If you've done work on a construction project and haven't been paid, Washington laws may provide you with lien rights. To take advantage of this powerful collection tool, it's important that you closely follow the technical lien laws. This guide will help you understand liens and provide you with a map for the Washington lien landscape.
The lien and its benefits
Put quite simply, a construction lien is a privilege on a property. In most cases, if you perform construction services on a property, the law affords you the right to place a lien on the property itself in the event of non-payment.
A lien may:
- Prevent the sale of the property
- Tie up progress payments or funding of the job
- Bring more parties to the table to consider your claim
- Transform the property into security for your payment
- Allow you to sue the owner for work you performed, even if you didn't contract with the owner directly
- Allow you to recover attorney fees and legal costs against non-paying parties when you properly record a Claim of Lien
Preserving your lien rights
Your right to lien a construction project is not absolute. You should be aware of Washington's lien laws before beginning work on a project to ensure that if a dispute does arise, you'll have the right to file a lien.
The two likely reasons your lien rights may be compromised are if you fail to provide the required notice at the commencement of the project, or if you fail to file your lien on time.
In some circumstances, you must send notice to the property owner to preserve your lien rights. Failure to send notice when required may cause you to forfeit your right to lien. In deciding whether you're required to send notice, you must understand these three things:
1. Who is required to send notice
Whether a contractor/supplier is required to send preliminary notice depends upon the type of project and the role being played in the project. Under Washington statutes, you are required to send written notice of a right to claim a lien to the property owner in every circumstance except:
- if you contract directly with the owner or owner's agent;
- if you are a laborer making a claim based solely on labor; or
- if you are a subcontractor who contracted with the prime contractor.
An exception applies if the project is "improvements to existing owner-occupied single family residences," in which case only the first circumstance above applies. Accordingly, you must send notice to the property owner unless you contracted with him/her
2. The required contents of notice
Washington law is very specific on this point, and the statutes even provide a form for contractors. The Washington State Legislature offers more information about this statute. To properly deliver notice, have it in writing and deliver it to the owner through certified or registered mail and/or in person.
3. When to send notice
It's a good practice to send the required Notice of Lien Rights before work on a construction project begins. While a Notice of Lien Rights can-in theory-be sent at any time, a Claim of Lien can only be filed as to the work, services, or materials performed or delivered 60 days before the notice is delivered to the property owner (for most projects), and 10 days before the notice is delivered in new construction single-family-residence projects.
Regarding improvement projects on owner-occupied, single-family residences, a lien may be satisfied only from amounts not yet paid to the prime contractor by the owner at the time the notice is received.
In Washington, a claim of lien must be filed within 90 days from the last date work, services, or materials are performed or delivered. If the lien does not produce payment, an action to foreclose the lien must be brought within 8 months of the lien's filing.