The Builders Counsel: A Construction Law Blog from Washington Construction Lawyer & LEED AP Douglas S. Reiser

Just remember your good old UNCLE Doug.

As the economy tightens up and less credit becomes available to businesses, payment problems arise. Everyone in the construction industry should know their lien rights; their value is unmatched. Remember: UNCLE. Those 5 letters stand for the 5 steps to remember when filing a lien in Washington.

There are a few jokes I could make about why “uncle” represents the lien statutes, but lets just consider it a clever acronym:

(1) Understand

A contractor should always understand where it is on the contractor tree. Its important to know whether you are working directly for the general contractor, one of the general’s subcontractors, or a subcontractor’s contractor. This relationship will determine your obligations before filing a lien.

If you are the general contractor, you already know who you are. But, if you are lower down the chain (what we refer to herein as a “sub-tier contractor”), obtain the owner’s and the general contractor’s information. This is vital for serving notice and serving a lien, if you get that far.

(2) Notice

There are three types of notice: (1) General Contractor notice, (2) Subcontractor  notice, and (3) Sub-tier Contractor notice.

 
• General Contractors – The General Contractor does not have to provide a lien notice, but it does have to produce a Model Disclosure Statement under RCW 18.27.114. This is a simple statutory statement which must be delivered to the owner, signed by the owner and maintained by the contractor for 3 years. Read more about when you need to use this statement by clicking here.

• Subcontractors – If you have a contract with the General Contractor, you are considered a subcontractor. A subcontractor to the general does not have to serve a  notice unless you are working on a residential project. If your project is residential, you should serve a lien notice under RCW60.04.031 no later than 10 days (if new construction) or 60 days (if a remodel) after beginning the work.  Notice is served by sending a copy via certified mail or by personally serving it on the owner.

• Sub-Tier Contractors – Any sub-tier contractors will likely have to serve a notice of their right to file a lien, regardless of the type of project. You are considered a sub-tier contractor if you do not have a direct contract with the owner, meaning you were contracted by some other party (general, subcontractor, etc.).  If you are a sub-tier contractor you should serve a lien notice under RCW60.04.031 no later than 10 days (if new residential construction) or 60 days (anything else) after beginning the work. Notice by a sub-tier contractor should be served on both the owner and the general contractor.

(3) Count

It is very important that you can establish the final date that you performed labor or provided materials to a job. This date can represent either the date of termination, abandonment or completion of the job – as long as its the final day that you performed work (or delivered materials).

Once you know the date – start the count. You have precisely 90 days in order to file your lien. If you file the lien after those 90 days, it will be null and void.

(4)  Lien!

This is probably the most daunting step for most contractors. A lien should be filed and recorded in accordance with RCW 60.04.091 (in fact a sample form is written into the code). This means to follow the form requirements in 60.04.091, sign and execute it properly (remember that a corporation requires an attestation).

After you have a properly drafted and executed document – file it.  A lien must be filed, within the deadlines that we discussed above, at your County Recorders Office. There is a fee associated with this filing.

After it has been filed, you are required to serve a copy on the property’s owner or reputed owner within 14 days from the date the lien was recorded. You may serve this lien only by certified/registered mail or by personal service.

(5) Enforce

The final step is enforcement. If you have not settled your lien with the property owner, you must file a lawsuit seeking foreclosure of the lien within 8 months from the date it was recorded. An attorney can best help you ensure that your suit properly enforces the lien.

Well there you have it – how to file a lien. Remember that the lien laws are strictly construed by courts of law. Thus, it is vital that you stay within the bounds of RCW 60.04, if you expect to have an enforceable lien.