Should the amount listed on the NOI be the total amount owed or for past due invoices only? One of our GCs told us that our NOI is void because it includes current invoices. Is this the case?
1 reply
Oct 10, 2019
Ohio isn't a state that requires a Notice of Intent to Lien be sent in order to later file a mechanics lien. So, an argument that an Ohio Notice of Intent to Lien is invalid, itself, wouldn't seem to hold much water. However, it is worth looking at what amounts are subject to lien.
Mechanics liens may be filed for work that's been performed but not been paid. So, because liens may only be filed for work that's actually been done, the bulk of a given lien will be past due invoices. However, if work has been performed but not yet invoiced, that work will generally still be lienable - after all, it's work that's been performed but not yet paid for. And, of course, amounts that represent work not yet performed cannot be liened.
Bottom line
It's easy to get caught up in the details of a payment dispute. However, a Notice of Intent to Lien is simply a tool to leverage future rights in order to compel a customer to make payment. So, where a contractor is splitting hairs as to what is and isn't owed, it would likely be helpful to try and reframe the conversation to get back to the heart of the issue - that payments aren't being made, as required. And, if a mechanics lien filing does eventually become necessary, it's important to be precise in what amounts are claimed.
For more information on Ohio notice and mechanics lien rights, here's are some great resources:
(1) Ohio Preliminary Notice Guide and FAQs(2) Ohio Mechanics Lien Guide and FAQs