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Tennessee Noticing Requirement

TennesseeMechanics LienMonthly Notice

We have a job where we provided a one-time order on December 10th. Based on my understanding of the lien law, our deadline to file the lien would be March 10th. The Notice of Nonpayment would normally be due by the end of March (90 days from the last day of Material supplied). Does that mean we must send a notice of nonpayment to the owner before we file the lien, or is it OK to file the lien prior to sending out the notice, but we must notice the job at the end of March? What happens if we file the lien, but don't send out the Notice of nonpayment? Does that invalidate our lien?

1 reply

Mar 25, 2019
These are great questions. First, let's discuss the Tennessee mechanics lien deadline. Then, we'll move onto the Tennessee notice requirements. After that, we'll look at considerations relating to liens and notices.

Tennessee is one of a minority of states where the deadline to lien is based on project completion rather than last furnishing. In Tennessee, a prime contractor's deadline to lien is 90 days from the completion of the project, unless a Notice of Completion ("NoC") is recorded. If a NoC is recorded, the deadline for residential jobs is 10 days from the NoC filing for residential jobs, and that moves to 30 days after the NoC is filed for commercial jobs. For subcontractors, the ability to file a lien claim on residential property may not be available - but for work done on commercial jobs, the deadlines are the same as prime contractors' (90 days from the completion of the project, shortened to 30 days after the filing of the NoC if one is filed). But, regardless of the project type or role - the deadline to lien is either based on project completion or the filing of a Notice of Completion - not last furnishing (though the two timeframes may end up being similar). Next, let's look at notices.

In Tennessee, Notice of Nonpayment must be sent within 90 days from the last day of each month where work, labor, or materials were provided but unpaid. Thus, generally, a claimant's lien deadline will usually be beyond their deadline to send notice unless their last furnishing date was at the very end of the project or unless a Notice of Completion is filed.

However, regardless of whether the deadline to send a notice extends beyond the deadline to file a claim, a prospective lien claimant may be required to send a Notice of Nonpayment for amounts they intend to lien under § 66-11-145(a) of the Tennessee lien statute. It reads "Every remote contractor with respect to an improvement, except one-family, two-family, three-family and four-family residential units, shall serve, within ninety (90) days of the last day of each month within which work or labor was provided or materials, services, equipment, or machinery furnished and for which the remote contractor intends to claim a lien under this chapter, a notice of nonpayment". So, when a claimant intends to file a lien for amounts owed and unpaid, a Notice of Nonpayment should be sent - and the timeframe included creates a deadline for that notice - but it does not state that notice can't be sent earlier.

While it's possible to read that section so as to only require notice if the deadline occurs prior to the deadline to lien - it's important to recall why notices are used in the first place. Many contractors, subs, and suppliers see them simply as burdens or obstacles prior to making a lien claim. However, these notices provide prospective claimants an opportunity to obtain payment without the need for a mechanics lien filing. Further, for owners and prime contractors, these notices provide them an opportunity to resolve disputes before they come down to a lien filing. It's a win-win. In fact, in the majority of cases, if all notices are sent, mechanics lien claims won't even become necessary. So, even in a situation where notice might not technically be required prior to making a claim, it's generally a good idea to send notice anyway.

For more on the Tennessee mechanics lien requirements (including deadlines, notices, and more), this resource should be valuable: Tennessee Lien & Notice Overview. For additional deadline clarity, the zlien Payment Rights Advisor should be helpful.
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