If you find yourself in the middle of a payment dispute, your best chance of recovering your payment is through a mechanics lien. Most construction participants have lien rights, and you must follow a set of rules and requirements in order for your mechanics lien to be considered valid and enforceable.
In Nevada, you have to serve an important pre-lien notice before you can record a valid mechanics lien. This guide explains everything you need to know about serving the Nevada Notice of Intent to Lien, including steps, deadlines, and best practices.
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- What is a Nevada Notice of Intent to Lien?
- Who must serve a Nevada Notice of Intent to Lien?
- When must you serve a Nevada Notice of Intent to Lien?
- Consequences of not serving a Nevada Notice of Intent to Lien
- How to serve a Nevada Notice of Intent to Lien
- Best practices when serving a Nevada Notice of Intent to Lien
What is a Nevada Notice of Intent to Lien?
A Nevada Notice of Intent to Lien is a document that you serve on the property owner and the general contractor to inform them that you are about to record a mechanics lien against the property involved. As the name suggests, this Nevada pre-lien notice is served when a payment delay or dispute has already come up and you want to exercise your lien rights to recover your payment.
Note that this form is different from the Nevada preliminary notice, which is served at the beginning of a project. The Nevada Notice of Intent to Lien is sent to the property owner only when a payment issue has already arisen and you are considering recording a mechanics lien.
Who must serve a Nevada Notice of Intent to Lien?
The Nevada Notice of Intent to Lien is required only for construction participants in residential projects. These parties include general contractors, subcontractors, and material suppliers who furnish their services to projects relating to single- or multi-family construction or improvement.
Note that laborers are exempted from the Nevada Notice of Intent to lien requirement, even if they are working on residential projects. Also remember that even if you are working on a non-residential project, you may still serve a Notice of Intent to Lien on the property owner or the general contractor, if applicable.
This pre-lien notice serves as a warning to the property owner notifying them that a mechanics lien is about to be recorded on their property. In some instances, serving this pre-lien notice is enough to prompt an owner to release payment.
When must you serve a Nevada Notice of Intent to Lien?
A Nevada Notice of Intent to Lien must be served at least 15 days prior to recording a mechanics lien on a residential project. Be aware that serving this pre-lien notice extends the deadline for recording the actual mechanics lien by 15 days.
In Nevada, a mechanics lien must be recorded within 90 days of your last day of work. If, for instance, you serve the Nevada Notice of Intent to File a Lien on the 89th day after your last day of work, you get an additional 15 days to record your mechanics lien.
Consequences of not serving a Nevada Notice of Intent to Lien
A Notice of Intent to Lien is a strict requirement in Nevada before you can record a valid mechanics lien. Failing to serve this pre-lien notice at least 15 days before you file a mechanics lien will invalidate your lien claim.
In other words, your mechanics lien will most likely fail to get you paid if you do not serve a Notice of Intent to Lien prior to recording your claim. Remember that Nevada is very strict in enforcing its mechanics lien rules, so make sure that you abide by this very important pre-lien requirement.
How to serve a Nevada Notice of Intent to Lien
1. Prepare the Nevada Notice of Intent to Lien form
Nevada does not have a prescribed template for the Notice of Intent to Lien form. However, the laws state that the Notice of Intent to Lien must substantially contain the same information to be included in a Nevada mechanics lien. This means that your Notice of Intent to Lien must include the following details:
- The amount of the original contract
- The total amount of all additional or changed work, materials, and equipment, if any
- The total amount of all payments received to date
- The amount being claimed with the lien after deducting all just credits and offsets
- The name of the property owner
- The name of the party who hired you
- Your name and address
- A brief statement describing the payment terms written in your contract
- A description of the property location sufficient for identification
Note that all pieces of information in your Nevada Notice of Intent to Lien must be accurate to the best of your knowledge. Always verify the correctness of the details and make sure that there are no minor mistakes such as spelling errors and incomplete business names.
When preparing your Notice of Intent to Lien, think of it as if you are also working on your actual Nevada Notice of Lien or mechanics lien. The details that you gather for this pre-lien form are the same ones that you will be writing in your mechanics lien.
2. Deliver the Nevada Notice of Intent to Lien
Once your Notice of Intent to Lien is all set, you have to deliver it to the property owner as well as the general contractor, if applicable. The valid methods of service include personal delivery and registered or certified mail with return receipt requested.
Keep all mailing documents, including receipts for postal stamps, if you decide to mail your Notice of Intent to Lien. If you deliver the document in person, ask the recipient to sign an acknowledgment of receipt form. These steps will help ensure that you have a valid proof of service if your compliance with the rules gets questioned.
Note that the Nevada Notice of Intent to Lien must be filed 15 days before recording the mechanics lien. Serving this notice can extend the mechanics lien deadline by 15 days. However, it is best practice to serve it earlier and not count on the deadline extension.
Best practices when serving a Nevada Notice of Intent to Lien
1. Serve the Notice of Intent to Lien even if not required
Delivering the Notice of Intent to Lien is required in Nevada only for parties who are working on residential construction or improvement projects. However, this does not mean that other parties are not allowed to serve this pre-lien notice.
It is best practice to serve the Notice of Intent to Lien even if not required because it gives you an opportunity to warn a property owner before you record a mechanics lien. Serving this notice is one way to get their attention and doing so can get you paid faster.
2. Serve the Nevada Notice of Intent to Lien early
Even if serving the Notice of Intent to Lien can extend the mechanics lien deadline in Nevada by 15 days, you are still encouraged to serve this pre-lien notice early enough to give the property owner(s) some time to consider releasing payment. If you serve the Notice of Intent to Lien early, the owner might settle the debt right away so you will not have to record a mechanics lien altogether.
Always bear in mind that property owners are wary about having a mechanics lien attached to their property. If they know that you are planning to file a mechanics lien against their property, they will have more reason to settle the outstanding debt just so you do not push through with recording the lien.
3. Do not forget to file the actual Nevada mechanics lien
If payment negotiations are going nowhere even after you serve the Notice of Intent to Lien in Nevada, you must move forward with the plan and file a mechanics lien.
Remember that the Notice of Intent to Lien is simply a declaration of your intention to file a lien. If you want to recover your payment and exercise your lien rights, you have to file an actual Nevada mechanics lien.