Massachusetts Mechanics Lien—by a General Contractor
General contractors in this State are well aware of the potency of recording a Massachusetts mechanic’s lien. Not only does it show your seriousness, but it can stop a sale or refinance of the property and create just the right impetus in getting paid. But many contractors not realize that a pre-lien notice is required before the recording of such a Massachusetts lien and is a trap for the unwary if not served and recorded. Let us examine this technicality.
In most states, only subcontractors and suppliers are required to serve pre-lien notices before the mechanics lien. A general contractor, defined as someone who has a direct contract with the owner, verbally or in writing, typically does not have to serve such a notice. But it is differed in Massachusetts. A pre-lien notice called “Notice of Contract” must be recorded and served upon the owner. Quite literally, “no notice–no mechanic’s lien in Massachusetts”.
Remember, it is not your license status but who you have your contract with. Therefore, whether you are licensed as a general or a sub, if you have a direct contract with the owner, you are considered a general and must serve the pre-lien.
As far as the format, of all the 50 states, this is the shortest pre-lien notice in existence. It simply identifies the project and the general contractor–that is it.
You have a long period of time in which to serve. It can be served any time after you have signed a written contract with the owner, up to including 90 days after completion of the project. But there is no reason to wait this long. There are a number of instances in which the general contractor cannot file a Massachusetts mechanic’s lien because they have forgotten to serve this notice. Accordingly, most prudent general contractors simply serve the notice at the time of executing the contract. The Massachusetts mechanics lien statues do not require personal service or service by certified mail, so simply handing a copy to the owner at that time of signing the contract makes the most sense.
Unfortunately, you must also record the notice with the registry of deeds or in the county or registry district of the land court where the project is located.
Many people ask why the notice is required if the owner already has dealt with you directly and has a signed contract. Since you already know each other, why can’t you simply file a Massachusetts mechanic’s lien? Mechanics lien experts disagree, but the following are the possible reasons: a) notifies potential lenders, who are giving either permanent financing or refinancing to ensure all claims have been paid, b) if the contract is with the owner’s agent, giving direct notice to the owner himself or herself, or c) allows the demand to a general contractor to furnish lien waivers from all subs and suppliers.
Because the notice is recorded, it must be verified and notarized. Just like you would do with a Massachusetts lien itself.
Regardless of the rationale, this is a required notice as a condition precedent to recording your Massachusetts mechanic’s lien. So when you hear discussion as to how to file a mechanic’s lien in Massachusetts, don’t forget this technicality.