Most states have preliminary notice requirements that construction professionals need to abide by. In some states like Hawaii, however, no party is required to serve a preliminary notice before they are allowed to record a valid mechanics lien.
However, this does not mean that you cannot serve a preliminary notice in the state. There are many benefits to serving a preliminary notice other than preserving one’s lien rights. It establishes communication lines between you and higher-tier parties, and it can also allow you to receive your payment faster.
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This guide details the importance of serving the optional preliminary notice in Hawaii, as well as the procedure for sending it and the best practices to keep in mind.
- Why serve a Hawaii preliminary notice?
- Who must serve a preliminary notice in Hawaii?
- When do you serve a Hawaii preliminary notice?
- What happens if you fail to serve a Hawaii preliminary notice?
- How to serve a Hawaii preliminary notice
- Best practices for serving a Hawaii preliminary notice
Why serve a Hawaii preliminary notice?
1. It shows you are aware of your lien rights as a construction professional.
Serving a preliminary notice is standard in most states, so doing so even if it’s not required by law demonstrates that you are aware of how the construction business works. By giving the property owner a properly prepared document that formally declares your role in a project, you show that you are a professional aware of your legal payment rights in the state.
2. It opens communication lines between you and higher-tier parties.
Handing a preliminary notice to a property owner can be very helpful in establishing communication lines between you and higher-tier parties such as property owners and general contractors. The preliminary notice gives you pretext to introduce yourself to the property owners and let them know that you are part of their project.
3. It can speed up the payment process.
If you are working on a large-scale project, payment issues may come up simply because the higher-tier parties have no direct communication with you and are not aware of your role in the project. By serving a preliminary notice, you break this barrier and you get the owners’ attention. You are more likely to get paid if they are aware of your role in a project.
Who must serve a preliminary notice in Hawaii?
Hawaii does not require any construction project participant to serve a preliminary notice. You may record a mechanics lien without having to serve this construction document. However, you are still strongly advised to serve a preliminary notice as it takes little effort to prepare and it can help you communicate clearly with the property owners.
When do you serve a Hawaii preliminary notice?
There is no deadline for serving a Hawaii preliminary notice as doing so is not required in the state. However, if you choose to serve a preliminary notice, you may do so at the start of your work on a project.
What happens if you fail to serve a Hawaii preliminary notice?
There are no lien-related consequences for failing to deliver a Hawaii preliminary notice. There are benefits to serving a preliminary notice in Hawaii, but doing so is not mandatory.
How to serve a Hawaii preliminary notice
1. Prepare the Hawaii preliminary notice form
There are no statutory requirements for preparing a Hawaii preliminary notice. This means that there is no way your preliminary notice will be declared invalid so long as you include some basic information, such as the following:
- Your name and address
- The name of the party who contracted with you
- The name of the property owner
- The project property description that is sufficient for identification
- The contract amount or a reasonable estimate of the worth of your services
Also include a statement saying that you have the right to record a mechanics lien should you not receive the payment that you are entitled to. Be sure to write your document in formal language and in a format that is clear and legible. Even if there are no statutory requirements for the Hawaii preliminary notice form, it is best practice to make it look professional.
2. Serve the preliminary notice
After preparing and signing your preliminary notice, you may then send it to the property owner. There are no rules for serving a preliminary notice in Hawaii. Serving it via certified mail with return receipt requested should be considered sufficient.
Similarly, there is no deadline for serving a Hawaii preliminary notice. In most states, a preliminary notice is served at the beginning of a project so you can introduce yourself to the property owner as soon as you begin working on a project.
Best practices for serving a Hawaii preliminary notice
1. Serve the Hawaii preliminary notice even if not required
It will greatly benefit you if you serve a preliminary notice in Hawaii even if it is not mandatory. Lower-tier contractors (e.g. subcontractors and suppliers) are strongly advised to serve a preliminary notice as they do not have a direct communication line with the owner. By serving a preliminary notice, you break the communication barrier and you make the owner aware of your participation in the project. In turn, it can potentially help you get paid faster.
2. Ensure that the preliminary notice is free of typographical errors
Your preliminary notice must look professional even if there is no state-specific template for it. It does not have to be heavy on legal language, but it must at least spell the names and addresses correctly and there must be no glaring typographical errors. A Hawaii preliminary notice form is still a formal document, so avoid misspellings and errors.
3. Record a Hawaii mechanics lien if payment disputes arise
When payment issues come up, remember to record a Hawaii mechanics lien. A preliminary notice is not the same as a mechanics lien because it does not get attached to a property’s public records. A mechanics lien in Hawaii can actually limit a property’s market value, so if you need to recover payment from a delinquent client, you should definitely consider filing a Hawaii mechanics lien.