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Does a small contractor have to provide pre-lien notice when dealing directly with the owner of property?

MinnesotaMechanics Lien

Client is sole owner of a small construction company that routinely tears out and replaces driveways. He was referred to a homeowner (through other clients) who needed a new driveway. It was a one-day job. The quoted cost was around $6,500. One-half was paid up front with the balance due on completion. Home owner made excuses for failing to pay the second portion of the bill. When a lien was threatened the homeowner claimed no lien could attach since no pre-lien notice was given. A lien was nonetheless filed and payment still has not been made. Minn.§ 514.011 Subs. 4b seems somewhat ambiguous on the subject.

1 reply

Apr 9, 2020
According to § 514.011, all parties who contract directly with the owner of the property must either include a specific notice in their contract, or, if no written contract exists, provide the notice to the owner personally or by certified mail within 10 days after they agree on the work to be performed. The subdivision goes on to state that a contractor who ails to provide the required notice "shall not have the lien and remedy provided by this chapter." However, there are exceptions to Minnesota's notice requirements. Notice is not required to maintain lien rights if the property is:
  • owned by the same party that controls the contractor
  • a dwelling of more than four individual units (when the project is residential)
  • at least partially non-residential (and not agricultural) and the property or improvement is greater than 5,000 sq. ft.
For a single family residence, however, the notice is generally required in order to retain the ability to file a valid and enforceable lien. In most cases, however, the notice is incorporated into the contract itself, as the notice is only two relative small clauses. Before accepting that the notice was not appropriately provided, the contract should be checked for the following language: "(a) Any person or company supplying labor or materials for this improvement to your property may file a lien against your property if that person or company is not paid for the contributions. (b) Under Minnesota law, you have the right to pay persons who supplied labor or materials for this improvement directly and deduct this amount from our contract price, or withhold the amounts due them from us until 120 days after completion of the improvement unless we give you a lien waiver signed by persons who supplied any labor or material for the improvement and who gave you timely notice."    
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