SACRAMENTO – The Contractors State License Board (CSLB) wants to inform licensees of changes in the state’s mechanics lien law effective July 1, 2012. While these changes don’t substantially change the laws, they do change the wording and formats of the notice and lien release forms required to protect contractors’ lien rights.
The new law replaces the 20-Day Preliminary Notice with the Preliminary Notice. Subcontractors and materials suppliers should use the newly-worded forms. The Preliminary Notice should be delivered to the homeowner in person or by certified, registered, or first-class mail, with a receipt of the mailing as proof. You may give notice any time before work starts or product is delivered and up to 20 days after. If the Preliminary Notice is given more than 20 days later, you are only able to receive payment for work or products supplied 20 days before notice was given, and anytime thereafter.
The Notice of Mechanics Lien wording is also changed in the new law. This notice must accompany the claim of lien and be sent via certified, registered, or first-class mail, with the receipt as proof of mailing. Failure to send the notice with the claim could result in the lien being unenforceable.
The conditional and unconditional lien release forms have also changed. Make sure you have subcontractors and suppliers sign the new conditional forms as progress payments are owed and when the project is finished before they are given final payment. Have them sign the new unconditional release forms when they receive progress payments and their final payment.
The new law gives the homeowner 15 days instead of 10 to file a notice of completion with the county recorder. If notice is filed, the contractor has 60 days and subcontractors 30 to record a lien. If there is no notice filed all parties have 90 days to record a lien.