Wednesday, April 21, 2010

State of Washington Mechanics Lien "How To"

In the State of Washington, liens filed on private property or on funds relating to a public project are known as Mechanic’s Liens. When a lien is filed with regard to work performed on privately owned property, it attaches to and encumbers the fee simple ownership of property.  On a private project, the mechanics’ lien places an encumbrance on the property that makes it difficult to resell or re-finance the property without first removing the lien.

In the state of Washington, all contractors must be registered with the Department of Labor to enforce any potential lien rights and bond claims. Washington’s mechanics and materialmen’s lien laws provide contractors, subcontractors, suppliers, and professional service providers with lien rights to protect their entitlement to payment on private construction projects.

Under Washington law, a lien would not only encumber the owner’s interest in the property, but it is also possible to lien an owner’s construction financing. That would require the construction financing entity to withhold the amount of the lien from the owner’s construction draw downs until the lien is released.

Under Washington law, prime contractors must provide all lower tier subcontractors and suppliers with a notice requirement containing certain information that is necessary for the filing of a lien. A prime contractor’s failure to provide such notice will eliminate the notice requirement as a defense and subcontractors and lower tier suppliers will not have to comply with any pre-claim notice requirements. Thus, the prime contractor must disclose, by written notification or posting on the job site itself, key information that affords potential lien claimants the ability to file a lien.

Prime contractors and first tier subcontractors are not required to provide a notice of right to claim a construction lien. Lower tier subcontractors/suppliers and professional service providers must provide a notice of right to claim a lien.

On residential projects, the notice of right to claim lien must be provided within 10 days of the first performance of work or delivery of material or equipment. On private or commercial projects, this notice must be delivered within 60 days.

Thereafter, the notice of right to claim lien must be recorded within 90 days of the claimant’s last date of work.

Those with direct contractual privity with the owner have 1 year to file a lien; subcontractors have 90 days to do so.

In Washington, in order to file a lien, you must have had a contract to perform work or supply materials for the project.  The contract can be either oral or written.

For more information on filing a Washington Construction Lien, a Washington Mechanics Lien, or a Washington pre-lien notice, please visit http://www.lienitnow.com/washington-faq.asp.

1 comment:

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