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If I don't know my total contract amount as there will be multiple deliveries to this jobsite over the next few months, what should I enter as the estimated total contract amount?

MinnesotaPreliminary Notice

I am a material supplier doing multiple deliveries to same job.

1 reply

Jun 21, 2019
That's a good question, and this is a common problem for material suppliers and equipment renters. Looking at Minnesota's preliminary notice requirements in the state's lien statute.

§ 514.011(2)(a) of Minnesota's lien statute requires that preliminary notice must be in a specific form, with specific language. Under that section, the following statement must be included: "To the best of our knowledge, we estimate our charges will be ____________" - and the blank is for the value of the service or material to be provided.

As you well know, it's hard to estimate exactly how much material will be required for a given project, right at the start. Still, the notice allows some flexibility. It states that the amount must be given to the to the best knowledge of the party sending notice. So, where possible, providing an educated guess of a good faith estimate of how much work will be provided should likely be sufficient. If that number isn't known, taking a look at similar jobs and basing an estimate off of that might be helpful. Or, reaching out to the customer and asking them what they think a fair estimate would be could be helpful, too.

If there was any doubt that a guess doesn't have to be accurate in order to preserve lien rights, § 514.011(2)(b) reads: "A person entitled to a lien does not lose the right to the lien for failure to strictly comply with this subdivision if a good faith effort is made to comply, unless the owner or another lien claimant proves damage as a direct result of the failure to comply." So, as long as an estimate is made in good faith, and as long as that estimate has been reasonably calculated, the amount being inaccurate typically won't be detrimental to a party sending notice.

I hope this was helpful! For more information on Minnesota notices and liens, these resources will be valuable:
(1) About Minnesota Preliminary Notices
(2) Minnesota Mechanics Lien Overview
(3) Minnesota Pre-Lien Notice Requirements and Exceptions.
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