Securing and leveraging your mechanics lien rights is the single most effective way to protect yourself against non-payment in the construction industry. To do so, there are specific requirements, notices, and deadlines that must be met. If working on a private project in the state of North Dakota, one critical step in the process is sending a North Dakota Notice of Intent to Lien. Here’s how it works.
What is a North Dakota Notice of Intent to Lien?
The North Dakota Notice of Intent to Lien (NOI) is a notice that must be sent prior to filing your lien claim. It is also known as a Notice that a Lien Will be Claimed. All potential lien claimants must send this notice before they are allowed to file a construction lien in North Dakota. This includes general contractors, subcontractors, material suppliers, and design professionals.
The notice requirements can be found under N.D. Cent. Code §35-27-02. This statute states that:
Written notice that a lien will be claimed must be given to the owner of the real estate by certified mail at least ten days before the recording of the construction lien.
That’s not much to go on. Let’s break down what exactly this notice is, and how it works to secure your mechanics lien rights.
Filling out the Notice of Intent to Lien form
As far as what information to include in the notice, the statute doesn’t provide much guidance. The only specific requirement is a statement that a lien will be claimed.
However, there is some general self-identifying and project-identifying information that should be included as well. Such as:
- Claimant’s name and address
- Property owner’s name and address
- Description of the property
- A legal property description isn’t necessary, a simple street address should suffice
- Description of labor, materials, or services provided
- The date the contract was executed
- Amount unpaid
- Notice language
“This notice is provided to inform you that the Claimant has provided services to your Property and the payment for these services is due and owing. If payment isn’t made within ten (10) days, a Claim of Lien will be filed on the Property within ten (10) days after delivery of this Notice as per N.D. Cent. Code §35-27-09.”
Serving a Notice of Intent to Lien in North Dakota
In order to secure the right to file a valid mechanics lien, this notice must first be sent out. While most states require parties to send a preliminary notice at the beginning of a construction project, North Dakota doesn’t. (We still recommend sending a preliminary notice on every construction project, even if it’s not required.)
Instead, the state is one of several that require a Notice of Intent be sent out a few days prior to filing a lien claim.
When to send the Notice of Intent
The North Dakota Notice of Intent to Lien needs to be sent to the property owner at least 10 days before filing your mechanics lien. So let’s do the math. The lien deadline to file a claim is 90 days from the last date of furnishing labor or materials to the project. So, the latest this notice can be sent is 80 days from the last date of providing services to the job site.
But don’t wait this long. Remember, this notice needs to be given at least 10 days before filing the claim. The earlier the better. Under ND mechanics lien laws, this notice must be sent by certified mail, and the owner must actually receive the notice to be valid.
Also, it may not be a bad idea to sent the notice to the prime contractor or construction lender, if there is one. That way, your payment issue gets the attention it deserves.
Sending the notice late or not at all
While you can file a North Dakota mechanics lien later than 90 days, your lien rights will be extremely limited. For one, the lien will not be effective against any subsequent purchasers of the property. And two, if the general contractor has been paid in full (but hasn’t passed the payments on to you), then you won’t have any lien rights. That’s because North Dakota is an “unpaid balance” lien state.
Therefore, anyone experiencing payment problems on a project should mark their calendars. It takes careful planning and timing to secure your lien rights in North Dakota.