliance with Missouri’s mechanics lien law for both new construction and remodeling.
In November, the changes to Missouri’s mechanic’s lien law will have been in place for one year. Attorney Steven Blair, who first presented an educational program on compliance with the new law to HBA members last year, recently presented an updated program for HBA members in Joplin.
Even after a year, Blair said there’s still some confusion about new requirement to file the Notice of Rights (NOR) for new residential construction.
He says the bottom line is that you must comply precisely with what the statute requires for the NOR. In new construction, the consequences are serious if contractors, subs and/or suppliers don’t get it done correctly:
Blair said he often receives questions about whether or not the “original” contractor can fulfill the NOR requirement for subs:
But if the original contractor does not name a sub-contractor, it is that subcontractor’s responsibility to file their own NOR for the project. Blair was asked if original contractors could also include suppliers in their NOR. “Yes, if the original contractor names the suppliers, then the suppliers need not file a separate NOR, and it will be timely so long as it is timely for the original contractor,” said Blair.
(For a sample format of the NOR, click here)
Another new requirement of the law is the Notice of Intended Sale (NIS) which must be filed by the property owner. NIS must be recorded not less than 45 calendar days prior to the earliest calendar date the owner “intends” to close on the sale of such property to such purchaser, and the anticipated date of closing must be stated in the Notice.
The NIS starts the clock ticking on the timeframe for filing the Notice of Rights in the county in which the property is located. “Claimants” who seek to retain the right to assert a mechanic’s lien against residential real property are required to “record” a NOR in the office of the Recorder of Deeds for the county in which the property is located not less than five calendar days prior to the intended date of closing stated in a “Notice of Intended Sale.”
While there are some requirements to post or provide this information upon request, it is prudent to be proactive in finding out if NIS has been filed when you come on a job -especially if it is late in the building process. The best practice may be to always file your NOR routinely at the beginning of project – there appears to be no requirement that a claimant wait until a property owner records NIS in order to record a NOR.
As part of his Joplin program, Blair provided a review of both existing and new requirements of the lien of lien law for new construction. He created a resource checklist focusing on new construction and the requirements for maintaining your lien rights, (please note you are still required to have notice language in your contracts,) and how to exercise them in compliance, when necessary.
Download the checklist for NEW CONSTRUCTION by clicking here.