Transcription of Construction Liens
1 ConstructionLiens Explanation of constructionliens Notices required How consumerscan protect themselves Contractor responsibilitiesf:constructionlienspamph let/3-11print 11-12 This pamphlet explains Oregon lien laws but shouldnot be considered legal needing assistance providing notices,filing Liens , or obtaining lien priority, should consultan attorney. Some attorneys specialize in constructionlaw and may offer classes or publications about find a Construction law attorney, contact constructionindustry associations, or the Oregon State Bar AttorneyReferral Service at 1-800-452-7636 or Construction Contractors BoardPO Box 14140 Salem, OR 97309-5052700 Summer St. NE, Suite 300503-378-4621, Fax: 503-373-2007 Explanation ofconstruction liens1 What is a Construction lien? Construction Liens have been a part of Oregon s lawfor over 100 years. Under this law, anyone whoconstructs improvements on property, suppliesmaterials, rents equipment, or provides services forimprovements has a right to collect payment from theproperty if they are not paid.
2 If the general contractor isnot paid or does not pay the subcontractors, laborers,material suppliers, or equipment rental companies,those persons may claim a lien against the is the purpose of the constructionlien law?The purpose of the law is to ensure that people arepaid for value that they add to someone s property. Abank can reclaim a car if payments are not made. Workdone to real estate, however, is permanent and cannotbe reclaimed. The lien laws protect those personsworking on the property who do not have a contractdirectly with the property owner (who contracted onlywith the general contractor).For purposes of the lien law, what is thedifference between a general contractor anda subcontractor?Usually, the property owner has a contract with ageneral contractor. The general contractor thencontracts with subcontractors to provide services suchas roofing, drywall, plumbing, electrical, painting, orwindow installation.
3 The property owner does notusually hire the can claim a lien?General contractors, subcontractors, employees,material suppliers, and equipment rental companiesthat do not receive payment can claim Liens . Even ifthe property owner pays the general contractor in full,the subcontractors, employees, material suppliers, andequipment rental companies may not be paid. Thesepersons and companies may then claim a lien againstthe owner s are the property owner s responsibili-ties to a lien holder?Property owners can be forced to pay the lien holder(the person claiming the lien) or face a potential courtorder to sell the property for owners canbe liable if the generalcontractor does notpay subcontractors,employees, materialssuppliers, andequipment information or warnings must begiven to the property owner by the gen-eral contractor?Any contractor who contracts directly with a residentialproperty owner or sells a new residence directly to theowner must provide an Information notice to Ownerabout Construction Liens .
4 Contractors can obtain theform online at under is the purpose of an InformationNotice to Owner about Construction Liens ?The Information notice to Owner about ConstructionLiens explains Oregon lien law and gives steps thatproperty owners can take to protect themselves. Itdescribes the rights and responsibilities of propertyowners and general contractors. If a contractor failsto deliver the notice as required under the law, thecontractor loses the right to claim a lien against must provide and receive anInformation notice to Owner aboutConstruction Liens ?A contractor who contracts to construct or improveresidential property, or who constructs and sells a newresidence, must give the owner or buyer the notice must be given if the Construction contractis for more than $2,000, or if the sale of a newresidence occurs within 75 days of the completion ofconstruction.
5 If the property owner who contracts forconstruction work is a licensed contractor, the noticedoes not have to be given. Note: residential property may include property not occupied by the if the contract price is less than$2,000 but goes over $2,000 during the job?If the contract goes over $2,000 during Construction ,the Information notice to Owner about ConstructionLiens must be mailed or delivered no later than fivedays after the contractor knows that the contractexceeds $2, Required2 The InformationNotice to Owner aboutConstruction Liensexplains Oregon lienlaw and gives stepsthat property ownerscan take to , and how does the Information Noticeto Owner about Construction Liens needto be given?If there is a requirement for a written contract forconstruction, the notice must be given on or before thedate that the contract is signed. Oregon law requires awritten contract for jobs that exceed $2,000.
6 The noticecontains signature lines for both the contractor and theproperty owner. Delivery must be made personally, byregistered or certified mail, or by first class mail with acertificate of the general contractor is the builder-owner and sellsthe residence within 75 days of the completion ofconstruction, the notice must be delivered to the newowner. It must be given at the time the builder-owneragrees to sell the there other information that builder-owners must provide when they sell ahouse?While not a notice requirement, under the 2003 Homebuyer Protection Act, a builder-owner mustprovide protection for the buyer against lien CCB provides a form that the builder-owner shouldcomplete to show how the builder-owner has compliedwith the law. The form, notice of Compliance with theHomebuyer Protection Act (HPA), is available from theCCB at information or warnings must begiven to the property owner by personsother than general contractors who mayclaim a lien?
7 Subcontractors, employees, material suppliers, andequipment rental companies usually must provide aNotice of Right to a Lien to property owners in order toclaim a valid lien if they are not paid. The notice ofRight to a Lien is available online at under Contractor ,employees, materialsuppliers, andequipment rentalcompanies usuallymust provide a Noticeof Right to a Lien toproperty is the purpose of a notice of Right toa Lien?A notice of Right to a Lien lets the property owner knowof the possibility that a lien could be placed on theirproperty by subcontractors, employees, materialsuppliers, and equipment rental companies who arenot paid. A notice of Right to a Lien gives the propertyowner the name of the person who ordered the servicesor materials. It also gives the name of the subcontractor,employee, material, equipment, or service provider anddescribes the materials, equipment, or must provide and receive a notice ofRight to a Lien?
8 Unless the material, equipment, services, or labor wererequested by the property owner, the subcontractors,employees, material suppliers, and equipment rentalcompanies provide a notice of Right to a Lien to theproperty owner. If a person provides labor or labor andmaterials for a commercial improvement, a notice ofRight to a Lien does not need to be given. A commercialimprovement is a structure or building that is notintended for occupancy as a and how does the notice of Right to aLien need to be given?The notice of Right to a Lien may be given at any timeduring the Construction , but it should be given withineight working days of the start date of the work orthe delivery date of the materials or equipment. Ifthe notice was delivered to the property owner on daynine, then the subcontractor or materials providerwould not be entitled to payment for anything thatoccurred on the first day of the job.
9 The notice of Rightto a Lien is considered given when it is personallydelivered or is the difference between a notice ofRight to a Lien and a filed lien?Sending a notice of Right to a Lien is not the same asfiling a lien claim. The notice protects the right of theperson sending the notice to later file the lien. Aconstruction lien should be filed with the recordingofficer in the county or counties where the constructionoccurred. A lien holder has 75 days after completingthe Construction , or ceasing work on the Construction ,in which to file the lien. Only Liens that have beenproperly filed can be enforced by a lawsuit in a notice ofRight to a Lien is notthe same as filing alien can I do after receiving anInformation notice to Owner AboutConstruction Liens or a notice of Right toa Lien?These notices list several ways to protect yourself fromhaving a lien filed on your property: One way is to issue joint checks.
10 A checkcan be written jointly payable to the contractorand to the subcontractor, material supplier,or any other party who gave the property owner aNotice of Right to a Lien. Another way is to use lien waivers orreleases. Before you make any payments toyour contractor, ask every person who gave youa notice of Right to a Lien to provide you with asigned lien waiver or release. Contact anattorney for more information on using lienwaivers or I have any additional rights when Ireceive a notice of Right to a Lien?Yes. A property owner who receives a notice of Rightto a Lien may send a letter to the person who deliveredthe notice demanding: a list of materials or equipment, or a description of labor or services supplied, or a statement of the contractual basis for thematerial, equipment or labor, including apercentage of the contract completed and thecharges person who delivered the notice must respondwithin 15 days of receiving the letter (not includingSaturdays, Sundays, or holidays).
