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[dt_fancy_separator separator_style=”dotted” separator_color=”accent” el_width=”95″][dt_fancy_title title=”1. Who May Have A Lien?” title_align=”left” title_size=”h3″ title_color=”accent” separator_style=”dashed”]
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Architects, engineers, landscapers, contractors, subs, la­borers, material suppli­ers, etc., to owner, general or first- or second-tier sub. Suppliers to suppliers do not have lien rights. [18-44-101, 18-44-107; Valley Metal Works v. A.O. Smith, 572 S.W.2d 138 (Ark.1978); American States Ins. Co. v. Tri Tech, Inc., 812 S.W.2d 490 (Ark.App.1991)] Every contractor, subcontractor or material supplier who furnishes or installs soil, drain pipe or tile for drainage of the land has a lien for each tract of 40 acres or less of the real estate upon which the soil, drain pipe or tile is placed. To preserve his or her lien, the claimant must follow all the steps set out in this summary. [18-44-104]

NOTE that where work in excess of $1,000 is per­formed on property owned by a church, religious organi­zation, charitable institu­tion, or by any age­ncy of the foregoing, a bond must be provided. Suit on such a bond must be brought within 6 months after completion of the project. [18-44-504]

NOTE THAT all contractors and subs must be licensed when the contractor’s or sub’s contract is for $50,000 or more and the property is public or private, for rent, resale, public access or similar purpose, except for single-family dwellings. Demolition, area cut, and fill work, and excavation qualify as construction for purposes of the licensing statutes. [17-25-101, 17-25-103; J & J Excavating v. Doyne Const. Co., Inc., 391 S.W.3d 367 (Ct.App.Ark. 2012)]

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Laborers and suppliers to general and subcontractors, and possibly additional tiers. Suppliers to suppliers, however, are not protected. Note that a general contractor may not use unlicensed subcontractors on public projects when the subcontractor’s portion exceeds $20,000 in value. [18-44-503; Schor at §5.02[A]; 22-9-204B; Sweetser Const. Co. v. Newman Bros., Inc., 236 Ark. 939, 371 S.W.2d 515 (Ark. 1963)] All contractors and subs must be licensed when the contractor’s or sub’s contract is for $50,000 or more. Demolition, area cut, and fill work, and excavation qualify as construction for purposes of the licensing statutes. [17-25-101, 17-25-103; J & J Excavating v. Doyne Const. Co., Inc., 391 S.W.3d 367 (Ct.App.Ark. 2012)]

[dt_fancy_separator separator_style=”dotted” separator_color=”accent” el_width=”95″][dt_fancy_title title=”2. What Is The Lien Against?” title_align=”left” title_size=”h3″ title_color=”accent” separator_style=”dashed”]
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The improvement and lot on which it is situated, up to one or more lots or acres. An owner may require the contractor to post a payment and performance bond, which must then be filed with the clerk of the circuit court in the county where the project is located. If this is done, the claimant is recommended to obtain a copy of the bond in case there are any notice requirements. [18-44-101, et seq.; 18-44-505 through 18-44-508] Where the lien is for soil, drain pipe or tile for drainage, the lien is against each real estate tract of 40 acres or less upon which the soil, pipe or tile is placed. [18-44-104]

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Contractor’s payment bond. [18-44-503]

[dt_fancy_separator separator_style=”dotted” separator_color=”accent” el_width=”95″][dt_fancy_title title=”3. Who Must Give The Preliminary Notice?” title_align=”left” title_size=”h3″ title_color=”accent” separator_style=”dashed”]
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RESIDENTIAL REAL ESTATE PROJECTS OF 4 OR FEWER UNITS:

The contractor must give the notice, and if he or she fails to do so, then the contractor is barred from bringing any action to enforce any provision of the residential contract. All other potential claimants may also give the notice. If no one gives it, no one is entitled to a lien. If a sub, supplier, laborer or other claimant gives notice before that claimant commences work or supplies materials, then that notice is effective for all subs, suppliers, laborers and other claimants who furnish labor, materials, etc. thereafter, even if the notice was given after the project has commenced. If a claimant is relying on another claimant’s prelien, then only the labor, materials, or services supplied after the other claimant’s notice was given is protected, so it’s always safest for a claimant to give the notice himself or herself, unless they’re certain that a notice was given before the claimant starts furnishing work, materials, etc. NO ONE is entitled to a lien unless the owner, the owner’s authorized agent, or the owner’s registered agent has received at least one copy of the notice. A contractor who fails to give the notice may be subject to a fine of up to $1,000. NOTE, HOWEVER, that if the contractor supplies a payment and performance bond, then no one is required to give a preliminary notice. [18-44-115]

COMMERCIAL PROJECTS AND RESIDENTIAL PROJECTS OF 5 OR MORE UNITS:

All subcontractors, service providers, material sup­pliers and laborers. Service providers are defined as architects, engineers, surveyors, appraisers, landscapers, abstractors or title insurance agents. [18-44-115]

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No one. NOTE, HOWEVER, that it is up to the claimant to check the public records to verify that a payment bond has in fact been provided by the general contractor. If there is no bond and the claimant did not check, then there will be no recourse against either the public body or the individual owner(s) of the general contractor. [Beebe School District v. National Supply Co., 280 Ark. 340, 658 S.W.2d 372 (1983); Alliance Steel, Inc. v. TNT Const., Inc. 322 S.W.3d 501 (Ark.App.2009)]

[dt_fancy_separator separator_style=”dotted” separator_color=”accent” el_width=”95″][dt_fancy_title title=”4. To Whom Is The Preliminary Notice Given?” title_align=”left” title_size=”h3″ title_color=”accent” separator_style=”dashed”]
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RESIDENTIAL, 4 UNITS OR LESS:

The owne­r, the owner’s authorized agent, or the owner’s registered agent. Failure to give this notice may result in the imposition of a fine of up to $1,000. [18-44-115] BUT if the owner is not a resi­dent of the state or the county in which the property is located, has no agent in the county, or has absented him- or herself, or has ab­sconded, then the notice may be filed with the re­corder, instead. [18-44-116]

COMMERCIAL PROJECTS AND RESIDENTIAL PROJECTS OF 5 OR MORE UNITS:

-Owner, owner’s authorized agent, or owner’s registered agent; and

-Contractor.

Failure to give this notice may result in the imposition of a fine of up to $1,000. [18-44-115]

NOTE THAT if the owner is not a resi­dent of the state or the county in which the property is located, has no agent in the county, or has absented him- or herself, or has ab­sconded, then the notice may be filed with the re­corder instead. [18-44-116]

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Not applicable.

[dt_fancy_separator separator_style=”dotted” separator_color=”accent” el_width=”95″][dt_fancy_title title=”5. When Must Preliminary Notice Be Given?” title_align=”left” title_size=”h3″ title_color=”accent” separator_style=”dashed”]
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RESIDENTIAL, 4 UNITS OR LESS:

Notice must be received prior to the commencement of work, or the supplying of any materials or fixtures. If given by a sub or supplier prior to that claimant furnishing labor, materials, etc., that claimant will be fully protected, and claimants furnishing labor, materials, etc. will be protected as to all labor, materials, etc. furnished as of the effective date of that notice. A case which preceded these notice requirements suggests that if the notice is not given prior to the supplying of any materials or fixtures, it may be possible that no subcontractors have lien rights. The statutory revisions provide that if no notice is ever given, no one has lien rights, but if a notice is given by someone, everyone supplying labor, materials, etc. after that date will be protected. The safest thing is for the claimant to give the notice prior to starting to furnish, labor, materials, etc. [18-44-115; Bryant v. Jim Atkinson Tile, 269 S.W.3d 383 (Ark.App. 2007); Bryant v. Cadena Contracting, Inc. 269 S.W.3d 378 (Ark.App. 2007)]

COMMERCIAL PROJECTS AND RESIDENTIAL PROJECTS OF 5 OR MORE UNITS:

Notice must be sent within 75 days after claimant’s last delivery. [18-44-115; Books-A-Million, Inc. v. Arkansas Painting and Specialties Co., 10 S.W.3d 857, 340 Ark. 467 (2000); Cannon Remodeling & Painting, Inc. v. Marketing Co., Inc., 90 S.W.3d 5, 79 Ark.App. 432 (2002)]

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Not applicable.

[dt_fancy_separator separator_style=”dotted” separator_color=”accent” el_width=”95″][dt_fancy_title title=”6. Contents of Preliminary Notice.” title_align=”left” title_size=”h3″ title_color=”accent” separator_style=”dashed”]
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RESIDENTIAL, 4 UNITS OR LESS:

Please contact Levy von Beck & Associates for this information.

COMMERCIAL PROJECTS AND RESIDENTIAL PROJECTS OF 5 OR MORE UNITS:

-Statement that claimant is currently entitled to pay­ment but has not been paid

-A general descrip­tion of the labor, service, or ma­terial furnished. (It is essential to include some detail. The notice requirements require strict compliance. [Ground Zero Const., Inc. v. Walnut Creek LLC, 410 S.W.3d 579 (Ark.,2012)]) Though perhaps not ideal, describing the labor, service or material furnished as “equipment rental” is sufficient. [Ahern Rentals, Inc. v. Salter Const., Inc., 439 S.W.3d 699 (2014)]

-Amount due and unpaid

-The name and ad­dress of claimant

-The name of the person who contracted for the labor, ser­vice, or ma­terials

-A description of the job­site sufficient for identi­fication

[dt_fancy_title title=”Public:” title_align=”left” title_size=”h4″ separator_style=”disabled”]

Not applicable.

[dt_fancy_separator separator_style=”dotted” separator_color=”accent” el_width=”95″][dt_fancy_title title=”7. How Must Preliminary Notice Be Given?” title_align=”left” title_size=”h3″ title_color=”accent” separator_style=”dashed”]
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Personal service by an officer authorized to serve process in civil actions, or by a form of mail addressed to the person to be served, with a return receipt requested and delivery restricted to the addressee or agent of the addressee, or by any means that provides written, third-party verification of delivery at any place where the owner, the owner’s registered agent, or the owner’s authorized agent maintains an office, conducts business, or resides. When served by mail, the notice is complete when mailed. If delivery of the mail is refused or unclaimed, the claimant must immediately send a copy of the notice by first class mail to the owner, owner’s authorized agent or owner’s registered agent, and the unopened original of the unclaimed/refused envelope will be accepted as proof of service as of the postmarked date of the envelope. Must be signed by the owner if served per­sonally. It may also be incorporated into or affixed to the contract, and printed in boldface type and capital letters. [18-44-115]

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Not applicable.

[dt_fancy_separator separator_style=”dotted” separator_color=”accent” el_width=”95″][dt_fancy_title title=”8. Who Must Give Interim Notice?” title_align=”left” title_size=”h3″ title_color=”accent” separator_style=”dashed”]
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All claimants.  [18-44-114]

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Not applicable.

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Notice that the claimant holds a claim against the improvement, the amount due, and from whom the amount is due. [18-44-114]

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Not applicable.

[dt_fancy_separator separator_style=”dotted” separator_color=”accent” el_width=”95″][dt_fancy_title title=”10. When Must Interim Notice Be Given?” title_align=”left” title_size=”h3″ title_color=”accent” separator_style=”dashed”]
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Notice must be received (or refused) at least ten days prior to filing the lien. [18-44-114]

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Not applicable.

[dt_fancy_separator separator_style=”dotted” separator_color=”accent” el_width=”95″][dt_fancy_title title=”11. Who Must Give Final Notice?” title_align=”left” title_size=”h3″ title_color=”accent” separator_style=”dashed”]
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All claimants. [18-44-117] (According to Schor, a claimant can file suit rather than file the interim and final notices, if suit is brought within 120 days of last delivery. [Schor at §5.03[B], citing case law])

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No one.

[dt_fancy_separator separator_style=”dotted” separator_color=”accent” el_width=”95″][dt_fancy_title title=”12. To Whom Is Final Notice Given?” title_align=”left” title_size=”h3″ title_color=”accent” separator_style=”dashed”]
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Clerk of circuit court.

Notice should also be served on the owner, in the same manner as set out for service of the preliminary and interim notices, in order to preserve the claimant’s potential for recovering attorney’s fees. [18-44-117, 18-44-128]

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Not applicable.

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Filed within 120 days of last delivery. NOTE, HOWEVER, that the lien does not attach until the materials supplied are actually used and incorporated into the improvement.  [18-44-117; Del Mack Const., Inc. v. Owens, 118 S.W.3d 581, 82 Ark.App. 415 (2003)]

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Not applicable.

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Filed with clerk of court.  [18-44-117]

Service on the owner must be either personally served by an officer authorized by law to serve process in a civil action or by a person who would be a competent witness; sent by cert­ified/registered mail, re­turn receipt requested, with delivery restricted to the addressee or agent of the addressee; or delivered by any means that provides written, third-party verification of delivery at any place where the owner maintains an office, conducts business, or resides. When the notice is mailed, service is completed upon mailing. It must be accompanied by the signed return receipt, or the returned envelope and the postal document, or affidavit by a postal employee reciting or showing refusal of the notice by the addressee or that the item was unclaimed.  If delivery is refused or the envelope is unclaimed, then immediately send it by first class mail.  You may then file the lien.  The unopened original envelope marked by the post office as unclaimed or refused functions as proof of service as of the postmarked date on the envelope.  [18-44-114, 18-44-128]

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Not applicable.

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-Just and true account of demand owing, after allowing credits.  NOTE, HOWEVER, that with a cost-plus contract, a contractor is not entitled to claim a lien for its profits.  Hickman v. Kralicek Realty and Const. Co., 129 S.W.3d 317 (2003).

-Description of property

-Sworn statement demonstrating compliance with the preliminary and interim notice requirements, and a copy of each notice must be attached to the statement.

-The entire statement must be verified by affidavit. Neither the statute nor the case law indicates whether anyone other than the claimant is allowed to sign the notice.  [18-44-117]

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Not applicable.

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If the claimant has served the owner with a copy of the lien and wishes to collect attorney’s fees, then the claimant should file the lawsuit more than 20 days after serving the owner.  In all cases, the suit must be brought within 15 months after fil­ing lien. NOTE that a lis pendens must be filed within that time frame as well.  [18-44-119] It may be possible to file suit within 120 days, instead of filing the lien.  (Schor at §5.03[B])  BUT if suing on a BOND for a private works project, suit must be brought within 6 months after final payment on the contract is made.  If suing on a bond on a project involving a reli­gious or charitable insti­tution, then suit must be brought within 6 months of completing project.  [18-44-508, 18-44-504]  NOTE that a lien does not attach until the materials have been actually used and incorporated into the improvement.  [Del Mack Const., Inc. v. Owens, 118 S.W.3d 581, 82 Ark.App. 415 (2003)]  NOTE that where a lis pendens is filed to foreclose on a mortgage, and it is filed after lien claimant’s work is performed but before claimant files its lien, and the mortgage is foreclosed without ever including the lien claimant, the lien claimant’s lien will be barred. [National Home Centers, Inc. v. Coleman,
283 S.W.3d 218, 373 Ark. 246 (Ark.2008)]

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Within one year after final payment is made by the owner to the contractor, EXCEPT that where final approval for payment is given by the Arkansas State Building Services or by an institution of higher education exempt from construction review and approval by Arkansas State Building Services, then the deadline is within 12 months after final payment is APPROVED.  To be safe, it is recommended that a claimant bring his or her action within the earlier time period, i.e. within 12 months of the APPROVAL of final payment.  NOTE that there is a statute that says that there is a 6-month deadline, but Schor believes it is no longer applicable.  It would, though, be safest to give one’s notice within 6 months of the above deadlines.  [22-9-403, 18-44-503; Schor at §5.02[B]]