Question:

Answer:
The answer to this question is complicated, and depends completely on what was done, and for whom. On private works projects, there are two kinds of pre-lien notices required by statute, one under the mechanic’s lien statute, RCW 60.04, and one under RCW 18.27, the contractor registration act.

In order to preserve the right to encumber the project property with a lien, RCW 60.04.031 provides that a pre-lien notice, substantially in the form set out in that statute, must be provided to the project owner (with a copy to the prime contractor) by: a) second or lower tier subcontractors; b) persons performing “professional services”’ (a term specifically defined in RCW 604.04010, but which applies to design professionals, surveyors, engineers, etc.); and c) material and equipment suppliers. Under the mechanic’s lien statute, the general contractor and first-tier subcontractors (those contracted directly with the prime contractor) are exempt from providing pre-lien notices.

However, contractors working directly for the owner may still have to provide a preliminary notice under the contractor registration act. Whenever a project involves either: a) four or fewer residential units with a contract price over $1,000; or b) a commercial project with a contract value between $1000 and $60,000, any contractor that contracts directly with the project owner must provide the Notice to Customer required by RCW 18.27.114, and must do so before the work starts, in order to preserve its lien rights. Generally, a contractor contracting with another contractor (i.e., a subcontractor) on such projects is exempt from providing the Notice to contractor must obtain the project owner’s signature on a copy of the Notice, proving that it was provided and when, and the issuing contractor must maintain a copy of the signed Notice in its records for three years. Failing to provide the RCW 18.27.114 Notice to Customer, if required, is fatal to a contractor’s ability to record a lien on such projects.

Copies of model pre-lien notices are available on the Department of Labor and Industries Website, www.lni.wa.gov. For specific advice regarding liens and lien rights, consult your construction law attorney.

Todd Henry is an attorney with Oles Morrison Rinker Baker LLP. Todd’s practice focuses on representing general contractors, subcontractors, project owners and design professionals in all aspects of construction law, from contract preparation to litigation. Prior to his legal career, Todd was a 20-year construction management professional. He worked as a project manager for prominent Seattle-area general contractors, managing a diverse range of multi-million dollar projects from hotels to historic remodels. Todd has spent his entire working life in the construction industry, having grown up in a mechanical contracting family with a Northwest history going back four generations. In addition to his experience as a general contractor, Todd was the minority shareholder of a design/construct mechanical contractor in the 1990s. You can contact Todd at (206) 623-3427 or at henry@oles.com.

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