Payment issues in a construction project can be tricky to solve. If you are ever involved in a payment dispute and you want to successfully recover your payment, the best thing to do is to file a mechanics lien.
A mechanics lien acts as a record of debt that gets attached to a property’s public files. When you record a lien, potential investors of the property will be able to see your claim and will think twice about investing in the property in question. Property owners are, therefore, more willing to settle outstanding debts once a mechanics lien enters the picture.
However, filing a mechanics lien requires you to follow strict rules and deadlines. This guide will walk you through the process of filing a mechanics lien in the state of Maine.
- Who can file a mechanics lien in Maine?
- Preliminary notice in Maine
- When do you file a Maine mechanics lien?
- How to file a mechanics lien in Maine
- Best practices when filing a mechanics lien in Maine
Who can file a mechanics lien in Maine?
General contractors, subcontractors, and material suppliers in a construction project can file a mechanics lien in Maine. Other parties that have lien rights in Maine include architects, surveyors, engineers, and others.
Preliminary notice in Maine
In the mechanics lien process, filing a preliminary notice is often required to preserve lien rights. Technically, Maine does not require any of its participants to serve a preliminary notice. However, serving a preliminary notice can ensure that lower-tier contractors are protected.
For instance, property owners in owner-occupied projects are by default only obligated to pay the general contractors. If the general contractor does not disburse the payment to their subcontractors, the lower-tier contractors are not allowed to seek out the owner for payment unless they served a preliminary notice.
Furthermore, a property may also be bought lien-free by bona-fide purchasers unless a mechanics lien has been enforced or a Maine preliminary notice has been filed. It is, therefore, best practice to still serve or file a Maine preliminary notice even if it is not required to do so.
When do you serve a preliminary notice?
There is no deadline for serving the preliminary notice in Maine. However, if you choose to serve or file one, you should do it as soon as possible after commencing work on a project.
What must be included in your preliminary notice?
A Maine preliminary notice should include the following information:
- a description of the property sufficiently accurate to identify it
- the names of the owners
- a statement declaring that the claimant is going to perform or furnish, is performing or furnishing or has performed or furnished labor, materials or services
- a statement that the claimant may claim a mechanics lien
The Maine preliminary notice that you serve on the property owner must also include the following statement at the top of the document:
Under Maine law, your failure to assure that …………………………………………………………………….. (name of the claimant giving notice) is paid before further payment by you to
…………………………………………………………………….. (name of contractor) may result in your paying twice.
What happens if you do not serve a preliminary notice?
Technically, there are no direct lien-related consequences for failing to serve a preliminary notice in Maine. However, note that serving a preliminary notice can potentially protect your lien rights, especially if you are a lower-tier contractor working on an owner-occupied project.
When do you file a Maine mechanics lien?
In Maine, a mechanics lien must be filed within 90 days of the date when you last furnished labor or services to a project.
Note that general contractors are allowed to enforce a mechanics lien in court without first filing a lien with the Registry of Deeds. The deadline for mechanics lien enforcement is within 120 days of the date you last provided services to a project.
How to file a mechanics lien in Maine
1. Prepare your Maine mechanics lien form
Your Maine mechanics lien must have the following details:
- the names of the parties (e.g. property owner, hiring party)
- your name, address and telephone number
- a true statement of the amount due, with all just credits given
- a description of the property that is sufficiently accurate to identify
Note that your Maine mechanics lien form must be notarized prior to filing.
2. Record the Maine mechanics lien
The next step is to record your mechanics lien in the office of the Registry of Deeds of the county where the project is located. Recording may be done by walking into the office and filing the mechanics lien in person, or by mailing your documents.
When mailing your documents to the Registry of Deeds, be sure to first inquire about the filing fees associated with recording a mechanics lien. You need to include the exact filing costs in your parcel before your mechanics lien may be recorded.
Take note of the deadline for filing a mechanics lien in Maine. For those without a direct contractual relationship with the property owner (e.g. subcontractors, suppliers), you need to record the mechanics lien with the Registry of Deeds within 90 days of the date you last provided labor or materials to the project.
The deadline for filing a mechanics lien is strictly enforced in Maine. Missing this deadline is fatal to your mechanics lien claim.
Also note that general contractors may skip filing the mechanics lien with Registry of Deeds altogether. General contractors in Maine are allowed to record a mechanics lien along with enforcement in court (see Step 4).
3. Serve a copy of the mechanics lien on the owner
In Maine, parties who file a mechanics lien with the Registry of Deeds must serve a copy of the mechanics lien on the property owner. Maine statutes state that you can serve the copy of the mechanics lien via “ordinary mail,” but make sure to have a post office certificate of mailing as proof of receipt.
It is best practice to complete this step by mailing a copy of the mechanics lien via certified mail with return receipt requested.
4. Enforce/release the mechanics lien
Your next step will depend on whether you get paid or not after you record your mechanics lien in Maine.
If you receive your payment, you have 60 days after the mechanics lien has been satisfied to file a lien release. You can file this document in the same Registry of Deeds where the original mechanics lien was recorded.
If you do not get paid, you need to enforce the mechanics lien by filing a lien complaint in court. Note that general contractors may go straight to this step. The deadline for enforcing a mechanics lien in Maine is within 120 days of the date you last provided services to a project.
After filing a lien complaint in court, you need to file a certificate from the clerk of court or an attested copy of the lien complaint with the Registry of Deeds. This is separate from the original mechanics lien that you may have already recorded earlier. You need to file this document within 60 days of filing the lien complaint.
Keep in mind that failing to file a certificate from the clerk of court with the Registry of Deeds will not necessarily invalidate your mechanics lien. However, if a property gets purchased by a bona fide purchaser, they may be able to get the property lien-free.
Best practices when filing a mechanics lien in Maine
1. Serve a preliminary notice even if it is not required
Even though Maine does not impose preliminary notice requirements on any of its potential lien claimants, serving a preliminary notice allows certain participants to retain their lien rights if payment disputes come up. Lower-tier contractors in owner-occupied projects in Maine are specifically advised to serve a preliminary notice so they can protect their payment rights.
When including a true statement of your payment claim, be sure to stick to the contract amount or the amount that is related to the services that you furnished to the project. Attorney costs, lien fees, and other miscellaneous expenses that have nothing to do with your construction services are not allowed to be included in a Maine mechanics lien claim.
3. Record an attested copy of the enforcement complaint with the Registry of Deeds
After enforcing your mechanics lien by filing a formal complaint in court, be sure to get a certificate from the clerk of court or have an attested copy of the mechanics lien complaint – either of these documents should be filed with the Registry of Deeds. Skipping this step will not revoke your mechanics lien, but it protects your claim on the property in case the property gets bought by a bona fide purchaser.