In most states, construction professionals must serve a preliminary notice on the property owner before they can file a mechanics lien. This requirement is intended to secure the construction project participants’ lien rights, as well as inform the property owner of the professionals’ participation in the project.
However, not all states impose a preliminary notice requirement. In Nebraska, a preliminary notice is not mandatory among construction project participants, but it is still a very important document that you should know about.
There are many benefits to serving a preliminary notice on the owner even if you are not obligated to do so. This guide explains why it is important to still submit a preliminary notice and what the specific steps are to ensure that you serve a Nebraska preliminary notice that works.
- Why serve a Nebraska preliminary notice?
- Who must serve a preliminary notice in Nebraska?
- When do you serve a Nebraska preliminary notice?
- What happens if you fail to serve a Nebraska preliminary notice?
- How to serve a Nebraska preliminary notice
- Best practices for serving a Nebraska preliminary notice
Why serve a Nebraska preliminary notice?
Construction project participants sometimes assume that serving a preliminary notice is like handing a threat to a property owner. This is not true. Serving a preliminary notice is a standard practice in construction, and doing so actually demonstrates professionalism and awareness of good business practices.
Aside from that, there are other benefits to reap if you serve a Nebraska preliminary notice. The following are just some of the reasons why you should consider delivering a preliminary notice in Nebraska:
1. It informs the property owner about your participation in a project.
Lower-tier parties will greatly benefit from serving a preliminary notice in Nebraska, especially if they are working on a large-scale project. Property owners cannot always keep track of which parties are working on their projects, which means that they might also lose track of which parties need to get paid. If you serve them a preliminary notice, they will know that you are part of the project and they are most likely to pay attention if payment disputes arise.
2. It opens communication lines between you and the property owner.
One of the most common roots of payment issues in construction is the lack of proper communication between the participants and the stakeholders involved. Serving a preliminary notice may solve this problem. By serving a Nebraska preliminary notice on the property owner, you are able to communicate with them and let them know how they can reach you.
3. It can get you paid faster.
If a property owner is aware that you are working on their project and you have already communicated with them, you stand a better chance of receiving your payment. You have already caught their attention by serving a preliminary notice — if payment disputes come up, they will be more open to settling the issue because they already know what you have done for the project.
Who must serve a preliminary notice in Nebraska?
Technically, no party is required to serve a preliminary notice in Nebraska. However, any potential lien claimant may serve a preliminary notice to establish communication lines with the property owner.
When do you serve a Nebraska preliminary notice?
You may choose to serve a Nebraska preliminary notice early on in a project. In most states, a preliminary notice is served within the first week or the first month of your first day at work.
What happens if you fail to serve a Nebraska preliminary notice?
There are no consequences for failing to serve a Nebraska preliminary notice. However, it is always best practice to serve a preliminary notice for a better chance of receiving your payment.
How to serve a Nebraska preliminary notice
1. Prepare the Nebraska preliminary notice form
Because the Nebraska preliminary notice is optional, there are no specific rules on how you should prepare your document. You can use this to your advantage. In some states, small mistakes such as missing information or minor misspelling can invalidate a preliminary notice and revoke a party’s lien rights. There are no such strict rules in Nebraska so you can prepare a simple preliminary notice form with just the basic details.
A good rule of thumb is to include the details that you might need in case you end up filing a mechanics lien. The following information may be included in your Nebraska preliminary notice:
- Your name and address
- The name of the party who contracted 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 that says you are aware of your mechanics lien rights and that you will be exercising your rights if you do not receive the amount that has been agreed upon.
2. Serve the preliminary notice
When your Nebraska preliminary notice form is ready, you may now serve it on the property owner. You may serve your preliminary notice via personal delivery or certified mail with return receipt requested.
Keep a copy of your Nebraska preliminary notice so you can go back to it in case disputes come up. If you are working for a general contractor, you may also want to serve on them a copy of your Nebraska preliminary notice.
Best practices for serving a Nebraska preliminary notice
1. Serve a preliminary notice even if not required
A preliminary notice is not required in Nebraska, but serving one has important perks that can help you get paid. By serving a preliminary notice, you bridge the communication gap between yourself and other higher-tier parties, plus you also demonstrate professionalism and awareness of best business practices in construction. Serving a preliminary notice in Nebraska is a good gesture that does not require much effort but allows you to reap relevant benefits.
2. Include information that you might need for a mechanics lien
There are no strict requirements as to what information must be in your Nebraska preliminary notice. It is, therefore, a good idea to start collecting the details that you might need in case you have to file a mechanics lien down the road. These details are as basic as the name and address of the property owner, as well as a reasonable property description. Having these details on hand ease up the mechanics lien process just in case.
3. Do not forget to file a Nebraska mechanics lien if needed
Filing a mechanics lien is still the best tool for payment recovery if payment disputes come up. When these payment issues arise, you should file a mechanics lien even if you have already served a Nebraska preliminary notice. The preliminary notice is just an informal document, while the mechanics lien is a legal attachment to the property’s public records. A mechanics lien will always be your best weapon against non-payment.