How to File a Mechanics Lien in Michigan

  Most general contractors in this State are familiar with filing a Michigan mechanic’s lien in the register of deeds office of the county in which the project is located. But not everyone appreciates how such a Michigan lien relates to a Notice of Commencement served by the owner. Because it is a good idea for the general contractor to interface with the recording of this Notice, let us examine some of the Michigan statutory mechanics lien requirements.

 First the basics. Before the start of any substantial work on a project, the owner or tenant (assuming there is T. I work), is mandatorily required to record a Notice of Commencement.  And, it must also be posted in a conspicuous place at the project. Since this isn’t the obligation of the owner, why would the general care either way? Well, there is a reason.  It directly impacts a mechanics lien in Michigan by lower tiered contractors. And the last thing you want is such a lien on the project.

 The purpose of the Notice is to give potential lien claimants, such as subs and suppliers, information they may need to send out their pre-lien notices.  And as everyone knows, you cannot file a mechanics lien in Michigan without one.  Absent this information, it is sometimes difficult to do so and so the legislature includes such information in the Notice for their benefit. The idea is that it would facilitate the serving of a pre-lien notice—called a “Notice of furnishing”. 

 If the Notice of Commencement is not posted at the job site, the general contractor is required to furnish copies to a sub or supplier. If not furnished, a sub or supplier can make the demand by certified mail. Once the request is made, the general must also give a blank Notice of Furnishing form. In fact, each Notice of Commencement is required to have a blank Notice of Furnishing attached, either at the recorder’s office or when posted at the site.  The legislators in Michigan are so insistent, that they require keeping copies at the job site and preventing copies from being taken down or unavailable.  Such pre-lien notices are very important because without them you cannot file a Michigan lien.

 Now this is where it becomes important for the general contractor. If the owner fails to record and post a Notice of Commencement, it gives subs and suppliers extra time to serve their pre-liens.  Normally, pre-liens are served within 20 days of first furnishing labor or materials. But if the Notice of Commencement is recorded late, they have 20 days after recording the Notice of Commencement to serve. All this does is delay the project “close out” and gives people extra time to serve. The last thing you want is a dangling mechanics lien in Michigan.

 So the bottom line is make sure your owners serve and record the Notice of Commencement and follow-up with any inactivity. When it comes to asking the question of how to record a Michigan mechanic’s lien for subs and suppliers, you should be on top of these legislative requirements.

 

0