Sending a Michigan preliminary notice is an effective way to speed up payment on a construction project. A preliminary notice is an informational document typically sent to the property owner near the beginning of a construction project. Here's what you need to know about the rules and requirements for sending preliminary notice in Michigan.
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General contractors are not required to send notice on private projects.
General contractors are not required to send preliminary notice on public projects.
Since GCs will not make a claim against their own bond for non-payment, they do not have bond claim rights, and have no preliminary notice requirement.
Subcontractors and suppliers must provide notice on private projects.
This deadline is extended for laborers, who have 30 days after wages were due, and not paid, to serve notice. Additionally, subs must provide a sworn statement like the GC on residential projects, prior to receipt of payment.
2nd-tier subcontractors and suppliers must send notice on public projects.
Suppliers or others who contract with the GC are not specifically required to send preliminary notice.
TopicThere are a lot of rules and requirements surrounding providing Michigan preliminary notices, so it's important to make sure that you get the details right. Different notices can be required at different times depending on the specific project and the work being done. It can be a harder than it should be to make sure that the notice you're sending is effective and correct. Here are some frequently asked questions (and answers) about the Michigan preliminary notice process.
Prime contractors are not generally required to send any type of preliminary notice in Michigan. However, if requested by the owner, they must provide a list of subcontractors and suppliers on the project.
All other parties who didn’t contract directly with the property owner must provide a Notice of Furnishing on all private construction projects.
Lastly, on residential projects, Sworn Statements must be provided to the owner (by the prime contractor) and to the prime contractor (by subcontractors) before receiving any progress or final payments. The statement must list all subs, sub-subs, suppliers, and laborers, with whom the party contracted, and lists the amounts paid to them; if any.
A Notice of Furnishing should generally be provided no later than 20 days after first furnishing labor and/or materials to the project. If a Notice of Commencement (NOC) has not been recorded or provided after sending a request, notice should be sent within 20 days after the NOC was filed or received. If the claimant is a wage laborer, then notice must be given within 30 days from when wages became due.
However, quicker noticing may be advisable because the owner is not liable for amounts already paid to the contractor prior to receiving the notice. The Sworn Statement should be provided whenever a payment is due or requested on a residential project.
A Michigan Notice of Furnishing must be sent to both the property owner (or the owner’s designee if there is one) and the general contractor to be valid.
A Michigan Notice of Furnishing must be in substantially the same form as provided under Mich Comp. Laws §570.1109(4) and include all of the following information:
• Claimant’s name & address
• Owner (owner designee) or lessee’s name
• Hiring party’s name & address
• Description of labor and/or materials
• Notice of Commencement recording information (liner & page #) or a copy of the notice
• Statutory notice language
A Michigan Notice of Furnishing may be served either personally or mailed by certified mail.
If the Michigan Notice of Furnishing is sent by certified mail, service is considered complete upon deposit in the mail. Otherwise, service is complete upon actual receipt of the notice.
If the Notice of Furnishing is not provided timely, all is not necessarily lost. The failure to give the notice within the proper time period is not fatal to a lien claim in Michigan but will reduce the amount of the lien to the unpaid balance owed from the owner to the general contractor upon receipt of the notice
Preliminary notice on public projects in Michigan is required from all claimants who didn’t contract directly with the prime contractor,( i.e. second-tier subs and suppliers and below) in order to retain the ability to make a claim against the payment bond in the event of nonpayment.
Michigan public project preliminary notices must be served no later than 30 days after the date of first furnishing labor and/or materials to the project.
Public project preliminary notices in Michigan must be sent to the prime contractor who posted the payment bond. And, although not required, notice can also be sent to the surety who is providing the bond for full visibility on the project.
A public preliminary notice in Michigan must include all of the following information:
• Claimant’s name & address
• Hiring party’s name & address
• Description of labor and/or materials
A Michigan public preliminary notice should be served by certified mail to any place the prime contractor maintains a business or residence. However, if the claimant can prove that the party actually received the notice sent by some other method, that notice will suffice.
Michigan courts have held that actual receipt is not necessary, therefore notice may be deemed served upon deposit in the mail by the proper means.
Failure to send preliminary notice on a public works project in Michigan within the 30-day timeframe is fatal to a claimant’s ability to make a claim against the payment bond.
First, filing a lien under the circumstances you present is problematic. There are strict deadlines for noticing intent and recording your lien. Sounds to me like this is an afterthought and not within 4 months of your last date of work, but perhaps I'm wrong there. In any event, if you're seeking items from two years ago, I doubt that would go well for you under a mechanic's lien theory of recovery.
Second, it doesn't sound like there was much of an arrangement between you and the owner, this was something you were doing to improve the residence you were living in.
Third, if you're broke, what good is the mechanic's lien anyway? Even if it were valid, you'd still need to take action on it to pursue it. If they've just refi'd, I imagine the property is encumbered to a not-insignificant extent. The loan already closed, so presumably they aren't going to refi again or sell very soon. If you don't have the money to pursue a wrongful eviction, foreclosure likely isn't within your current financial ability to pursue. If you aren't going to foreclose, then you still have other claims and remedies, but I'd think you'd handle most of those claims and damages within a wrongful eviction case, should you ever have the means to pursue that case.
Answered by Neil Sullenberger | PartnerMost likely your best course of action at this point would be a demand letter and potentially a breach of contract action against the GC who has not paid you. If there is a payment bond on the project your may still have time to make a claim against this bond. But otherwise, because you did not send preliminary notice, you would not have lien rights.
Answered by Peter Ryan | PartnerMichigan requires most project participants to provide a preliminary notice, but the notice and the deadline can change depending on the project type, and the role of the particular participant furnishing the notice. And, in fact, while not a “preliminary notice” in the usual sense, some notice requirements even extend to the property owner him/herself. Michigan is one of the few states that specifically requires the filing of a notice of commencement, and provides consequences for the failure to do so.
On most projects, parties who contract directly with the property owner are not required to deliver a preliminary notice, although if requested to do so a direct contractor must provide a list of subs and suppliers on the project. On residential projects, however, providing notice is specifically required of direct contractors. Prior to receiving any progress or final payment, the contractor must provide the property owner with a sworn statement listing all sub-tier parties with whom the contractor has contracted and the amounts unpaid to them, if any. This sworn statement notice is to allow the property owner to keep track of liabilities down the payment chain, to gain project visibility, and to serve as a check for the receipt of lien waivers from sub-tier parties. Likewise, the sworn statement is also required of subcontractors on residential projects, is delivered to the GC, and lists the sub-tier parties with whom the sub contracted, and amounts due (if any).
Additionally, those who do not have direct contact with the property owner (or the owner’s agent) are required to deliver a Notice of Furnishing within 20 days of the first furnishing of labor or materials on the project. This is a “traditional” preliminary notice requirement, and generally what people are referring to when Michigan preliminary notices, or the rules and requirements surrounding them, ae being discussed.
Michigan also has preliminary notice rules for parties performing work on public projects. Every 2nd-tier subcontractor or below, that is everybody who didn’t contract with either the public entity or the general contractor, must deliver a preliminary notice within 30 days of first furnishing labor or materials.
First, read the guide to preliminary notices in Michigan. The guide introduces you to the notice of furnishing form, including what you need to include, who you need to send it to, when it needs to be sent, and how it needs to be sent.
Next, download a copy of the Michigan preliminary notice. Michigan mechanics lien law is strict when it comes to the language and formatting for construction notices. Levelset’s free forms were written by construction attorneys to meet those requirements, making this part easy for you to get right.
The next step is to fill the form out. To ensure you secure your right to file a mechanics lien, be careful to include al the required information and make sure that information is 100% accurate. Failure to do this could forfeit your Michigan lien rights.
Lastly, it’s time to deliver the Michigan preliminary notice. You have two delivery options: either by personal service or certified mail, return receipt requested.
Send your notice to the owner or the owner’s designee within 20 days of first furnishing. Laborers have 30 days from when payment was due.
