Notice requirements can make or break a mechanics lien, depending on the jurisdiction your in. Content, timing, delivery. Each state has their own requirements for you to follow concerning different types of notices. Some states are very strict when determining whether a party complied with these requirements. Other states look for “substantial” compliance. New York just so happens to be a “substantial” compliance state when it comes to notices.
The Brass Tax
The facts of the case are unimportant to our point, but if you are interested in the entirety of the case, you can read it here: Jefferson Bus. Interiors, LLC v. East Side Pharmacy, Inc., 2016 NY Slip Op 30082. The issue we are concerned with is the challenge of the validity of the mechanics lien. More specifically, East Side Pharmacy alleged that Jefferson Group’s lien was invalid because they failed to comply with the notice requirements set out under New York Lien Law § 9. The law states that a notice of lien is required to state the business address of the lienor and, if the lienor is a foreign corporation, its principal place of business within the state. However, another provision, Lien Law § 23, states “[t]his article is to be construed liberally . . . [and] substantial compliance with its several provisions shall be sufficient for the validity of a lien and to give jurisdiction to the courts to enforce the same.”
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Examining both these provisions, the Court determined that the notice substantially complied with the law, and therefore, the mechanics lien was valid. Jefferson Group had no place of business within New York, so they provided their principal place of business and the address of the attorney upon whom service may be made in New York. The Court reasoned
The provision of the address of its principal place of business outside the state along with the address of its attorney within the state fulfills the purpose of the notice of lien, which is to provide information to a property owner so that the owner “may, upon inquiry, ascertain whether or not the material has been actually furnished and the service have been actually rendered, and the value thereof.”
The Court focused rather on the purpose of the requirements than the strict compliance of the requirements themselves. Therefore, the mechanics lien was valid.
Knowing the notice requirements of your state is essential to filing a valid and effective mechanics lien. Many states, like New York, will focus on whether the purpose of the notice was achieved. For example, some states are warming up to the idea of notices being sent via email rather than certified mail. That being said, it is important to understand whether the jurisdiction you are filing in is strict with notice requirements or not. Some states will even have statutory forms for notices that must be used. You do not want to be in the position of having an invalid mechanics lien because of incomplete or incorrect notices. Study up!