In Texas, a monthly notice is a document that protects the right to file a mechanics lien if payment is not made. It is a type of preliminary notice specific to Texas construction projects. Here's what you need to know about the rules and requirements for sending preliminary monthly notices in Texas.
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Notice of intent to lien
Texas notice requirements for:
Subcontractors & suppliers
GCs are not required to send monthly notices on private jobs in Texas.
Texas contractors who contract directly with the owner do not need to send preliminary notice. However, on residential projects, the general contractor must give the owner a disclosure statement before signing the contract, and a written list of all the subs and suppliers intended to be used.
GCs are not required to send notice on public jobs in Texas.
On public jobs, any claims for non-payment are made against the general contractor's bond. 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.
Texas subcontractors and suppliers must send monthly notices on private construction jobs in order to retain lien rights.
Sent to owner and prime contractor
Cannot be sent late
For residential projects, sub-tier parties must send notice to the owner and prime contractor by the 15th day of the 2nd month following the month that work was performed and unpaid. (Notice must be sent for each month work was performed and unpaid.)
On non-residential projects, first-tier subcontractors must send notice by the 15th day of the 3rd month following each month work was performed and unpaid.
Subcontractors who contracted with a party other than the direct contractor on non-residential projects must send a notice by both the 15th day of the 2nd month, and the 15th day of the 3rd month following each month in which work was performed and unpaid.
Texas subcontractors and suppliers are required to send notices on public construction jobs in order to retain bond claim rights.
Sent to GC and/or surety
Cannot be sent late
First-tier subcontractors and suppliers must send notice by the 15th day of the 3rd month following each month work was performed and unpaid.
Subs or suppliers who contracted with a party other than the direct contractor must send a notice by both the 15th day of the 2nd month, and the 15th day of the 3rd month following each month in which work was performed and unpaid.
A 2nd month notice must be sent to the GC. The 3rd month notice must be sent to the GC and the surety.
The general contractor is generally not required to give any preliminary notice. However, on residential projects, the general contractor must give the owner a disclosure statement before signing the contract, and a written list of all the subs and suppliers intended to be used (updated periodically) unless the owner has specifically waived this requirement in writing (the waiver may be part of the original contract).
Notices on homestead projects
Further, in order to obtain a lien on a homestead, the general contractor must execute and file with the county clerk a written contract setting forth the terms of the contract prior to the furnishing of labor and/or materials signed by both spouses if the owner is married.
Notices on public projects
Payment Bond: All claimants who do not have a direct contractual relation to the contractor furnishing the bond must send a preliminary notice. Laborers making a claim for wages only are excepted from this requirement.
Contract Funds: No claimants making a claim on contract funds are required to provide a preliminary notice.
If a custom material supplier misses the deadline to send a specially fabricated materials notice, that lien claimant may only claim for any materials that were actually delivered and used in the project.
A contract for improvement to a homestead must be filed with the county clerk in the Texas county in which the property is located, prior to the furnishing of labor and/or materials.
Note, however, that despite the general statutory requirement to send notices by registered or certified mail, Texas specifically states that:
“Any notice or other written communication may be delivered in person to the party entitled to the notice or to that party’s agent, regardless of the manner prescribed by law” and “[i]f a written notice is received by the person entitled to receive it, the method by which the notice was delivered is immaterial.”
If you deliver a notice by hand, it’s important to document the delivery in some way, in order to prove that the delivery occurred if necessary.
Subcontractors/suppliers must give the required notices to the general contractor as well as the property owner.
Suppliers of specially fabricated materials must provide notice to the owner and to the general contractor (if they supply a subcontractor).
For homestead improvements, the contract must be recorded with the Texas county clerk in the county in which the property is located. General contractors may give any preliminary notice required to the lender, as well as the owner.
On public projects
The 2nd month notice must be sent to the prime contractor.
According to Texas Property Code § 53-003(c), “If notice is sent by registered or certified mail, deposit or mailing of the notice in the United States mail in the form required constitutes compliance with the notice requirement.”
Note, however, that “[t]his subsection does not apply if the law requires receipt of the notice by the person to whom it is directed.”
A subcontractor or supplier who dealt with the general contractor does not need a direct contract with owner to file a lien even for a homestead. That requirement for the general contractor. However, a subcontractor or a supplier does need to provide a preliminary notice to both the owner and the general. That notice3 must be provided no later than the 15th of the second month following the performance of work or supplying materials. I don't know how you are calculating when you say a month late. If it is even a few days later than the deadline described above, then the lien is not valid. Best approach is to contact the supplier and notify them that such a lien is not valid. If the supplier refuses to remove the lien, you can have a cause of action against the supplier to remove the lien and perhaps even a claim of fraudulent lien which can expose the supplier to damages and attorney fees.
Do I need to file a Notice of Specially Fabricated Materials and Requests for Information
Requests for information, in and of themselves, don't provide any mechanics lien protection. So, on that front, it shouldn't really matter. Granted, having all information on hand could only be helpful - so it may still be worth sending. Regarding the Notice of Specially Fabricated Materials - if the deadline to send that notice is missed, then sending it late won't have any practical effect. However, those materials will still be lienable if they were delivered to the job site and as long as the amounts owed for those materials are included in monthly notices. As for the Notice of Contractual Retainage - that can be sent at any point during your work, really. So, sending that notice later on in the job won't have any negative effect, and it should help to preserve lien rights against retainage amounts moving forward. For further discussion on Texas notices, this page will help: Texas Notice Guide and FAQs.
Texas construction law requires contractors and suppliers to send monthly notices to the prime contractor and property owner. Sending these notices is a requirement in order to retain the right to file a Texas mechanics lien if they are not paid. When it comes to notice requirements, Texas mechanics lien law gets complex pretty quickly; it’s important for construction businesses to follow the rules closely.
Texas notices fall somewhere between a preliminary notice and a notice of intent to lien. A notice may be required at the start of work, but there can also be multiple notices due after each and every month in which labor is performed or materials furnished (but unpaid). This can easily result in a complex mess of paperwork that is difficult to manage, especially on long projects or projects with long payment cycles.
Part of the complexity of the Texas notice scheme is that only a few notices have specific names. The most common construction notice that is generally required by Texas law can be called a 2nd month notice or 3rd month notice (depending on which deadline applies), a “fund-trapping notice”, a preliminary notice, or something else. For the information contained on this page, we’ll use the term “monthly notice.”
Texas Notices Required by Role & Project Type
A direct contractor – one who contracts directly with the property owner – is not required to send a preliminary notice on non-residential projects in Texas. However, they are required to send the owner a disclosure statement with a list of all of the subcontractors and suppliers working on the project.
Subcontractors, material suppliers, equipment lessors, or anybody that did not contract directly with the property owner, must send monthly notices in order to protect the right to file a lien. The further removed from the property owner you are, the more notices you must send.
The rules and requirements related to Texas notices can change depending on project type, the project tier of the party sending the notice, and the work provided by the noticing party.
Texas Construction Notices Deadlines
The deadline in Texas for most construction notices is the 15th day of the month, except for the notice for a retainage claim. If the 15th falls on a weekend or holiday, the notice should be sent prior to the 15th.
Texas’s monthly notice requirement is generally set forth by Texas Property Code § 53-056. The law requires a monthly notice to be sent by the 15th day of the second month after each month in which the claimant performed labor or furnished materials for which they remain unpaid.
And, since Texas monthly notices contain language that is a bit aggressive, and which falls somewhere between a general preliminary notice and a notice of intent to lien, many Texas construction participants don’t want to send the notices unless and until absolutely necessary. This can make the 15th of the month an extremely stressful and busy day for construction companies in Texas.
2nd Month Notice
In Texas, parties hired by a subcontractor (e.g. a sub-subcontractor or a supplier to a subcontractor) must send notice by the 15th day of the second month.
Material suppliers who fabricate custom materials for a construction project must also send a notice of specially fabricated materials by the 15th day of the second month.
Notice of Specially Fabricated Materials
Texas defines specially fabricated material as “material fabricated for use as a component of the construction or repair so as to be reasonably unsuitable for use elsewhere.”
This notice must be sent in addition to any other monthly notice that may be required, in order to retain lien rights.
3rd Month Notice
First-tier subcontractors in Texas (those who have a contract with a Direct Contractor) must send notice by the 15th day of the 3rd month following each month work was performed and unpaid.
In addition to the 2nd month notice, parties hired by a subcontractor must send a notice by the 15th day of the third month after furnishing as well.
Contractual Retainage Notice
In order to file a mechanics lien for unpaid retainage in Texas, a claimant must mail a notice no later than the earlier of these dates:
30 days after the date the claimant’s agreement providing for retainage is completed, terminated, or abandoned; or
the 30th day after the original contract is terminated or abandoned.
Penalties for Failing to Send Notice
The penalties for not providing the required notices in Texas can be severe. Failure to deliver monthly notices when required (even if just one day late) eliminates the ability to file a valid mechanics lien for the amount due for the labor or material furnished in the month(s) associated with the improper notice(s).
And failure to provide a notice of specially fabricated materials means that a claimant may only file a lien for materials that were actually delivered and incorporated into the project (provided other notice requirements are met).
Texas construction notices are complicated and confusing. Our step-by-step guide breaks down the rules, and explains how to prepare and send preliminary notices in Texas. Read this first to understand the process before you try to go it alone. Making a mistake or missing a deadline could mean losing the right to file a mechanics lien in Texas.
Get the right forms
The preliminary notice requirements in Texas are complex, and preparing a notice form in the right way can be confusing. We make this part easy: All of our notice forms were created by construction lawyers to meet the statutory requirements. Choose the form you need from the list below:
Texas law is surprisingly vague about the actual information required on the notice forms. The only actual requirement is that you provide written notice of the unpaid balance. However, it’s important to research and verify all of the information you include in the form.
Deliver your notice
Texas notices should be sent by certified mail. While you can send it with return receipt requested, it’s not required by Texas law.
Generally, notices should be sent to the general contractor and the property owner. However, if you’re a sub-subcontractor or other party who did not contract with the general contractor, it’s only a requirement to send the 2nd Month Notice to the general contractor. Other notices should be sent to both.
How to send a Preliminary Notice with Levelset
Select Preliminary Notice document.
Provide basic job information.
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