Filing a mechanics lien in Montana is slightly different from other states. There are strict regulations concerning the preliminary notice — the Notice of Right to Claim lien — and copies of the mechanics lien are served before you file the document.
If you are working on a construction project in Montana, you can use this step-by-step guide to walk you through the basic steps when filing a mechanics lien in the state.
- Sending a Notice of Right to Claim Lien
- Who are required to file a Notice of Right to Claim Lien in Montana?
- What information should be on the Montana Notice of Right to Claim Lien form?
- When should the Notice of Right to Claim Lien be sent?
- Who should the Notice of Right to Claim Lien be sent? How should the notice be sent?
- Must a Notice of Right to Claim Lien be filed at a county clerk’s office?
- Can a Notice of Right to Claim Lien be filed online?
- How to File a Montana Mechanics Lien: 4 Steps
- 3 Common Mistakes When Filing a Montana Mechanics Lien
Sending a Notice of Right to Claim Lien
Sending a Notice of Right to Claim Lien is required for most construction participants in Montana who have the right to file a mechanics lien. Failure to send this preliminary notice nullifies your lien rights, so you must always keep this step a top priority every time you start on a construction project in Montana.
Who are required to file a Notice of Right to Claim Lien in Montana?
The Montana statute only specifies who are NOT required to send this notice. According to statute M.C.A 71-3-531(1), all construction participants must serve this notice, except for the following:
a) an original contractor who furnishes services or materials directly to the owner at the owner’s request;
b) a wage earner or laborer who performs personal labor services for a person furnishing any service or material pursuant to a real estate improvement contract;
c) a person who furnishes services or materials pursuant to a real estate improvement contract that relates to a dwelling for five or more families; and
d) a person who furnishes services or materials pursuant to a real estate improvement contract that relates to an improvement that is partly or wholly commercial in character.
What information should be on the Montana Notice of Right to Claim Lien form?
The following information must be on the Notice of Right to Claim Lien:
- date of mailing (to the property owner)
- owner’s name and address
- name and address of person filing the notice
- a description sufficient to identify the property
The notice must also be in the specific form shown below. Ensure that all the necessary statements are included in your form:
When should the Notice of Right to Claim Lien be sent?
The Notice of Right to Claim Lien must be sent within 20 days after the first day for furnishing labor or materials to the project. Failure to submit this preliminary notice within the 20-day period would limit the coverage of the mechanics lien to just the last 20 days prior to when this notice is given.
Who should the Notice of Right to Claim Lien be sent? How should the notice be sent?
The Notice of Right to Claim Lien must be sent to the property owner by certified mail or by personal delivery to the owner. If sent via certified mail, the notice becomes effective on the date of mailing. If sent via personal delivery, a written acknowledgement of receipt must be signed by the owner.
Must a Notice of Right to Claim Lien be filed at a county clerk’s office?
Yes. The Notice of Right to Claim Lien must be filed the country clerk’s office where the project is located within 5 days after serving the notice to the property owner. The notice will expire in the books after one year.
Can a Notice of Right to Claim Lien be filed online?
Montana also allows claimants to file the Notice of Right to Claim Lien online, as long as the notice is signed electronically. Handle can take care of filing this preliminary notice for you, from making sure that all the necessary information and statements are included to recording the document before the deadline.
How to File a Montana Mechanics Lien: 4 Steps
- Prepare the mechanics lien form
- Serve a copy of the mechanics lien to the property owner
- Record the mechanics lien
- Enforce the mechanics lien
1. Prepare the mechanics lien form
Once you have served and filed the Notice of Right to Claim Lien and payment dispute has arisen, you have to prepare your mechanics lien form.
What information must be on the Montana mechanics lien form?
The Montana construction lien must have the following information for it to be considered enforceable:
- name and address of claimant
- property description that is sufficient for identification
- name of property owner
- name of general contractor
- name of contractor the claimant is in direct contact with
- description of services or materials provided
- amount unpaid
- dates of first and last day of furnishing service / materials to the project
- date of serving the Notice of Right to Claim Lien
- reason why service of Notice of Right to Claim Lien is not required, if applicable
The Montana mechanics lien form must substantially be in this form:
2. Serve a copy of the lien on the property owner
Unlike other states, Montana requires a lien claimant to serve a copy of the lien to the property owners before the mechanics lien is filed. The county clerk has the right to refuse recording a lien unless a certification is provided that copies of the lien have been sent to each property owner.
Service of the mechanics lien copies must be made by personal service or by mailing a copy of the lien by certified mail with return receipt requested. Personal delivery must be made to each property owner, and certified mail must be sent to each owner’s last-known address.
If you choose to serve the mechanics lien by certified mail, the certification must state that service was made by such method. If you deliver the mechanics lien copies in person, ensure that you keep a proof of receipt in writing.
Another option available is to serve the mechanics lien copies to each property owner online. Handle can handle this administrative task, not only by verifying that your mechanics lien document has been filled out properly, but also by ensuring that the copies are sent to all property owners prior to recording it at the registry.
3. Record the mechanics lien
Once the mechanics lien is ready and copies of it have been served to all property owners, you can now record the mechanics lien in the county clerk’s office where the project is located. Note that the Montana mechanics lien must be filed within 90 days after:
- the final day of furnishing services or materials to the property; or
- the day the owner files a valid Notice of Completion.
Must a Montana mechanics lien be notarized?
No, the Montana statutes do not require the mechanics lien form to be notarized for it to be enforceable.
Can you file Montana mechanics lien online?
Yes, Handle can file the Montana mechanics lien for you. Handle can take charge of all your lien-related process, from preparing your preliminary notice to filing the actual mechanics lien. Handle ensures that your documents are filled properly and are sent on time.
4. Enforce the mechanics lien
The Montana mechanics lien expires 2 years after it is filed. If you are doubtful that you will get paid, you must initiate a foreclosure action before the 2-year expiry window. Doing this step ensures that you exhaust all the means to secure that payment that you earned. Failing to file suit before the lien expires will get you no money for your services in the project.
3 Common Mistakes When Filing a Montana Mechanics Lien
1. Not filing a Notice of Right to Claim Lien properly
There are three main things to remember about the Montana preliminary notice:
- It must be served within 20 days after your first day of work
- It must contain specific information and must follow a specific form
- It must be filed at the county clerk’s office within 5 days after serving a copy to the property owner
2. Overstating the unpaid amount
The amount that you claim in any mechanics lien must be specific to the services that you have provided to the project. You must NOT include attorney costs and other lien-related fees in your calculation.
3. Failing to serve the mechanics lien to the owner(s) before filing it
Montana requires the construction lien to be served to all property owners before it can be recorded. The county clerk may refuse to record a lien if you fail to provide a certification that you have completed this step.