Sending a Michigan preliminary notice is an effective way to speed up payment on a construction project. A preliminary notice is an informational document typically sent to the property owner near the beginning of a construction project. Here's what you need to know about the rules and requirements for sending preliminary notice in Michigan.
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Notice of intent to lien
Michigan preliminary notice requirements for:
General contractors are not required to send notice on private projects.
General contractors are not required to send preliminary notice on public projects.
Since GCs will not make a claim against their own bond for non-payment, they do not have bond claim rights, and have no preliminary notice requirement.
Subcontractors and suppliers must provide notice on private projects.
Notice must be sent within 20 days
Notice may be sent late
Notice is sent to owner and GC
This deadline is extended for laborers, who have 30 days after wages were due, and not paid, to serve notice. Additionally, subs must provide a sworn statement like the GC on residential projects, prior to receipt of payment.
2nd-tier subcontractors and suppliers must send notice on public projects.
Notice must be sent within 30 days
Notice cannot be sent late
Notice is sent to GC and public entity
Suppliers or others who contract with the GC are not specifically required to send preliminary notice.
There are a lot of rules and requirements surrounding providing Michigan preliminary notices, so it's important to make sure that you get the details right. Different notices can be required at different times depending on the specific project and the work being done. It can be a harder than it should be to make sure that the notice you're sending is effective and correct. Here are some frequently asked questions (and answers) about the Michigan preliminary notice process.
Who needs to send a preliminary notice on private projects in Michigan?
Prime contractors are not generally required to send any type of preliminary notice in Michigan. However, if requested by the owner, they must provide a list of subcontractors and suppliers on the project.
All other parties who didn’t contract directly with the property owner must provide a Notice of Furnishing on all private construction projects.
Lastly, on residential projects, Sworn Statements must be provided to the owner (by the prime contractor) and to the prime contractor (by subcontractors) before receiving any progress or final payments. The statement must list all subs, sub-subs, suppliers, and laborers, with whom the party contracted, and lists the amounts paid to them; if any.
When does a Michigan preliminary notice need to be sent?
A Notice of Furnishing should generally be provided no later than 20 days after first furnishing labor and/or materials to the project. If a Notice of Commencement (NOC) has not been recorded or provided after sending a request, notice should be sent within 20 days after the NOC was filed or received. If the claimant is a wage laborer, then notice must be given within 30 days from when wages became due.
However, quicker noticing may be advisable because the owner is not liable for amounts already paid to the contractor prior to receiving the notice. The Sworn Statement should be provided whenever a payment is due or requested on a residential project.
What if I send a Michigan preliminary notice late?
If the Notice of Furnishing is not provided timely, all is not necessarily lost. The failure to give the notice within the proper time period is not fatal to a lien claim in Michigan but will reduce the amount of the lien to the unpaid balance owed from the owner to the general contractor upon receipt of the notice
Who needs to send a preliminary notice on public projects in Michigan?
Preliminary notice on public projects in Michigan is required from all claimants who didn’t contract directly with the prime contractor,( i.e. second-tier subs and suppliers and below) in order to retain the ability to make a claim against the payment bond in the event of nonpayment.
Who do I need to send a public preliminary notice to in Michigan?
Public project preliminary notices in Michigan must be sent to the prime contractor who posted the payment bond. And, although not required, notice can also be sent to the surety who is providing the bond for full visibility on the project.
How should a public preliminary notice be sent in Michigan?
A Michigan public preliminary notice should be served by certified mail to any place the prime contractor maintains a business or residence. However, if the claimant can prove that the party actually received the notice sent by some other method, that notice will suffice.
What if I send a Michigan public preliminary notice late?
Failure to send preliminary notice on a public works project in Michigan within the 30-day timeframe is fatal to a claimant’s ability to make a claim against the payment bond.
People are asking Michigan construction attorneys:
Will the "Notice to Owner" that is included in our estimate and contract protect our Lien rights?
If you are in direct contract with the owner on a private construction project, you do not need to do a Preliminary Notice. Within 90 days from the date you recorded your mechanics lien, you need to file a lawsuit to enforce the lien, or the lien is considered void. I suggest you contact an attorney who is knowledgeable concerning construction claims to assist you.
The description of the scope of work is not intended to be extensive. There is nothing wrong with providing an attachment, but if you can describe the scope generally, that is usually considered acceptable. I suggest you contact an attorney familiar with mechanic's liens to assist you.
I suggest you be a little more descriptive in your question. When you refer to your "AIA," I assume you mean that you have an AIA form contract directly with the tenant. When you refer to "PLN," I assume you are referring to a Preliminary Lien Notice. Assuming these assumptions are correct, you should serve your Preliminary Lien Notice on the Tenant, the Property Owner and the Lender.
On most projects, parties who contract directly with the property owner are not required to deliver a preliminary notice, although if requested to do so a direct contractor must provide a list of subs and suppliers on the project. On residential projects, however, providing notice is specifically required of direct contractors. Prior to receiving any progress or final payment, the contractor must provide the property owner with a sworn statement listing all sub-tier parties with whom the contractor has contracted and the amounts unpaid to them, if any. This sworn statement notice is to allow the property owner to keep track of liabilities down the payment chain, to gain project visibility, and to serve as a check for the receipt of lien waivers from sub-tier parties. Likewise, the sworn statement is also required of subcontractors on residential projects, is delivered to the GC, and lists the sub-tier parties with whom the sub contracted, and amounts due (if any).
Michigan also has preliminary notice rules for parties performing work on public projects. Every 2nd-tier subcontractor or below, that is everybody who didn’t contract with either the public entity or the general contractor, must deliver a preliminary notice within 30 days of first furnishing labor or materials.
First, read the guide to preliminary notices in Michigan. The guide introduces you to the notice of furnishing form, including what you need to include, who you need to send it to, when it needs to be sent, and how it needs to be sent.
Next, download a copy of the Michigan preliminary notice. Michigan mechanics lien law is strict when it comes to the language and formatting for construction notices. Levelset’s free forms were written by construction attorneys to meet those requirements, making this part easy for you to get right.
Fill out the notice form
Be careful! Accuracy is important.
The next step is to fill the form out. To ensure you secure your right to file a mechanics lien, be careful to include al the required information and make sure that information is 100% accurate. Failure to do this could forfeit your Michigan lien rights.
Deliver your notice
Lastly, it’s time to deliver the Michigan preliminary notice. You have two delivery options: either by personal service or certified mail, return receipt requested.
Send your notice to the owner or the owner’s designee within 20 days of first furnishing. Laborers have 30 days from when payment was due.
How to send a Preliminary Notice with Levelset
Select Preliminary Notice document.
Provide basic job information.
Levelset sends the document for you. Postage included!