In the 2022 legislative session, Idaho passed House Bill 609 — new legislation that directly impacts mechanics lien claimants in the state. In addition to new requirements, HB-609 also provides for the award of attorney fees in a lien foreclosure action. This article will break down everything Idaho contractors need to know about these new lien law changes, which go into effect in July 2022.
Read the full guide to Idaho’s mechanics lien rules & requirements
New lien law changes for Idaho contractors
On March 17, 2022, Governor Brad Little signed a new law that adds additional lien filing requirements for residential general contractors, alters how a notice of lien filing can be served, and provides for the award of attorney fees for prevailing parties in foreclosure actions.
Bill Overview:
- Title: Idaho House Bill 609
- Summary: Amends existing law to revise provisions regarding a claim of a lien and to provide for attorney’s fees and costs in certain instances.
- Sponsor: House Business Committee
- Effective Date: July 1, 2022
Idaho House Bill 609: Added language
House Bill 609 will amend three subsections under Idaho Code §45-507. The changes appear below in italics:
(3) The claim shall contain:
(e) For work or materials subject to the provisions of section 45-535, Idaho Code, required proof of disclosure and acknowledgement of receipt.
(5) A true and correct copy of the claim of lien shall be served on the owner or reputed owner of the property either by an officer authorized by law to serve process delivering a copy thereof to the owner or reputed owner personally or by mailing a copy thereof by certified mail to the owner or reputed owner at his last known address.
(7) In any court proceeding regarding a lien filed pursuant to this section, the prevailing party shall be entitled to recover reasonable attorney’s fees and costs.
New Idaho lien requirements, explained
Let’s take a closer look at the practical effect of each of one of these changes.
Residential GC lien claim requirements
General contractors on residential projects are currently required under Idaho Code §45-525 to provide certain disclosures to the homeowner prior to entering into a contract over $2,000.
The notice must include the language provided under the statute, and an acknowledgement of receipt signed by the homeowner. The GC should retain a copy for their records and provide a copy to the homeowner.
As of now, failure to provide this notice can subject the contractor to penalties under the Idaho Consumer Protection Act.
However, once this law goes into effect, it will also impact the mechanics lien process as well. When filing an Idaho mechanics lien claim, a copy of the disclosure signed by the homeowner, along with an affidavit of service must be attached in order for the claim to be valid.
Serving a copy of the claim
Once an Idaho mechanics lien claim has been filed, the claimant must serve a copy of the claim of lien on the owner or reputed owner within 5 days of filing the claim in the county recorder’s office. Until the new law goes into effect, service can be accomplished either by “delivering a copy thereof to the owner or reputed owner personally, or by mailing a copy thereof by certified mail.”
However, it appears come July 1, 2022, hand-delivering a copy personally will no longer be an option. Rather, the copy of the lien claim must be served either by certified mail or through an “officer authorized by law to serve process.”
In Idaho, this means a sheriff, deputy sheriff, peace officer, or court marshall must deliver the notice. This can prove tricky at times — just ask Pennsylvania lien claimants!
However, since certified mail will remain a viable option, that’s considered best practice moving forward.
Attorney fees to the prevailing party
Lastly, the final change under this new legislation is the availability of attorney fees and court costs for the prevailing party in a foreclosure action. Most of the time, mechanics liens can get a contractor paid before having to file a lawsuit to enforce the claim.
Sometimes litigation is necessary, and many contractors decide not to pursue their claims in court because attorneys can be expensive. With the addition of subsection 7, concerns over legal fees is alleviated to an extent. But keep in mind that the award is available to “prevailing parties,” so if the enforcement action goes in favor of the property owner, the contractor will be on the hook for the owner’s attorney fees.