You missed the preliminary notice. Now what?
Lien rights depend on notices going out on time, and in most companies no one is assigned to send them.
The deadlines and the rules change from state to state, and whether a late notice can be fixed is a question for an attorney. What a company can control is who owns the notices before the deadlines come due. In a company with the work assigned, the accounting team sends the lien waivers with each pay application, keeps a weekly aging report and sends the notice of nonpayment when the contract's deadline passes. National Lien Services handles preliminary notices, mechanics liens and waiver management for subcontractors who would rather not do it in house.
Three moves, in order
Step 08: Standards and accountability
Five hours a month of owner time, spent projecting the work.
Other problems step 08 solves
Other things that go wrong
What owners ask
Can I still lien if I missed the pre lien notice?
Lien rights depend on notices going out on time, and in most companies no one is assigned to send them. The deadlines and the rules change from state to state, and whether a late notice can be fixed is a question for an attorney. What a company can control is who owns the notices before the deadlines come due. In a company with the work assigned, the accounting team sends the lien waivers with each pay application, keeps a weekly aging report and sends the notice of nonpayment when the contract's deadline passes. National Lien Services handles preliminary notices, mechanics liens and waiver management for subcontractors who would rather not do it in house.
Which part of the system fixes this?
The step is number 08, standards and accountability. Five hours a month of owner time, spent projecting the work. It's drawn from chapter 8 of CONTROL: C.F.O.S. Construction Financial Operating System.
Is this normal for my trade?
Across the 48 trades that publish a figure, net profit at $1M to $5M averages 7% after taxes. If you're well under that and this page describes your month, the two are usually the same story. The published average tells you where the pack is, and your own job costing tells you where you are, which is the number that pays payroll.
Where do I start?
Write the notice dates on the project when the accounting team opens it, so the deadlines exist from the first day.
Can I fix this without touching anything else?
You can try, and it doesn't hold. Step 08 depends on step 03, overhead calculation and step 06, project management and step 07, monthly cadence. Install it ahead of those and it produces numbers the field won't trust, which is worse than the problem you started with.
Wrote CONTROL, the 8 step system behind these figures. More about the author.