Every person who furnishes or procures labor, materials, services, plans or specifications, regardless of tier. [779.01; Schor at §§50.01, 50.04[B]]
1. Who May Have A Lien?
Private:
Public:
PAYMENT BOND:
Every person who performs, furnishes or procures labor, services, materials, plans or specifications to the prime contractor or a first-tier sub. Note, however, that only first-tier subcontractors can bring a claim on a highway project [779.14, Schor at §50.01]
CONTRACT FUNDS:
Suppliers of labor or materials to prime contractor. [779.15, Schor at §50.01]
2. What Is The Lien Against?
Private:
-Owner’s interest in the land.
-Contractor’s payment bond, if the contract provides that the prime contractor shall provide one. In this case, all subs’ and suppliers’ claims are against the bond, not the owner’s real property. [779.01, 779.035, 779.036]
-Funds due the prime or subcontractor, BUT ONLY where contractor provides a bond along with the contract. [779.01, 779.036] NOTE that where a lender is not required to obtain lien waivers before disbursing contract funds, a subcontractor will have no claim against a lender for negligent disbursement. [Hoida, Inc. v. M&I Midstate Bank, 2006 WI 69, 717 N.W.2d 17 (2006)]
Public:
-Contractors payment bond. NOTE that where a village failed to require the prime contractor to obtain payment and performance bonds, the village was liable to the subcontractors for the failure to require the bonds. [779.14; Holmen Concrete Products Co. v. Hardy Const. Co., Inc. 686 N.W.2d 705 (App. 2004)]
-Funds due prime contractor. [779.14, 779.15]
3. Who Must Give The Preliminary Notice?
Private:
REAL PROPERTY:
There are two different forms. One must be given by all Prime Contractors who contract directly with the owner and who contract with any subcontractor or material supplier. The second preliminary notice must be given by all contractors, subs and suppliers who are not in privity with owner. HOWEVER, no notice is required where: (1) the project is wholly residential and provides or adds more than 4 family residential units, OR (2) where the project is all or part non-residential (which means if the project is all or part commercial, a notice is not required), OR (3) where the prime contractor is actually an owner of the property. [779.02]
PAYMENT BOND:
All claimants other than the prime contractor, EXCEPT that in the following circumstances, the claimant need not give notice: where the claimant is (1) an employee of the prime, sub or supplier; (2) a sub or supplier whose contract is less than $5,000; or (3) a sub or supplier listed in a written contract between the prime and a sub or supplier. [779.01, 779.035, 779.036] Recommend obtaining a copy of the bond itself, to ensure there aren’t any additional notice requirements set out in the bond. [Schor at §50.02[A]]
CONTRACT FUNDS:
No one. NOTE, HOWEVER, that the (final) notice that is required to protect a claimant’s rights to the contract funds must be received BEFORE the payment is made to the prime contractor or sub. [779.036]
Public:
PAYMENT BOND:
All suppliers and subcontractors, except where the claimant’s contract was for less than $5,000, the claimant is an employee of the prime or sub, or the claimant was listed in the contract between the prime and sub. Recommend obtaining a copy of the bond itself, to ensure there aren’t any additional notice requirements set out in the bond. [779.14; Schor at §50.02[A]]
CONTRACT FUNDS:
No one.
4. To Whom Is The Preliminary Notice Given?
Private:
REAL PROPERTY:
-Prime Contractor’s Notice: Owner or owner’s agent. [779.02]
-Sub’s and Supplier’s Notice: Owner or owner’s agent. [779.02]
PAYMENT BOND:
Prime contractor [779.035]
CONTRACT FUNDS:
Not applicable.Enter Text Here.
Public:
PAYMENT BOND:
To the prime contractor. [779.14]
5. When Must Preliminary Notice Be Given?
Private:
REAL PROPERTY:
-Prime Contractor’s Notice: Included in the written contract (if there is one) or received by Owner within 10 days after the first labor or materials are provided to the project by or through the authority of the prime contractor. NOTE that if the contractor fails to give this notice, the contractor loses all lien rights UNLESS the contractor pays all its subs, suppliers and service providers, and either (a) the time for those potential claimants to give preliens has elapsed without any preliens being given, or (b) all of the prime contractor’s subs, suppliers and service providers have waived all lien rights. [779.02; Schor at §50.04[C]]
-Subs’ and Suppliers’ Notice: Notice must be received within 60 days of first performing, furnishing or procuring labor, services, etc., and at least 30 days before filing lien. If given more than 60 days after first delivery, then only covers materials supplied after the owner receives notice. [779.02]
PAYMENT BOND:
Notice must be received (“provided”) within 60 days of claimant’s first delivery. [779.035]
CONTRACT FUNDS:
None required, BUT NOTE, HOWEVER, that the notice that is required to protect a claimant’s rights to the contract funds must be received BEFORE the payment is made to the prime contractor or sub, so the sooner notice is received, the better. [779.036]
Public:
PAYMENT BOND:
Notice must be received within 60 days after claimant’s first delivery. [779.14]
6. Contents of Preliminary Notice.
Private:
REAL PROPERTY:
-Prime Contractor’s Notice: Please contact Levy von Beck & Associates for further information.
-Subs’ and Suppliers’ Notice: Please contact Levy von Beck & Associates for further information.
PAYMENT BOND:
Notice that the claimant is furnishing labor or materials to the project. [779.035]
CONTRACT FUNDS:
Not applicable.
Public:
PAYMENT BOND:
Notice that the subcontractor or supplier has provided or will provide labor or materials to the project. [779.14]
7. How Must Preliminary Notice Be Given?
Private:
REAL PROPERTY:
-Prime Contractor’s Notice: Personal service, registered or certified mail, service in the same manner as for a summons, or any other means of delivery in which the recipient gives a written confirmation of the delivery. Actual receipt of the notice is essential. (779.02, 779.01)
-Subs’ and Suppliers’ Notice: Two signed copies, delivered by personal service, registered or certified mail, service in the same manner as for a summons, or any other means of delivery in which the recipient gives a written confirmation of the delivery. Actual receipt of the notice is essential. [779.02, 779.06]
PAYMENT BOND:
No specific provision, therefore personal service or registered mail recommended.
CONTRACT FUNDS:
Not applicable.
Public:
PAYMENT BOND:
Served on the prime contractor, in other words, via personal service, registered or certified mail, service in the same manner as for a summons, or any other means of delivery in which the recipient gives a written confirmation of the delivery. It is not entirely clear, but it appears that actual receipt is essential. (779.14, 779.01)
8. Who Must Give Interim Notice?
Private:
REAL PROPERTY:
All claimants. (NOTE: SHOULD BE SIGNED BY THE CLAIMANT.) [779.06]
PAYMENT BOND:
Not applicable. Recommend obtaining a copy of the bond itself, to ensure there aren’t any additional notice requirements set out in the bond. [Schor at §50.02[A]]
CONTRACT FUNDS:
Not applicable.
Public:
Not applicable. Recommend obtaining a copy of the bond itself, to ensure there aren’t any additional notice requirements set out in the bond. [Schor at §50.02[A]]
9. Contents of Interim Notice.
Private:
REAL PROPERTY:
-Notice of intent to file a lien claim.
–SHOULD BE SIGNED BY THE CLAIMANT. NOT THE CLAIMANT’S ATTORNEY.
-Brief description of the nature of the claim
-Amount of the claim
-Description of the land and improvement to which claim relates. [779.06]
Public:
Not applicable.
10. When Must Interim Notice Be Given?
Private:
REAL PROPERTY:
At least 30 days before filing lien, so, within 5 months after claimant’s last delivery. Statute says notice must be timely served, but case law says for this notice service is complete upon mailing. [779.06; Torke/Wirth/Pujara, Ltd. v. Lakeshore Towers of Racine, 531 N.W.2d 419, 192 Wis.2d 481(App. 1995)]
Public:
Not applicable.
11. Who Must Give Final Notice?
Private:
All claimants making claims against the real property or the contract funds. Those making claims against the payment bond need only give the notice listed in the “preliminary notice” sections, above. [779.06, 779.035] Recommend obtaining a copy of the bond itself, to ensure there aren’t any additional notice requirements set out in the bond. [Schor at §50.02[A]]
Public:
PAYMENT BOND:
No specific provision. Note, however, that there are apparently special procedures for public improvement liens for public works for the City of Milwaukee. [See Schor, Forms section, at §§51.35 and 51.36.] Recommend obtaining a copy of the bond itself, to ensure there aren’t any additional notice requirements set out in the bond. [779.14; Schor at §50.02[A]]
CONTRACT FUNDS:
All claimants
12. To Whom Is Final Notice Given?
Private:
REAL PROPERTY:
Clerk of circuit court where property is located, and owner of the property.
PAYMENT BOND:
Not applicable.
CONTRACT FUNDS:
Owner or authorized agent, mortgage lender, and prime or sub [779.036, 779.06]
Public:
PAYMENT BOND:
No specific provision; recommended to give notice as required for contract funds and also a copy to the surety.
CONTRACT FUNDS:
-Clerk of municipality, or the state department, board, etc. in charge of work
-Prime contractor. [779.14; 779.15]
13. When Is Final Notice Given?
Private:
REAL PROPERTY:
Filed in the circuit court within six months after claimant’s last delivery and at least 30 days after filing the notice of intent (interim notice, above), and served on the property owner within 30 days after filing the lien. Notice to the owner is apparently effective upon mailing, though recommend that it be timely received. [779.06; Torke/Wirth/Pujara, Ltd. v. Lakeshore Towers of Racine, 531 N.W.2d 419 (App. 1995)]
PAYMENT BOND:
Not applicable; only notice required is preliminary notice, given within 60 days of first delivery.
CONTRACT FUNDS:
-To owner and mortgage lender: Received before payment is made to the prime or sub
-To contractor or subcontractor: Received within seven days after service on owner or lender. [779.06, 779.035, 779.036; Torke/Wirth/
Pujara, Ltd. v. Lakeshore Towers of Racine, 531 N.W.2d 419 (App. 1995)]
Public:
PAYMENT BOND:
No specific provision; recommended to follow same procedure as for contract funds.
CONTRACT FUNDS:
Before payment is made to prime contractor [779.15]
14. How Is Final Notice Given?
Private:
REAL PROPERTY:
Filed with court clerk, served on the owner via personal service, registered or certified mail, service in the same manner as for a summons, or any other means of delivery in which the recipient gives a written confirmation of the delivery. The consequences of refusal of delivery of the notice are unclear, but it is likely that actual receipt is essential.
PAYMENT BOND:
Not applicable.
CONTRACT FUNDS:
Personal service, registered or certified mail, service in the same manner as for a summons, or any other means of delivery in which the recipient gives a written confirmation of the delivery. Actual receipt is essential. [779.036, 779.06, 779.01]
Public:
PAYMENT BOND:
No specific provision-recommended to follow same procedure as for contract funds.
CONTRACT FUNDS:
Served, via personal service, registered or certified mail, service in the same manner as for a summons, or any other means of delivery in which the recipient gives a written confirmation of the delivery. Actual receipt is essential. [779.15]
15. Contents of Final Notice
Private:
REAL PROPERTY:
-Attach copy of preliminary notice and interim notice
-Statement of contract or demand upon which lien is founded
-Name of person against whom demand is claimed
-Name of claimant and assignee, if any
-Last date of delivery or performance
-Legal description of property
-Statement of amount claimed
-All other material facts
-Signed by claimant or attorney
-Need not be verified [779.06]
PAYMENT BOND:
Not applicable.
CONTRACT FUNDS:
Notice of claim same as above is recommended [776.036]
Public:
PAYMENT BOND AND CONTRACT FUNDS:
No specific provision-recommend inclusion of amount, project location and name, name of claimant, name of party who requested work or materials, last delivery date.
16. Time to Start Suit / Foreclose?
Private:
REAL PROPERTY:
Within two years after filing lien. [779.06]
PAYMENT BOND:
Within one year after completion of the contract for the construction of the improvement [779.035, 779.036]
CONTRACT FUNDS:
Suit is only necessary where (1) the prime contractor or sub disputes the claimant’s claim by serving written notice on the owner and lien claimant within 30 days of receiving notice; or (2) where the total claims exceed the amount due to the prime or sub, the prime or sub do not dispute the debts, the owner and lender figure out a pro rata distribution plan, serve notice of their determination on all the claimants, and someone objects. Otherwise the funds will be paid out within 20 days after service of the determination.
If the claim is less than the sums due to the prime or sub, and the prime or sub does not dispute it, then the sums are to be paid out to the claimant “on demand.”
In the first situation discussed above, where the prime or sub disputes the claim, suit must be brought within three months after the claimant served the notice on owner and lender. (Note that this may be only 2 months after claimant receives notice of dispute.)
In the second situation discussed above, any objecting claimant, or the prime contractor or subcontractor who objects, must bring a suit within 20 days of the mailing of that notice by the owner or lender. If no one sues, then the amounts will be paid out accordingly. This action must be brought within the EARLIER of 20 days of mailing of the notice, or six months after completion of the work. [779.036]
Public:
PAYMENT BOND:
Within one year after the completion of work under the contract. (The statute is unclear, but per Schor it is within one year of the work under the PRIME contract.) [779.14; Schor at §50.02[A]. See also Arbor Vitae-Woodruff Joint School Dist. No. 1 v. Gulf Ins. Co. 639 N.W.2d 788, 250 Wis.2d 637 (App. 2001).]
CONTRACT FUNDS:
Suit not necessary unless contractor disputes lien by serving written notice on the public body and the claimant within 30 days of receiving notice. If contractor does dispute it, suit must be brought within three months after claimant served notice on owner and lender. If there are several claims which combined exceed amount due contractor, if contractor doesn’t bring suit, claimant must bring one within 3 months after completion of the work. Claimant must also file, with the same officer with whom the notice of the claim was filed, a notice of bringing the action. This notice must be filed within the same 3 month time period.
If the prime contractor does not dispute the claims, but the claims exceed the amount due to the contractor, then the state will determine who is to be paid and how much, and will send the claimants a notice setting out the state’s plan. If the claimant disagrees with the state, then the claimant must bring suit within 20 days of the state mailing its notice. Per Schor, this 20-day deadline is controlling: if the determination by the state is mailed more than 3 months after acceptance of the work, then suit is timely if commenced within 20 days of receiving the determination, but if the determination is mailed earlier, suit must still be filed within 20 days, even if it’s before the 3-month deadline. [779.15; Schor at §50.03]
