It might seem counterintuitive to warn an owner before you attempt to file a mechanics lien, but this couldn’t be farther from the truth. When a Nashville mechanics lien law attorney furnishes a notice of intent (NOI) to lien on legal letterhead, it sends a message to owners that clearly demonstrates your refusal to accept nonpayment. Tennessee is not one of the nine states that legally requires contractors to send a notice of intent to lien, but that doesn’t mitigate the power of this notice.
Furnishing a notice of intent to lien to a delinquent owner results in payment within 20 days in nearly half of all cases. That means contractors are getting paid without going to court or even filing a mechanics lien at all. Of course, the mechanics lien is a contractor’s best weapon against nonpayment due to its sound legal backing, but that doesn’t take away from the efficacy of a well-written NOI. In this article, a Nashville construction lien lawyer will explain exactly how an NOI can help you get paid even when a mechanics lien isn’t on the table.
Collecting Due Payment: Sooner IS Better
The longer you wait to collect payment, the less likely you are to succeed. Your mechanics lien rights are contingent on your ability to meet deadlines. These deadlines vary from state to state. Contractors in Tennessee must file a mechanics lien within one year of their last provision of labor or materials. This lien must also be enforced within one year of completing work. In other words, you have the same amount of time to file and enforce a mechanics lien. If you wait too long to file, the amount of time remaining to enforce the lien could be reduced to the point where your lien is no longer enforceable.
An NOI doesn’t follow the same rules. Simply consult a Nashville mechanics lien law attorney to prepare an NOI on your behalf and it will be sent to the owner. Doing so early on gives you plenty of time to see how things will play out. If your NOI is successful, you will receive payment, allowing you to continue taking on new projects and growing your business. Conversely, an NOI that fails to yield a tangible result can be followed up with a mechanics lien. Best of all, you already have a Nashville mechanics lien law attorney on your side to ensure that your lien is perfected.
NOI and Mechanics Liens: the Perfect One-Two Punch
An unsuccessful NOI doesn’t have any impact on the success of a mechanics lien. In fact, when an NOI fails to help a contractor get paid and they follow up with a mechanics lien claim, the mechanics lien claim still has a high probability of success, helping contractors get paid within 60 days in the majority of cases. These two powerful tools can help contractors get paid, but sending an NOI before you file a claim can help you save money (and is required in Tennessee). There are countless reasons why an owner may choose to withhold payment, including workmanship disputes, change order disputes, owner bankruptcy, and any other number of reasons. They may have even simply forgotten to pay you. Regardless of the reason, an NOI is an effective reminder that mounts pressure on delinquent owners.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.