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1. Who May Have A Lien?

Private:

Registered and licensed contractors and subcontractors, as well as laborers and materials suppliers (including those who supply, rent or lease equipment, materials, fixtures or machinery) and who supply the owner, con­tractor, or at least the first-tier subcontractor with materials, equipment or fixtures. Professional engineers and licensed surveyors are also covered. Suppliers to suppliers are not covered. NOTE that to protect their lien rights, suppliers are strongly encouraged that their sales all reference specific projects, rather than to be conducted on an open account basis. This demonstrates an intent to rely upon the credit of the land for payment, and not simply on the personal credit of the purchaser. NOTE where a claimant begins a project unlicensed but then becomes licensed, the claimant will have lien rights for the labor and materials furnished during the time the claimant was licensed and registered, but not for the labor and materials furnished while unlicensed and unregistered. [ParkWest Homes LLC v. Barnson, 238 P.3d 203 (Idaho,2010); Farrell v. Whiteman, 268 P.3d 458 (2012)] It is not sufficient that one member of an LLC is licensed if the LLC entering the contract is not licensed. [Stonebrook Const., LLC v. Chase Home Finance, LLC, 277 P.3d 374, (Idaho 2012 )] Suppliers that do not install their product do not need to be licensed or registered. If a subcontractor is registered but the general contractor is not, then the sub will still have lien rights as long as the sub didn’t know that the general contractor was unlicensed. Suppliers selling to unlicensed contractors or subs have lien rights as long as they did not know their customer was unlicensed. [45-501; 54-5205 and -5208; BMC West Corp. v. Horkley, 174 P.3d 399 (Idaho 2007); L&W Supply Corp. v. The Chartrand Family Trust, 136 Idaho 738, 40 P.3d 96 (2002)]

Public:

Licensed subcontractors, and suppliers of labor, materials or equipment to general or 1st-tier subcontractor. Where a supplier to the general contractor is performing a major part of the contract (by supplying materials), a supplier to that supplier (i.e., a sub-supplier) will have a claim against the bond. [54-1926; LaGrand Steel Products Co. v. A.S.C. Constructors, Inc., 702 P.2d 855, review denied 776 P.2d 828 (1985); Schor at §§13.01, 13.02[D]] Where the public body fails or neglects to obtain a payment bond, the public body is obligated to the claimants. [54-1928]


2. What Is The Lien Against?

Private:

The structure and land upon which the structure is built, plus convenient space surrounding it.  Note that where the owner owns the building but does not have full ownership of the land, then the lien will attach to the building and whatever ownership interest the owner has in the land. [45-504, 45-505; BMC West Corp. v. Horkley, 174 P.3d 399 (Idaho 2007)]

Public:

Contractor’s payment bond, of at least 85% of contract price. Note that construction managers are required to provide a bond in the total amount of the construction management contract. A construction manager/general contractor must provide payment and performance bonds required of general contractors. [54-1926; 54-4512]


3. Who Must Give The Preliminary Notice?

Private:

The general contractor on a residential project in excess of $2,000, for 1-4 units, whether owner- or non-owner occupied. NOTE that this notice is not required where the homeowner initiates the contact with the contractor in order for the contract to provide repairs necessary to meet a bona fide emergency of the homeowner, or to make necessary electrical, plumbing, or water system repairs. [45-525]

Public:

A preliminary notice is not required.


4. To Whom Is The Preliminary Notice Given?

Private:

The homeowner or purchaser. (Note that an “owner” does not include the trustee of a deed of trust.) [45-525, 45-507]

Public:

Not applicable.


5. When Must Preliminary Notice Be Given?

Private:

Received prior to entering into a contract. [45-525]

Public:

Not applicable.


6. Contents of Preliminary Notice.

Private:

Disclosure statement, including an acknowledgment of receipt to be executed by the homeowner or residential real property purchaser. The general contractor shall retain proof of receipt and shall provide a copy to the homeowner or residential real property purchaser. The disclosure must include specific information.  Please contact Levy von Beck & Associates for this information. [45-525]

Public:

Not applicable.


7. How Must Preliminary Notice Be Given?

Private:

It is “provided to” the homeowner or purchaser – presumably personal delivery, as the form is required to include an acknowledgment of receipt, thus actual receipt is essential. [45-525]

Public:

Not applicable.


8. Who Must Give Interim Notice?

Private:

An interim notice is not required.

Public:

An interim notice is not required.


9. Who Must Give Final Notice?

Private:

Every claimant. [45-507]

Public:

Every claimant that does not have a direct contract with the general. [54-1927]


10. To Whom Is Final Notice Given?

Private:

-County recorder in county where property is located

-Owner or reputed owner. (Note that an “owner” does not include the trustee of a deed of trust.) [45-507]

Public:

General contractor. [54-1927] Consider serving the public entity as well. [Schor at §13.02[D]]


11. When Is Final Notice Given?

Private:

To county recorder:

Filed within 90 days after claimant last furnishes labor or materials. Trivial work done or materials furnished after the contract has been substantially completed will not extend the time for filing a lien. NOTE that for a material supplier furnishing materials on a continuous open account, the relevant date is the date of delivery of the last item of materials, provided those materials were used in the building, that were reasonably necessary to complete the project according to the builder’s contract with the owner, were not trivial, and were not delivered for the purpose of extending the time for claiming a lien or reviving a lien that has expired. [45-507; Schor at §13.03[B]; Franklin Bldg. Supply Co. v. Sumpter, 139 Idaho 846, 87 P.3d 955 (Idaho 2004)]

To owner:

Received within 5 business days after filing. [45-507]

Public:

The notice must be received within 90 days of claimant’s last fur­nishing of labor or materials. Note that the date of last furnishing will be determined by whether performing the labor or furnishing or supplying the material or equipment was done as part of the original contract or to correct defects or make repairs following an inspection. [54-1927; Evco Sound & Electronics, Inc. v. Seaboard Sur. Co., 223 P.3d 740 (Idaho 2009)]


12. How Is Final Notice Given?

Private:

-Filed with county recorder

-Delivered personally or mailed by certified mail to owner at last known address. Timely mailing is crucial. If it cannot be timely mailed, rerecord and timely send it, if possible. [45-507; per Jeff Sykes, ID atty.]

Public:

Registered or certified mail. The consequences of refusal of delivery are not clear, but strongly recommend personal delivery if the mail is refused. [54-1927]


13. Contents of Final Notice

Private:

-Statement of demand, less credits and offsets;

-Name of owner or reputed owner, if known;

-Name of the person by whom claimant was employed or to whom claimant furnished labor or materials;

-Description of property sufficient for identifica­tion;

-Where claim is against 2 or more buildings or improvements owned by same person, claimant must des­ignate amount due on each (failure to do so leads to loss of priority as against other liens). [Hopkins Northwest Fund, LLC v. Landscapes Unlimited, LLC, 264 P.3d 379 (Idaho, 2011)]

-Claim must be verified by the claimant, its agent or its attorney. The verification must identify the person signing the lien, state that the person has read the claim, knows the contents thereof, and believes the same to be true and just, and must then have the affiant’s signature. It must also be acknowledged. The verification (and not just the lien) must also explicitly state that the person signing the lien was first sworn by a person authorized to administer oaths, such as a notary public. The court may be somewhat flexible about the exact language of the verification and acknowledgment, though apparently the signature must be notarized. [45-507, 45-508; Cornerstone Builders Inc. v. McReynolds, 136 Idaho 843, 41 P.3d 271 (App. Ct. 2001); ParkWest Homes LLC v. Barnson, 238 P.3d 203 (Idaho,2010); Allied General Fire and Sec., Inc. v. St. Luke’s Regional Medical Center, Not Reported in P.3d, 2014 WL 1778267 (Ct.App.2014)] NOTE that the court may be very strict about compliance, so be sure that the verification (and every other aspect of the notice) complies with the statute. [First Federal Sav. Bank of Twin Falls v. Riedesel Engineering, Inc., 301 P.3d 632 (Idaho, 2012)]

Public:

-Amount claimed

-Name of person to whom labor or materials furnished. [54-1927]


14. Time to Start Suit / Foreclose?

Private:

Within six months after claim is filed, or, if credit is extended with an expiration date and both the credit and the expiration date are recorded on the lien, then within 6 months after the expiration of the extension of credit. Note that an extension of credit may only be used to postpone the date one time. [45-510] Note that where the last day of the period for filing is a Saturday, Sunday or legal holiday, the period runs until the end of the next day that is not a Saturday, Sunday or holiday. Note also that a motion for leave to amend a complaint in an existing action can suffice to ‘commence’ the action, as long as the motion is filed before the expiration of the six-month period. [Cather v. Kelso, 652 P.2d 188 (Idaho, 1982); Terra-West, Inc. v. Idaho Mut. Trust LLC, 247 P.3d 620 (Idaho, 2010)] NOTE ALSO that in order to preserve one’s claim against subsequent holders of legal title where property is encumbered by a deed of trust, the claimant must timely name the trustee of the deed of trust in the foreclosure suit. The trustee is a necessary party, and if not named, the lien will fail as against the legal title to the property, even if the beneficiary is named. [ParkWest Homes, LLC v. Barnson, 302 P.3d 18 (Idaho,2013); Sims v. ACI Northwest, Inc., 342 P.3d 618 (2015)] NOTE that where a lien release bond is posted, the claimant’s recovery against the bond is limited to the amount the claimant would have recovered in a foreclosure action against the property. Thus if the claimant’s claim was subordinate to a mortgage, it remains subordinate. [American Bank v. Wadsworth Golf Const. Co. of the Southwest , 307 P.3d 1212 (Idaho 2013)]

Public:

Payment Bond:

Suppliers, laborers, etc.: More than 90 days but less than 1 year after claimant last fur­nishes labor or materials

Subcontractors of the contractor: More than 90 days after claimant last works on the project, but less than 1 year after payment became due from the general contractor. [54-1927]

Where no payment bond is provided:

Within one year after the furnishing of labor or materials. [54-1928]