A mechanics lien is the most powerful document that you can file to increase your leverage during payment disputes in a construction project. When you record a mechanics lien, you attach a record of debt to a property’s public books so potential buyers and financiers can learn about the outstanding debt.
Property owners are, therefore, wary of dealing with a mechanics lien because it can reduce the market value of their property.
To ensure that all mechanics liens are valid, there are rules and requirements that must be followed. Mechanics lien rules are different in every state.
This guide will explain the process for recording a valid mechanics lien in Rhode Island, from serving the preliminary notice all the way to enforcing or releasing the lien.
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- Who can file a mechanics lien in Rhode Island?
- Preliminary notice in Rhode Island
- When do you file a Rhode Island mechanics lien?
- How to file a mechanics lien in Rhode Island
- Important deadlines to remember when filing a mechanics lien in Rhode Island
- Best practices when filing a mechanics lien in Rhode Island
Who can file a mechanics lien in Rhode Island?
General contractors, subcontractors, and material suppliers are allowed to record a mechanics lien in Rhode Island. Lower-tier parties such as sub-subcontractors also have lien rights, regardless of how far down they are in the contracting chain.
Preliminary notice in Rhode Island
In Rhode Island, serving a preliminary notice, also called Notice of Intention, is the first step in perfecting a mechanics lien. Note that a preliminary notice and a mechanics lien in Rhode Island are essentially the same document: the preliminary notice is first served on the property owner, and the same document is then filed as a mechanics lien with the record of deeds.
Who is required to serve a preliminary notice?
All potential lien claimants in Rhode Island must serve a preliminary notice on the property owner. Doing so is the first step in filing a mechanics lien, so you should serve a preliminary notice regardless of your role in a project.
When do you serve a preliminary notice?
The deadline for serving a preliminary notice in Rhode Island is within 200 days of the last day of work.
Since this preliminary notice is the same as a mechanics lien, you must keep in mind that a Rhode Island mechanics lien only covers the 200-day period prior to the date the lien was filed. This means that if you are working on a long project, you may need to serve multiple preliminary notices.
What happens if you do not serve a preliminary notice?
You will not be allowed to record a mechanics lien in Rhode Island if you did not serve on the property owner a valid preliminary notice.
When do you file a Rhode Island mechanics lien?
The mechanics lien in Rhode Island must be recorded with the town clerk or the recorder of deeds within 200 days of the last day of work. Remember that a mechanics lien only covers the 200-day period before the recordation date. If you are working on a long project or a project that lasts for more than 200 days, you might have to record multiple mechanics liens.
How to file a mechanics lien in Rhode Island
1. Prepare your Rhode Island Notice of Intention form
The Notice of Intent in Rhode Island is the preliminary notice and the mechanics lien at the same time. Rhode Island laws require that you include the following pieces of information in this form:
- The name of the owner of record of the land at the time of the mailing, or in the case of a lien against the interest of any lessee or tenant, the name of the lessee or tenant
- The mailing address of the owner or lessee – the name and address to be located at the upper left hand corner of the notice, in addition to the text of the notice
- A general description of the land sufficient to identify it with reasonable certainty, including, for example only, street name and number, if available;
- A general description of the nature of the work done or to be done, or of the materials furnished, or to be furnished, or both, and their approximate value as of the date of the notice;
- The name and address of the person or persons for whom directly the work has been done or is to be done, or to whom directly the materials have been furnished or are to be furnished;
- The name and address of the person mailing the notice and the name of the individual person or persons whose signature will bind the person so mailing on all matters pertaining to the notice or any lien claimed thereunder, or release thereof.
- A statement that the person mailing the notice has not been paid for the work done or materials furnished or both.
The Notice of Intention must also be substantially in the following form:
Note that the Rhode Island Notice of Intent must be notarized in order to be valid.
2. Serve the Rhode Island Notice of Intention as a preliminary notice
The next step is to serve the Rhode Island Notice of Intention on the property owner as a preliminary notice. Service must be done via certified mail with return receipt requested.
The deadline for serving this preliminary notice is within 200 days of the date you last furnished services to a project. However, note that this 200-day period is the same time frame for recording a mechanics lien. You must serve the notice on the owner prior to filing a mechanics lien with the recorder of deeds.
Be sure to keep a copy of your Rhode Island preliminary notice for yourself. This is the same document that you will use to record a mechanics lien.
3. Record the Rhode Island Notice of Intention as a mechanics lien
After serving the preliminary notice on the owner and the payment dispute is still not settled, you need to file your Notice of Intent with the town clerk or the recorder of deeds in the county where the property is located.
Filing the mechanics lien can be done in person or by mailing your documents to the town clerk’s office. There are filing costs associated with recording a mechanics lien, so be ready to shoulder the associated fees. Also note that if you are filing your documents by mail, your parcel must include the exact amount of the filing costs.
Filing the Rhode Island mechanics lien must be done within 200 days of the last day of work. It is very important to note that all mechanics liens in Rhode Island only cover the 200-day period before the filing date. Keep this mind, especially when you are working on long-running projects. If that’s the case, you will need to find multiple mechanics liens throughout the course of a project.
4. File Notice of Lis Pendens and enforce the mechanics lien
After recording your Rhode Island mechanics lien, your next step will depend on whether you get paid or you don’t. If you receive your payment, you are not obligated by Rhode Island laws to release your mechanics lien. The lien release may be done in discussion between you and the property owner.
If, on the other hand, you do not receive your payment, your next step will be to enforce a mechanics lien. In Rhode Island, a Notice of Lis Pendens must first be filed before recording a Complaint to Enforce the Mechanics Lien.
The Notice of Lis Pendens must be recorded in the superior court of the county where the property in question is located. The Complaint to Enforce the Lien may be recorded in the same court together with the Notice of Lis Pendens; otherwise, it must be filed within 7 days of filing the Notice of Lis Pendens.
Also note that both the Notice of Lis Pendens and the Complaint to Enforce Lien must be recorded within 40 days of filing the Rhode Island mechanics lien. Failing to enforce a mechanics lien within this 40-day period will cause a lien to expire. When a mechanics lien expires, it no longer holds any power over a property and you will lose your strongest leverage during payment negotiations.
Important deadlines to remember when filing a mechanics lien in Rhode Island
Best practices when filing a mechanics lien in Rhode Island
1. Serve the preliminary notice early
The deadline for serving the preliminary notice in Rhode Island is within 200 days of the date you last furnished services to a project. However, this does not mean that you should wait until the 200th day before serving your Notice of Intention. You must serve the preliminary notice before filing the mechanics lien – be sure to serve the preliminary notice early so you meet the deadline for recording the mechanics lien.
2. Do not claim attorney fees and other miscellaneous costs
Rhode Island does not allow its lien claimants to claim attorney fees and lien-related expenses on a mechanics lien. The amount that you claim with Rhode Island mechanics lien must be related to the services that you furnished to a project, and they must be reasonable estimates. Overcharging or claiming a bloated amount could potentially invalidate your mechanics lien.
3. Keep track of the 200-day filing period
The Rhode Island mechanics lien only covers the 200-day period before the filing date. You should keep this in mind when filing a mechanics lien. If you are working on a project that lasts longer than 200 days, be ready to serve multiple preliminary notices and record multiple mechanics liens. It is very important to have a working template and streamline your mechanics lien process so you don’t end up losing your lien rights.