How do you proceed with a Preliminary Notice if our customer will not provide the address to a Federal Public job.

5 months ago

We have a customer that I’m trying to enter in as a New Project but they will not provide the address to where the work is being completed because it is a Public Federal job. They are saying that the address is confidential. How can we preserve our lien rights if we cannot enter the address?

Chief Legal Officer Levelset

This is a great question, determining how to maintain rights when other participants aren’t being helpful or forthcoming with information (or are disallowed from providing information) can definitely be important.

Since federally-owned property cannot be encumbered by mechanics liens, a different mechanism for the protection of construction participants was enacted. Federal projects (provided that they are of sufficient size) are subject to the rules and requirements of the Miller Act. The Miller Act requires that GCs on federal projects obtain a payment bond to protect first and second-tier subcontractors, first-tier suppliers, and second-tier suppliers who contract with a first-tier subcontractor.

There is no preliminary notice requirement in order to later make a claim under a bond obtained pursuant to the Miller Act. This means that, if the Miller Act applies, there is no need to send a preliminary notice in order to retain rights to make a claim.

A formal notice of claim is required for 2nd-tier parties prior to initiating a lawsuit, but first-tier subs and suppliers can proceed directly with a lawsuit if they want. The notice of claim, whether required or sent voluntarily to try to avoid a lawsuit, only requires that the project be identified, the name of the party to whom the labor or material was furnished and amount of claim be set forth.

So, the lack of a specific address for a federal project likely does not interfere with the rights to make a claim on the project’s payment bond, provided that the Miller Act applies to the job.

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