On January 10, 2023, Senate Bill 5234 was introduced in Washington that, if passed, would require additional information and requirements from lien claimants. SB-5234 is meant to provide additional protections for property owners against frivolous lien claims. Since mechanics liens are such a powerful remedy for non-payment, Washington contractors should be sure to follow the progress of this bill.
Proposed legislation: Washington Senate Bill 5234
Bill overview:
- Bill: Washington Senate Bill 5234
- Title: AN ACT Relating to a lien claimant’s responsibilities when filing mechanics and materialmens liens
- Introduced: January 10, 2023
- Sponsor: Senator Sharon Shewmake
Statement of facts stating why the notice of claim of lien is being filed
Currently, under Wash. Rev. Code §60.04.091, a Washington Notice of Claim of Lien requires the following information:
- Claimant’s name, phone number, and address
- First and last dates of furnishing labor and/or materials
- Hiring party’s name
- Property description
- Owner’s name
- Claim amount
If Washington SB-5234 is enacted, there will be an additional requirement for lien claims. The amended section would read as follows, noting the claim “shall include a concise statement of facts stating why the notice of claim of lien is being filed and include substantiating documentation.”
So what do this “concise statement of facts” and “substantiating documentation” entail? It’s unclear as of now, but this could include a description of labor and/or materials provided, the total contract price, copies of unpaid invoices, any communications between the parties regarding payments, etc.
Free Washington Claim of Lien form
Download a free Washington mechanics lien form, prepared by construction attorneys to meet all statutory requirements.
The content of this statement won’t necessarily make or break a contractor’s claim. However, if the owner requests any additional information regarding this statement, it could present some issues.
Requests for clarification or additional information
Once a claim under this proposed legislation is filed, an owner may request clarification and/or additional information or documentation to support the claim from the claimant. If received, a claimant is required to respond within 12 days. Failure to do so would be taken into consideration by the courts when determining whether the lien is frivolous or filed without reasonable cause.
Learn more: Washington Law Protects Contractors from Dangers of the Frivolous Lien Statute
As of now, an owner may file an order to show cause requiring the claimant to appear in court and justify their claim. If the court determines that the claim was frivolous or without reasonable cause, the claim may either be released or reduced, and the court will award costs and reasonable attorney’s fees to the owner.
This new legislation adds an additional step of requesting additional information from the claimant before the claimant is required to appear in court. Failing to do so will be a factor that the court may consider in determining if the claim is frivolous or filed without reasonable cause.
Initial thoughts on Washington SB-5234
This bill was just introduced, and still has a long way to go before we know whether it will be enacted, or what it will look like if it is. What we do know is that the Washington legislature is treating the threat of frivolous liens seriously, and are looking for ways to implement additional safeguards to curb such practices. Which, in turn, makes the lien process slightly more cumbersome.
If Washington SB-5234 is passed, the requirements will go into effect 90 days after the 2023 Legislative Session adjourns, which would set the effective date around mid-July 2023.
We’ll keep an eye on this legislation and provide any updates if/when necessary.