Deadlines are of critical importance for potential mechanics lien claimants. Missing a deadline can mean the difference between being able to file an enforceable mechanics lien, and not being able to. Which, in turn, can mean the difference between getting paid and not.
This can be a challenge in some states. Since the deadline to send a preliminary notice is generally based on the date of first furnishing labor or materials to the project, how is that date computed by a material supplier who has different dates for shipping, delivery, etc? When the deadline period is very short, the difference between the ship date and delivery date could be the difference between having enough time to get the notice sent appropriately, or not. So – how is it determined?
Look to the Statute
Usually, the deadline is far enough from the first furnishing date that the claimant can get the notice repaired appropriately and delivered on time without too much worry. However, some states, like Oregon, have a very short timeline for providing preliminary notice when such notice is required. On owner-occupied residential projects in Oregon, parties that did not contract directly with the owner must give the owner a Notice of Right to Lien within 8 days (!) of the claimant’s first furnishing of labor or materials to the project. On other projects, the only parties required to give the notice are material suppliers who only supplied materials and did not provide any labor. So when there is such a small window to deliver the notice, what date starts the clock?
In Oregon, the statute sets out the deadline as follows:
“The notice of right to a lien may be given at any time during the progress of the improvement, but the notice only protects the right to perfect a lien for materials, equipment and labor or services provided after a date which is eight days, not including Saturdays, Sundays and other holidays as defined in ORS 187.010, before the notice is delivered or mailed.”
This has been interpreted to mean within eight working days of the start date of the work or the delivery date of the materials or equipment. Since the notice must be given “during” the improvement, using a date prior to the actual delivery may be dangerous if the work hadn’t actually commenced (although, since commencement of the improvement is not defined, the shipping of materials may be enough to start the project).
In other states, the answer may be determined by different wording in the statute or case law, but generally, the actual date the material is delivered to the project is sufficient for the start date. Some exceptions to this may be found in certain states, and may apply to situations in which materials are specially fabricated or a lot of work is required off site prior to the delivery. These are factual questions that don’t have specific universal answers that work in every case.
Visit the Material Supplier section of Levelset’s website for more info on the challenges suppliers have getting paid.
Often, there are other things that can help a little bit if the notice is a bit late because of a short timeline. It’s worth noting that, in many states, the notice is considered “given” to the owner upon mailing – not receipt – so that buys some time for the potential lien claimant to get the notice prepared and sent on time.
Calculating deadlines is important, but in order to calculate the deadline appropriately, the claimant needs to start from the right date – whether that date is the start of the project, the first furnishing of materials the last furnishing of materials, the end of the project, or some other date.
Like many other things in lien law, choosing the right date can be more complicated than it seems.