What you need to know:
- Any person who performs labor or furnishes material may file a lien on the real estate that received the labor or materials
- You must serve a pre-lien notice if the amount is over $10,000
- You must serve your pre-lien notice within 75 days
- You must file your lien within 120 days
- You have one year to file your lawsuit to foreclose your lien
- You may seek reimbursement for all costs and attorney fees in your suit
The Problems faced by Mechanics, Builders, Plumbers and Other Contractors in Oklahoma
You were called to perform a job. You quoted a fee or provided an estimate, the customer agreed, and you did your job. Now they don’t want to pay you. Sound familiar?
Those involved in the business of providing construction services or materials have to deal with these problems all the time. The customer says they agree to the price, but after you’ve finished the job, paid your crew, obtained the materials on credit, with interest now accruing, they all of a sudden dispute the bill. Funny (or sad really) how this happens all too often.
Thankfully, Oklahoma law gives you a legal remedy. You just have to know how to use it. This article will explain how you can protect your interests and collect the money due.
Your Right to File a Lien to Secure Payment for your Labor and Materials
Any person who performs labor or supplies material shall have a lien on the real estate that received the labor or material. This includes services for planting trees or other plants, as well as traditional construction services, such as plumbing, roofing, electrical, and any remodel work.
Importance of Written Estimates and Contracts
Oral contracts are valid and enforceable in Oklahoma. However, without neutral witnesses, they can be harder to prove. To avoid any problems, always prepare your estimate in writing. Then when the customer agrees, have the customer sign the estimate.
If there are reasons why the final bill may vary from the estimate, be sure to explain that in your estimate. This can be accomplished by providing the hourly rate and how the bill can vary depending on the final amount of hours spent versus the initial estimate of how long it would take. Or you can explain how other circumstances can alter the final amount, such as discovery of problems within frame of the house, plumbing, etc.
The Pre-Lien Notice Requirement
If you supplied labor or materials for a job on a residential property, you do not need to serve a pre-lien notice. Residential property is defined as a single-family home, a duplex, triplex, or four-plex. If it has five units, it’s considered commercial.
If you are seeking less than $10,000, you also do not need to send a pre-lien notice.
If you preformed a job for an apartment building or any type of commercial property, amounting to $10,000 or more, you must serve a pre-lien notice within 75 days of the last day you performed any work.
(Even if you’re bill is less than $10,000, it doesn’t hurt to send a pre-lien notice anyway as a precaution; it may even help settle your claim).
The Form of your Pre-Lien Notice
The pre-lien notice shall be in writing and shall contain, but not be limited to, the following:
- A statement that the notice is a pre-lien notice;
- the complete name, address, and telephone number of the claimant, or the claimant’s representative;
- the date of supply of material, services, labor, or equipment;
- a description of the material, services, labor, or equipment;
- the name and last-known address of the person who requested that the claimant provide the material, services, labor, or equipment;
- the address, legal description, or location of the property to which the material, services, labor, or equipment has been supplied,
- a statement of the dollar amount of the material, services, labor, or equipment furnished or to be furnished, and
- the signature of the claimant, or the claimant’s representative.
You should serve the pre-lien notice by hand-delivery or by certified mail.
How a subcontractor should serve the notice.
Subcontractors should serve the notice to the owner of the property, as well as to the General Contractor. If you do not know the name and address of the owner of the property (after all, you were hired by the GC, not the owner), then you should demand to the general contractor that it notify you of the correct name and address for the owner within five days.
If the general contractor fails to provide this information within five days, then the owner cannot enforce the pre-lien notice requirement against you.
Filing the Lien Statement
You should file your Lien in the county where the property is located, at the County Clerk, land records office. The statement should contain:
- Your name or your company’s name,
- The amount claimed,
- A description of the labor or materials,
- The names of the owner and/or the contractor, and
- The legal description of the property subject to the lien.
The lien statement must be verified, meaning signed and notarized. (Note: It is a felony to file a false lien).
The hardest part of the Lien Statement requirements is obtaining the legal description of the property. You will need to have a copy of the deed or search the county land records to obtain the correct legal description.
Enforcing the Lien: foreclosure and selling the property
Just because you filed a lien, your job is not over with. Your lien will remain on file until the property either sells or is foreclosed, whether by you or another lien holder such as a bank.
In order to recover the fruits of your labor immediately, you must foreclose on your lien. The process of foreclosing your lien involves:
- Filing a lawsuit,
- Notifying (i.e. serving) all other lien holders, including mortgagees, of the suit,
- Going through the litigation process to obtain judgment, and
- Selling the property at a sheriff’s sale.
If there are other liens on the property, they will be paid according to legal priority.
Hiring a Lawyer to do all of this for you
If you performed labor or supplied materials for any type of real estate construction, you deserve to be paid. Travis Charles Smith will represent you on a contingency basis, which means he will not charge any legal fees up front, and will not get paid until you get paid. If you would like to know more, please call us at (405) 724-8112 or send us an email with your contact information.
Legal notice: The laws described in this blog post are always subject to change by the Oklahoma legislature. The most recent changes occurred in November 2011. At the time of publication, this information is accurate, but the author cannot forever guarantee accuracy, since the legislature often amends or alters the procedural or substantive aspects of mechanic’s lien law. This is why you should consult an attorney or review the most recent publication of the Oklahoma Statutes before relying on any of the foregoing information. Or you may contact us with any questions you have.