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How to File a New Hampshire Mechanics Lien

How to File a New Hampshire Mechanics Lien

February 3, 2020

A mechanics lien is arguably the best tool that you can use to secure payment from delinquent clients. Once a mechanics lien is recorded against a property’s records, buyers and financiers would think twice about purchasing or funding the property. Construction parties can, therefore, use a mechanics lien as a leverage to encourage property owners to pay them their fees.

In most states, mechanics lien laws favor a construction party’s right to receive the full payment that they duly earned. However, a mechanics lien also protects property owners by requiring potential lien claimants to follow specific rules and regulations in order to prove that they have a valid lien claim.

In New Hampshire, these rules and regulations are a little different from those of other states. Potential lien claimants in New Hampshire are required to initiate a court action first before they can record a valid mechanics lien. Certain parties must also fulfill preliminary notice and monthly accounting requirements.

This guide explains the specific steps that you must go through if you want to record a valid mechanics lien in New Hampshire.

Who can file a mechanics lien in New Hampshire?

All construction parties — general contractors, subcontractors and material suppliers — are allowed to file a mechanics lien in New Hampshire. Lower-tier parties such as sub-subcontractors and suppliers to subcontractors also have lien rights.

Pre-lien Notices in New Hampshire

There are two important pre-lien notices that you must keep in mind in New Hampshire: the Notice of Intent to Claim Lien and the monthly written accounting of service. Note that these notices are required only for parties who do not have a direct contract with a property owner.

Both notices are served on the property owner of the project.

Notice of Intent to Claim Lien

There is no specific deadline as to when you must serve the Notice of Intent to Claim Lien in New Hampshire. However, be aware that your mechanics lien may only cover the amount that is yet to be paid to the general contractor.

If, for example, you serve a notice of intent after a property owner has already paid $30,000 of the full $100,000 amount to the general contractor – you may only recover payment from the remaining $70,000. You are, therefore, encouraged to serve a Notice of Intent to Lien as soon as a payment dispute arises.

The following pieces of information are typically included in a Notice of Intent to Claim Lien:

  • Your name and address
  • The name and address of the property owner
  • The name and address of the party that hired you
  • A description of the property location
  • The type of service that you have provided or will provide to the project
  • A statement that informs the property owner your willingness to record a mechanics lien if you do not get paid for your work

Monthly written accounting of service

The monthly written account of services is sent every 30 days to the property owner. It is generally an itemized list of your invoices clearly stating the balance due to you for the previous month.

It is best practice to serve the monthly written account at the beginning of each month. While failing to serve this written account on a regular basis will not invalidate your lien rights, it is still highly advised that you adhere to this notice requirement religiously.

When you serve a monthly written account, the property owner becomes obligated to keep a sufficient amount that matches the balance that you are still waiting to receive. The property owner then becomes liable to pay you if the party who owes you the money does not settle the outstanding payment.

How to file a New Hampshire mechanics lien

How to file a New Hampshire mechanics lien

1. Initiate a lawsuit to enforce a mechanics lien

In New Hampshire, you must first initiate a legal action before you can record a mechanics lien. Unlike in other states, you are expected to first file a legal petition to secure a mechanics lien before you visit the local clerk’s office to record the lien claim.

Filing the legal petition must be done before the deadline for recording the mechanics lien elapses. In New Hampshire, you must file a mechanics lien within 120 days of your last day of work. Your last day of work is the day when you last provided labor or materials to a project.

Note that you may initiate the legal action ex parte, which means that you do not have to notify a property owner that you have filed a petition to have a mechanics lien against their property. When the court grants your petition to secure to the lien, that’s when you can finally record a mechanics lien against the property.

Filing a petition in court requires legal expertise – you are encouraged to do this step with the help of a legal counsel.

2. Record the New Hampshire mechanics lien in the local county clerk’s office

There are no specific forms that you must fill for a New Hampshire mechanics lien, and there is also no required information that you have to include. In general, the New Hampshire mechanics lien will have the same information that you collected for your petition to secure a lien. Some of these pieces of information are:

  • Your name and address
  • The name and address of the property owner
  • The name and address of the party that hired you
  • A description of the property location
  • A brief description of the service that you provided to the project
  • The total contract amount
  • The amount that you are claiming

Note that the New Hampshire mechanics lien does not have to be notarized. It must be recorded in the local county clerk’s office where the project is located within 120 days of your last day of work. Note that this deadline does not get pushed back depending on when the court grants your petition in the previous step.

Also, be aware that recording a mechanics lien comes with certain fees, so be ready to pay these fees when you file your mechanics lien. You may call the local clerk’s office in advance to know how much they charge when recording a mechanics lien.

New Hampshire mechanics notarization

3. Serve a copy of the mechanics lien on the property owner

Once you have recorded a mechanics lien, you are now required by law to notify the property owner that a mechanics lien has been formally filed against their property. There is no hard-and-fast deadline for when to serve a copy of the mechanics lien, and there are also no prescribed methods on how to serve it.

You are encouraged to serve a copy of the mechanics lien on the property owner as soon as possible. Letting them know about your lien claim could encourage them to finally pay up and speed up the process of getting you paid.

4. Withdraw the lawsuit if the lien is satisfied

If your mechanics lien works and you finally receive the full payment that you duly earned, you have to withdraw the court action that you have earlier initiated. There are no specific deadlines as to when you must withdraw the legal action.

Serving a New Hampshire mechanics lien

Best practices when filing a mechanics lien in New Hampshire

1. Serve the preliminary notice as early as possible

Serving the Notice of Intent to Claim Lien as early as you can is very important to ensure full protection of your lien rights. If you serve it after the general contractor has already been paid part of the full contract amount, you might limit the pool of funds from which you may recover payment in case a dispute comes up.

Note that serving a Notice of Intent to Claim Lien may be enough to encourage a property owner to settle outstanding debts. Dealing with a mechanics lien is quite stressful for all parties, and some owners would rather settle the payment disputes before they further escalate into a legal court battle.

2. Initiate the legal action before the 120-day mechanics lien deadline

You must remember that the deadline for filing a mechanics lien in New Hampshire for all parties falls on the 120th day after your last day of work. This deadline does not get extended depending on when the court grants your petition to claim lien.

Always take this deadline into consideration when initiating your court action. You should not wait until the last minute before initiating the petition; otherwise, you may not have enough time to record your mechanics lien.

3. Keep your books and paperwork organized

You must organize your invoices, shipping receipts, and all other paperwork all throughout the course of a project. In New Hampshire, you are expected to serve a monthly accounting of services and you must also initiate a court action before you even record a valid mechanics lien.

If your books are organized, fulfilling the monthly notice requirement and collecting the information needed for your legal petition would be much easier. It helps you gather your evidence quicker and gives you more time to double-check the information that you include in your lien-related documents.

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