5 essential things to know about Ohio mechanics liens
Contractors & suppliers have strong lien rights in Ohio. If a contractor or supplier isn’t paid on an Ohio job, they can turn to filing a lien to speed up payment and protect themselves. However, there are specific requirements and rules that must be followed. You can learn more about those requirements here: How to File an Ohio Mechanics Lien.
On top of that, here are 5 essential things you need to know about Ohio’s mechanics lien law.
Ohio construction managers have mechanics lien rights and liens are effective for a long time
In Ohio, general contractors, subcontractors, labors suppliers and construction managers have mechanics lien rights. Compared to other states, mechanics liens on Ohio have a relatively long shelf life. Once filed the lien is effective for 6 years.
The deadline to file depends on the project
The deadline to file a mechanics lien in Ohio depends on the building and type of project. All projects except owner-occupied residence (defined as a single condominium or 1-2 family dwelling), have a 75-day deadline to file. This deadline begins on the date of last furnishing labor or materials.
Where an owner-occupied residence is concerned, the lien must be filed within 60 days from the last date a project participant provides labor or materials for a project. In this circumstance, the lien will not attach to the property if the general contractor has been paid prior to the date the owner receives the lien. For this reason, it is always advisable to file early.
Liens on gas and oil wells are required to be filed 120 days from the date that the project participant last provided materials or labor.
In some instances, a notice of furnishing is required
It is always advisable to send preliminary notice whether it’s required on a project or not. In Ohio, family residences (of 1-3 units) and condominium projects do not require preliminary notice.
For all other projects, generally, a property owner will file a Notice of Commencement. This means that all project participants not directly in contact with the property owner (excluding laborers), must file a Notice of Furnishing. The notice must be sent via certified mail with return receipt requested within 21 days from the date the project participants first provided service or materials. Filing any earlier is ineffective. If the property owner has not filed a Notice of Commencement then preliminary notice is not required, just recommended.
Additionally, a property owner or other interested party may request a written notice of labor or materials provided. A project participant must provide this statement within 10 days in order to preserve lien rights.
Notice of recording the lien is mandatory
It is absolutely required that the property owner or any other interested parties (spouses, part or co-owners) must be given notice within 30 days after the lien has been filed. This deadline extended to 40 days in the event that the property owner cannot be served (by mail or by service via sheriff). In which case, a copy of the lien may be posted to the improvement at a conspicuous location – and that will be sufficient for service. More on that here: How do I serve an Ohio lien when the owner can’t be served?
Because the lien does not attach to the property until the owner receives notice, without notice (and thus, attachment), the property owner might make a payment to the general contractor, limiting the project participant’s lien rights.
After a project participant gets paid, it is important to release the lien
After a project participant successfully files a mechanics lien to get paid, it is mandatory to release the lien. The participant must release the lien within 30 days of the satisfaction of the lien. Failure to release the lien will hold the project participant liable for any subsequent damages the property owner may have suffered from after the lien was already satisfied. This amount cannot exceed the amount of the lien or contract.