Kentucky State Lien Law Summary

Furnishers of labor or ma­terials to the owner, contrac­tor, at least the first- and second-tier subs, architect or au­thorized agent. There is no apparent limit to the remoteness of a subcontractor; all will have lien rights. Suppliers to suppliers, however, do not have lien rights. [376.010, 376.075; Brock v. Pilot Corp., 234 S.W.3d 381 (Ky.App.,2007); Woodson Bend, Inc. v. Masters’ Supply, Inc., 571 S.W.2d 95 (Ky.App. 1978); Hightower v. Bailey, 108 Ky. 198, 49 L.R.A. 255 (1942)] But note that lien amount cannot exceed the contract price between the owner and gen­eral. Note that engineers, landscape architects, architects, land surveyors, and, in certain situations, real estate brokers, may also have a lien, if they contract directly with the owner or the owner’s agent. They are required to give final notice, but no preliminary notice. The details for their claims are not set out in this summary. Note that per case law, a supplier to a supplier has no lien rights, but a supplier to a remote subcontractor, where the materials are delivered off site, will have lien rights. [376.010 and case law; 376.075; Hightower v. Bailey, 56 S.W. 147 ( Ky. 1900)]

NOTE that where subcontractor claimant fails to timely file a lien, the sub may be allowed to bring a claim for unjust enrichment. [Brown Sprinkler Corp. v. Somerset-Pulaski County Development Foundation, Inc., 335 S.W.3d 455 (Ky.App.2010)]

CONTRACT FUNDS:

All furnishers of labor, mate­rials, or supplies to at least the general or sub. But note that lien amount cannot exceed the contract price between the public body and gen­eral. [376.210]

PAYMENT BOND:

Everyone who furnished labor or materials to the general or the general’s subs. Suppliers to suppliers are not covered. Rental equipment is included in the definition of “supplies,” and is therefore covered. [45A.190; Schor at §18.02[D]; 376.195; Safeco Ins. Co. of America v. W.B. Browning Const. Co., Inc., 886 F.2d 807 (6th Cir. 1989); ABCO-BRAMER, Inc. v. Markel Ins. Co. 55 S.W.3d 841 (Ky.App. 2000), review denied] Note that fringe benefits are part of labor and may be included in the claim. [Reliance Ins. Co. v. Com., Dept. of Transp., 576 S.W.2d 231 (Ky.App., 1978)]

Improvements and land upon which they were made. Note that the lien cannot exceed the amount of the general contract.   [376.010]

CONTRACT FUNDS:

Public funds due the con­tractor. [376.210]

PAYMENT BOND:

Contractor’s payment bond. [45A.190] The contractor or subcontractor can also post a bond to discharge a lien. [376.212]

All claimants who contract with someone other than the owner. NOTE: To obtain priority over mortgage holders without notice or the lien, who obtain the mortgage after the lien, the claimant needs to file a notice with the county clerk. If this notice is given, then the claimant will have priority over subsequent mortgages. BUT NOTE that if the claimant gives this notice, the lien actually filed cannot exceed the amount set out in the notice, so there are both risks and benefits. See also “Special Notes”, below. [376.010]

CONTRACT FUNDS:

All claimants. If the notice is given, the claim will be effective as of the date of filing this notice; if it is not given, the claim is effective as of the date of filing the final Statement of Lien. Where the project is a public highway or on property owned by the state or by a city, county, urban-county or charter county government, the lien is limited to the unpaid balance due the contractor from the time a copy of the statement, attested by the county clerk, is delivered to the owner or owner’s authorized agent with whom the contract was made. [376.210]

PAYMENT BOND:

No statutory provisions, therefore you need to obtain a copy of the bond to determine the requirements in the bond itself. [Schor at §18.02[D]]

OWNER OCCUPIED SINGLE OR DOUBLE FAMILY DWELLING:

Owner-occupant or auth­orized agent (not including general or sub).

ALL OTHER PROJECTS:

Owner or au­thorized agent.  NOTE that general contractor is usually not the agent of the owner for notice purposes. Where claim is against leased property, it may be sufficient to notify only the tenant, but strongly recommend notifying property owner as well. [376.010; Brock v. Pilot Corp., 234 S.W.3d 381 (Ky.App.,2007); Taylor v. Trogden, Not Reported in S.W.3d, 2004 WL 690495 (Ky.App.2004) ]

OPTIONAL NOTICE FOR PRIORITY OVER MORTGAGES:

County clerk in the county where the property is located. [376.010]

CONTRACT FUNDS:

– Where the project is a public highway or is on property owned by the state or by a city, county, urban-county or charter county government, it is filed only with the county clerk where the seat of the governmental body that owns the property is located. Where the project is on public property owned by some other entity, then the notice is filed in the office of the clerk of each county in which the claimant has undertaken to furnish labor, materials, or supplies.

-A copy of this notice, attested to by the county clerk, is then given to the owner or owner’s agent with whom the contract was made. [376.210]

PAYMENT BOND:

No statutory provisions, therefore you need to obtain a copy of the bond to determine the requirements in the bond itself. [Schor at §18.02[D]]

OWNER OCCUPIED DWELLING:

Notice must be received within 75 days after claimant’s last delivery. BUT if the owner has paid the general before receiv­ing this notice, then clai­mant cannot bring a claim for work performed or mate­rials supplied prior to the payment. Therefore, it is STRONGLY recommended that this notice be sent earli­er. [Tri-County Wood Preserving, Inc. v. Spear, Not Reported in S.W.3d, 2006 WL 200946 (Ky.App. 2006)]

ALL OTHER PROJECTS:

Notice must be received within 75 days after last delivery for claim of $1,000 or less, and within 120 days after last delivery for larger claims. [376.010]

OPTIONAL NOTICE FOR PRIORITY OVER MORTGAGES:

No specific time, but prior to the recording of the mortgage. [376.010]

CONTRACT FUNDS:

Filed prior to filing lien, but the sooner the better be­cause the lien only relates back to date of filing this notice, AND ALSO because, where the project is on property owned by the state or by a city, county, urban-county or charter county government, the amount payable is limited to unpaid balance due the general con­tractor at the time a copy of this notice, attested to by the county clerk, is received by the owner. [376.210]

PAYMENT BOND:

No statutory provisions, therefore recommend obtaining a copy of the bond to determine the requirements in the bond itself. [Schor at §18.02[D]]

OWNER OCCUPIED DWELLING:

-Delivery of mat­erial/performance of labor

-Intent to hold property liable

-Amount for which lien will be claimed.

ALL OTHER PROJECTS:

-Intention to hold property liable

-Amount for which lien will be claimed. [376.010]

OPTIONAL NOTICE FOR PRIORITY OVER MORTGAGES:

-A statement showing that the claimant has furnished or expects to furnish labor or materials

-The amount in full that claimant has furnished or expects to furnish. REMEMBER that the lien cannot exceed the amount stated in this notice.

-Description of property sufficient for identifica­tion

-Name of owner, if known

-Whether materials were furnished by contract with owner, general or sub

-Name and address of claimant. Note that if claimant is a corpora­tion, must include name and address of corporation’s process agent, or address where corporation can be served.

-Subscribed and sworn to by claimant or someone on claimant’s behalf. Per case law, the claimant’s attorney may sign the claim [376.010; 376.080]

CONTRACT FUNDS:

-That claimant has undertak­en and expects to furnish labor, materials or sup­plies

-Price at which labor, mate­rials or supplies are fur­nished

-That lien shall relate back and take effect from date of filing of statement. [376.210]

PAYMENT BOND:

No statutory provisions, therefore you need to obtain a copy of the bond to determine the requirements in the bond itself. [Schor at §18.02[D]]

ALL PROJECTS:

First class mail, but sending cer­ti­fied or registered mail as well is recommended, as proof of mailing is required.

OPTIONAL NOTICE FOR PRIORITY OVER MORTGAGES:

File with the county clerk.

[376.010]

CONTRACT FUNDS:

-Filed with county clerk

-Have copy attested to by clerk, and then deliver to public body. [376.210]

PAYMENT BOND:

No statutory provisions, therefore you need to obtain a copy of the bond to determine the requirements in the bond itself. [Schor at §18.02[D]]

An interim notice is not required.

An interim notice is not required.

All claimants. [376.080]

CONTRACT FUNDS:

All claimants. [376.230]

PAYMENT BOND:

No statutory provisions, therefore you need to obtain a copy of the bond to determine the requirements in the bond itself. [Schor at §18.02[D]]

-County clerk

-Owner. [376.080] NOTE that general contractor is usually not the agent of the owner for notice purposes. [Brock v. Pilot Corp., 234 S.W.3d 381 (Ky.App.,2007)]

CONTRACT FUNDS:

-Where the project is a bridge, public highway, or is on other property owned by the state or by a city, county, urban-county, charter county, or consolidated local government, it is filed only with the county clerk where the seat of the governmental body that owns the property is located. Where the project is on public property owned by some other entity, then the notice is filed in the office of the clerk of each county in which the claimant has furnished labor, materials, or supplies. [376.230]

-Public authority making contract

-Contractor or sub. [376.240]

PAYMENT BOND:

No statutory provisions, therefore you need to obtain a copy of the bond to determine the requirements in the bond itself. [Schor at §18.02[D]]

FILED WITH THE COUNTY CLERK:

-Within 6 months after last delivery; and

MAILED TO OWNER:

-Within 7 days of filing. [376.080] Apparently the mailing must occur within 7 days AFTER filing. If the notice is sent before filing, it may be considered inadequate notice, especially if any accompanying correspondence does not make it clear that the lien is about to be filed. [Kindred Homes Inc. v. Colvin, Not Reported in S.W.3d, 2006 WL 335974 (Ky.App. 2006)]

AFTER A CONTRACTOR OBTAINS A JUDGMENT AGAINST A CONTRACTING ENTITY FOR FAILURE TO MAKE TIMELY PAYMENTS:

-The contractor has 60 days from the date of judgment to file a lien, except on residential projects. [Ch.371]

CONTRACT FUNDS:

Received within 60 days after last day of month in which the claimant furnished labor, materials or supplies, or within 60 days after the date of substantial completion, whichever is LATER. The sooner the better, though, because giv­ing all three notices gives claimant priority over later claimants. (See “Contents of final notice” section, below.) NOTE, however, that a sub’s lien attaches only to the funds due to and actually earned by the contractor at the time of filing its lien. [376.230, 376.210; McLean County v. Meuth Carpet Supply, 573 S.W.2d 340 (Ky. 1978)] NOTE THAT according to Schor, this notice is to be given within 60 days of the end of the last month in which the claimant furnished materials, though the statute does not specify this. [376.230; Schor update at 18.03[G]

PAYMENT BOND:

No statutory provisions, therefore recommend obtaining a copy of the bond to determine the requirements in the bond itself. [Schor at §18.02[D]]

-Filed with county clerk

-Mailed by REGULAR mail to owner within 7 days of fil­ing. [376.080]

CONTRACT FUNDS:

-File with county clerk of county where seat of govern­ment of owner of property is located

-Deliver an attested copy to public body, along with a signed letter showing that an attested copy was also delivered to the contractor and sub, AND along with the post office receipts showing that the letter and statement were sent.

-An attested copy of the notice and a signed letter (presumably a cover letter) must be sent by registered or certified mail, return receipt requested, to the contractor and sub. Proof of such mailing is apparently sufficient; proving actual receipt is not necessary. [376.230, 376.240]

PAYMENT BOND:

No statutory provisions, therefore you need to obtain a copy of the bond to determine the requirements in the bond itself. [Schor at §18.02[D]]

-Amount due with all cred­its and setoffs (Note that the lien cannot exceed the amount of the contract between the owner and the general contractor. NOTE also that if the claimant files the optional preliminary notice to preserve priority over subsequent mortgages without notice, then the lien cannot exceed the amount stated in that notice.) [376.010]

-Description of property sufficient for identifica­tion

-Name of owner, if known

-Whether labor or materials were furnished by contract with owner, general or sub

-Last date of delivery, or date work was completed. (Schor at §18.03[C])

-Name and address of claimant. Note that if claimant is a corpora­tion, must include name and address of corporation’s process agent, or address where corporation can be served.

-Subscribed and sworn to before a notary, by the claimant or someone on claimant’s behalf. An acknowledgement alone is insufficient. Per case law, the claimant’s attorney may sign the claim. [376.080]

Note that a valid and properly perfected lien will not be invalidated solely because the proof of service does not strictly comply with the statute. [Forcht Bank, NA v. Denny, Not Reported in S.W.3d, 2013 WL 2120272 (2013)]

CONTRACT FUNDS:

Notice to clerk:

-Amount due (Note that the amount recoverable is limited to the unpaid balance owed the general con­tractor at the time a copy of the preliminary notice, attested to by the county clerk, is given to the public entity. [376.210])

-Date of last delivery

-Name of public improvement

-Verified by affidavit of claimant, agent or attorney.

To the contractor and sub:

-Cover letter

-Attested copy of lien stat­ement.

To public body:

-Copy of lien attested to by clerk

-Signed copy of cover let­ter and post office receipt showing mailing to contrac­tor and sub

-Post office re­ceipt showing that at­tested copy of the lien was sent to the con­tractor and subcon­tractor by certified mail, return re­ceipt requested or by regis­tered mail.

In other words, file the notice with the clerk and have the clerk attest to two or three copies of the notice. Then send the general and sub (if there is one) an attested copy, along with a cover letter showing that attested copy of lien statement is enclosed. Then send the public body an attested copy of the lien and a signed copy of the letter to the contractor and sub, along with the return receipt. [376.2­30, 376.240]

PAYMENT BOND:

No statutory provisions, therefore you need to obtain a copy of the bond to determine the requirements in the bond itself. [Schor at §18.02[D]]

Within 12 months from the date of filing. An additional 6 months may be allowed if owner dies during filing period. NOTE that 12-month deadline applies to a mechanic’s lien release bond, as well. [376.090; Gil Ruehl Mechanical, Inc. v. Hartford Fire Ins. Co., 164 S.W.3d. 512, (Ky.App. 2004)] Note that the statutory requirement that a lien foreclosure suit be brought in the county in which the property in question is located will override a contractual provision requiring that suit be brought in a different county. [Morel Const. Co. LLC v. Richardson Bulldozing, LLC, Not Reported in S.W.3d, 2014 WL 3548144 (Ky.App. 2014)]

CONTRACT FUNDS:

Suit is only necessary where contractor protests lienor’s claim within 30 days after delivery of notice of claim. If the contractor does not protest, the contractor loses all defenses to the claim, and the public body automatically pays claimant. If suit is necessary, it must be filed and served on the pub­lic authority within 30 days after written notice of the protest is mailed to the claimant by the public authority. If the suit is not timely filed, the funds are released and paid to the contractor. [376.250] NOTE, HOWEVER, that if public body does not release funds and general does not pro­test, claimant has 6 months from date of filing claim to sue. [376.260]

PAYMENT BOND:

No statutory provisions, therefore you need to obtain a copy of the bond to determine the requirements in the bond itself. [Schor at §18.02[D]]