Law Offices of Robert Nellessen

P.O. Box 409 • Santa Rosa • CA 95402
Phone (707)578-1200
Fax (707)578-5100

Representing Contractors, Engineers, Architects, and Homeowners since 1981


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Subcontractors/Material Suppliers

Q. What happens if I didn't send my Preliminary Notice when I first arrived on/delivered to the jobsite?

A. The Preliminary Notice must be hand delivered or sent via First Class Certified Mail within 20 days of providing labor/materials. Notice must be given to the General Contractor and Owner and . Lender. Regular mail is ineffective. If you provide some service/materials and then 30 days later deliver the Notice, you can Lien only for the value provided within 20 days of the Notice. However, you can still enforce your contract rights.


Engineers, Architects, Surveyors

Q. I provided services to the general contractor months before construction is projected to begin. How can I preserve my lien rights?

A. So long as you deliver a Preliminary Notice within 20 days of the improvement commencement, you can file a lien if you are not paid (Civil sect. 3097(c)(6)). You do not have to wait for groundbreaking; my advice is, once the building or septic permit is issued, hand deliver or send via First Class Certified Mail, your Preliminary Notice to the Owner, Lender and General Contractor.


General Contractor

Q. The Owner is 60 days behind in his progress payments. What are my rights?

A. Unless your contract provides otherwise (i.e. Lender approval required) you are entitled to your progress payment within 30 days of your demand (i.e. Building Department approval). If there is a dispute, the Owner can withhold only 150% of the value of work in dispute. If you are forced to litigate and you win, you are entitled to 2% interest per month and attorney's fees.

Q. The job is completed and the Certificate of Occupany and/or Final Inspection/actual occupancy occurred 45 days ago.
(1) The owner will not have money to pay the Final Retention/Last Payment for another 60 days.
(2) The owner continues to submit punch lists and is holding my entire Retention. What should I do?

A. (1) Absent a contrary provision in your contract you are entitled to the full Retention on the 45th day after completion/actual occupancy (Civil sect. 3260). If you fail to Lien the property timely (usually within 60 days of the Notice of Completion-see 1st question) you have lost your Lien rights. Liens are significant leverage to secure early payment, and are very cost effective. If the property is liened the Homeowner can still secure financing-any mortgage lender will simply require that you are paid first! You are also entitled to the 2% per month interest. (2) See above. Also, the homeowner is limited, even with good faith punch lists, to withhold only 150% of the value of the incomplete work.

ALL LIEN CLAIMANTS:

Important - a lien is valid for only 90 days. Within 90 days you must either file suit or an "extension of credit and lien", otherwise your lien expires.


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