New York Preliminary Notice FAQs

About New York Preliminary Notices

New York has a rare approach to preliminary notices: the lien law says that they aren’t required for any project participant on any project. This complete lack of noticing requirements definitely makes New York an outlier when it comes to preliminary notice, and construction payment law, the majority of states have at least some notice requirement.

But, while the mechanics lien law specifies no preliminary notices are required whatsoever, is that really the case? Well, pretty much yes. But New York does require preliminary notice of a type for direct contractors performing work pursuant to “home improvement contracts.” The rules regarding home improvement contracts, and that define what actually constitutes a home improvement contract, are set out by New York’s General Business Law. Like other states, New York has specific requirements for contracts related to “the repairing, remodeling, altering, converting, or modernizing of, or adding to, residential property” or the construction of a custom home. These strict contractual requirements are generally formulated to provide protection to the homeowner, given that a piece of residential property is often a person’s largest asset, and many homeowners are not necessarily very sophisticated with respect to either contractual law or construction.

One of the requirements for home improvement contracts, set forth by GBS § 771, is that the contract must contain a notice to the owner that parties furnishing labor or material, and who are not paid, may have a claim against the owner that can be enforced against the property pursuant to applicable lien laws. Additionally, a home improvement contract must include certain specific language about mechanics liens “in clear and conspicuous bold face type.” This required language is:

“Any contractor, subcontractor, or materialman who provides home improvement goods or services pursuant to your home improvement contract and who is not paid may have a valid legal claim against your property known as a mechanic’s lien.  Any mechanic’s lien filed against your property may be discharged. Payment of the agreed-upon price under the home improvement contract prior to filing of a mechanic’s lien may invalidate such lien. The owner may contact an attorney to determine his rights to discharge a mechanic’s lien”

While this is a required contractual provision, and not specifically a notice – and it is set forth by the General Business Law and not the mechanics lien law – this requirement is, for all intents and purposes, a preliminary notice related to lien rights that must be provided by parties contracting with a homeowner on certain residential projects.

Additionally, just because there is not really any actual traditional preliminary notice requirements in New York, that doesn’t mean that there is no benefit to sending preliminary notice. There are many reasons that sending preliminary notice, even when not specifically required, is the right thing to do. Sending preliminary notices promotes project visibility, opens channels for communication, and can speed up payment.