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Is it too late for the preliminary notice? Or can I begin to file the lien right away?

I am a general contractor who conducted water damage restoration and pack out services to a home. This claim was paid through the home-owner's insurance and a pack out check was issued directly to the home owner as a 2 party check with his name and the public adjuster we hired. Homeowner cashed the check with out the public adjuster's authorization in December 27, 2019. Our company just found out about the situation and the homeowner refuses to pay us for the pack out services and used that money to remodel his house. Insurance companies usually take a while to issue checks for jobs done and once they're issued payment is required immediately. The pack out has been completed. However, the pack in was not completed since the owner KNEW he had the money and wasn't going to pay, he took all his belongings before hand. How do I go about the 20-day preliminary notice? Is it too late since payment was issued in December without our knowledge?

1 reply

Feb 24, 2020

In California, all parties are required to provide a preliminary notice in order to fully protect lien rights - however, parties who contract directly with the property owner are only required to send preliminary notice to the construction lender, if any. While the notice, if required, may be sent late, it only protects the labor or material furnished beginning 20 days prior to the date on which he notice was sent. This means that if a notice is required, it must be sent within 20 days of last performing labor or furnishing materials in order to provide any protection at all. Additionally, California requires that any mechanics lien must be filed within 90 days from the completion of the project as a whole, in order to be valid and enforceable. In the event that a lien remains an option (i.e. if no preliminary notice was required and less than 90 days have elapsed from completion of work) the lien filing process can be made easy by doing it electronically, here.

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