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When filling out a prelim do I enter the estimated contract amount since we do not know what the final amount will be yet?
We needed to clarify whether the amount of the contract that we put on the preliminary notice is a binding amount, or whether it is just an estimate and the lien (if any needed to be filed) would be on the amount of the invoices in question.
Montana preliminary notices don't seem to require an estimated contract amount in order to be valid and preserve the right to lien, according to sections § 71-3-531 and § 71-3-532 of the state's mechanics lien statute. So, because that's not a part of the form that's statutorily required, then that amount shouldn't be binding on a prospective lien claimant. Rather than the amount featured on a Montana preliminary notice, a Montana mechanics lien claimant would generally be entitled to file a mechanics lien on all amounts they're owed but unpaid for the improvement of the property.
Generally, though, any time an estimate is required to appear on a preliminary notice, it's understood that the estimate is just that - an estimation. And, relatively small variations in the estimate and price actually being charged shouldn't be particularly consequential. Though, in a state like Arizona, a revised notice could be required when work substantially exceeds the original estimate.
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Anonymous Subcontractor
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Feb 28, 2020
Thank you Matthew. We also do business in Idaho, Wyoming, Utah, and New York. Can you please apply the question to these states as well?
Thank you!
Idaho and New York do not require preliminary notices before filing a mechanics lien. So, for those states, any preliminary notice would be voluntary and amounts wouldn't need to appear on the notice.
In Wyoming, does not appear that preliminary notices must include the estimated price/contract amount for the work for public or private construction projects.
Finally, from what I can tell, it doesn't appear that Utah requires that an estimated price/contract amount is required on preliminary notices, either.
The information presented here is not legal advice and should not be construed as such. Rather, this content is provided for informational purposes. Do not act on this information as if it is advice. Further, this post does not create any attorney-client relationship. If you do need legal advice, seek the helSee More...See More...
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