Tag Archives: Missouri Mechanic’s Lien

10 Step Checklist for Material Suppliers Filing a Mechanic’s Lien in Missouri

Material Suppliers often face collection issues due to contractors running up accounts and running out of funds on large projects. This can happen for any number of reasons including the contractor’s failure to properly bid the job, issues with cash flow, or complaints regarding the quality or condition of the materials supplied.

Regardless of the reason, suppliers find themselves in collection situations quite frequently, and in many cases, the only manner in which the supplier can collect is by filing a mechanic’s lien on the owner’s property.  In an effort to provide general guidance relating to Missouri mechanic’s liens, we have prepared a checklist that suppliers can reference which utilizes and references or is based upon Missouri’s lien statutes and case law.

It is always advised to seek the counsel of an attorney licensed in the state of Missouri who is familiar and knowledgeable regarding the lien laws.  A mechanic’s lien filing can be a meticulous and difficult process. You should proceed with caution and strongly consider using this checklist as a general reference rather than utilizing it to prepare your own lien.

Step 1. Determine whether the work or material furnished is considered lienable under Missouri Mechanic’s Lien Laws

Ordinarily, common sense will dictate whether work performed or materials supplied are lienable.  However, to make a few examples, Missouri case law describes the following items as those which may give rise to the assertion of a lien: lumber, paneling, sheet rock, tape, paint, paint brushes, sandpaper, saw blades.

Many of the foregoing items would give rise to an invoice that would not likely necessitate a lien due to their modest cost.  However, if a material supplier provides any appreciable amount of product or supplies, which are later incorporated into the subject property, there is a high probability that the supplier has a lienable claim. R.S. Mo. § 429.010

Step 2. Determine the Date that Indebtedness Accrued and Ensure Timely Filing of Lien

The date indebtedness accrued is typically treated as the last day the claimant provided labor or materials to the property that is the subject of the lien. R.S. Mo. § 429.080. “It shall be the duty of every original contractor, every journeyman and day laborer, including persons who use rented machinery or equipment in performing such work or labor, and every other person seeking to obtain the benefit of the provisions of sections 429.010 to 429.340, within six months after the indebtedness shall have accrued.” R.S. Mo. § 429.080.

Step 3. Obtain Legal Information Pertaining to the Subject Real Estate

Typically a title report or letter report is obtained from a local title company. This report is necessary for the preparation of the lien (it is not always necessary for the preparation of the notice but can be helpful in compiling the necessary information). Some of the important reasons to obtain the title report is to ascertain the identity of the owner of record and the exact legal description of the subject property.

Step 4. Determine the Classification of the Entity/Individual with Whom You Have Contracted

Construction projects can have numerous different trades and contractors.  It is important to establish your classification as a supplier or subcontractor or whatever you may be. If the claimant is a subcontractor or supplier (or any person on the project other than the original contractor), the claimant, in order to properly preserve its lien rights, is required to prepare a notice of intent to file a mechanic’s lien statement and serve it on the owner. Said notices are to be served within six months from the date indebtedness accrued less ten days pursuant to R.S. Mo. § 429.100. This notice is sometimes referred to in the industry as a Notice of Intent to File a Mechanic’s Lien.

For Suppliers of Rental Equipment, the claimant must comply with a number of rigid requirements set forth in R.S.Mo § 429.010, and said claimant should refer to the rental equipment supplier lien filing article, which references other statutes because the checklist set forth herein is not adequate to satisfy the rental equipment supplier lien claimant’s requirements. However, in an effort to give a rough overview, the following relates to liens involving rental of machinery/equipment:

  There shall be no lien involving the rental of machinery or equipment unless:

  • (1) The improvements are made on commercial property;
  • (2) The amount of the claim exceeds five thousand dollars; and
  • (3) The party claiming the lien provides written notice within fifteen business days of the commencement of the use of the rental machinery or equipment to the property owner that rental machinery or equipment is being used upon their property. Such notice shall identify the name of the entity that rented the machinery or equipment and the machinery or equipment being rented.

Step 5. Ensure the 10 day Notice of Intent to File a Mechanic’s Lien Contains the Required Elements

Notice of Intent to File a Mechanic’s Lien should contain the following information:

  1. The name of the person or persons to whom notice must be given
  2. The name of the claimant
  3. A description of the improvement (e.g., performed electrical work in the entirety of the two-story brick building)
  4. The location of the property, preferably the legal description that will be used in the lien statement
  5. The name of the person or persons with whom the claimant made the contract
  6. The amount of the claim
  7. The basis of the claim (i.e., whether for labor, for materials, or for labor and materials)
  8. A statement that, unless the account is paid before a specified date (which should be a date at least ten days after the date of service of the notice but in no event later than the date the lien statement must be filed), a lien statement will be filed
  9. The date of the notice
  10. The signature of the claimant–see Towner v. Remick, 19 Mo. App. 205 (W.D. 1885), and Schulenburg v. Bascom, 38 Mo. 188 (1866) (requiring the claimant’s name and signature); Miller v. Hoffman, 26 Mo. App. 199, 202 (E.D. 1887) (upheld a notice signed “Miller & Fathman, by Julian Laughlin, their attorney”)
  11. The return of service

 Step 6. Check the records of the clerk of the circuit court for other Lienholders or Individuals/Entities with Equitable Interests in the Property

It is well-advised to determine whether any other claimants maintain a lien or other equitable interest against the subject property. From a practical standpoint, many times the letter report or title report will identify those interested parties.  However, it is important to conduct your own investigation as your claim progresses to ensure that each interested party becomes a party to your enforcement lawsuit. If so, the claimant should be joined in that suit in order to properly adjudicate each interested party’s rights with respect to the lien. § 429.270

Step 7. Prepare and Timely file a Mechanic’s Lien Statement with the Clerk of the Circuit Court in the County where the Property is Located

Lien Statement should contain (§429.080):

  1. “[A] just and true account of the demand due . . . after all just credits have been given”
  2. “[A] true description of the property, or so near as to identify the same, upon which the lien is intended to apply”
  3. “[T]he name of the owner or contractor, or both, if known to the person filing the lien”
  4. Verification by the claimant or some credible person for the claimant

Step 8. Bring a Lawsuit to Foreclose on the Mechanic’s Lien within Six Months of Filing the Statement of Lien

The claimant must file a petition in the circuit or associate circuit division to foreclose the mechanic’s lien within six months from the date the lien statement was filed by the claimant. §429.170.

Step 9. Ensure that process is served as soon as possible to avoid vitiation of the lien due to failure to prosecute. §429.170

 Step 10. Take judgment on the Foreclosure of the Mechanic’s Lien Claim

After presenting the evidence and allowing the court or jury to review the merits of the case, you will request that the judge or jury render a judgment/verdict in your favor to take judgment in the case.

Conclusion

The foregoing steps merely provide to suppliers to provide some structure in pursuing claims for unpaid materials. However, the list is not exhaustive and lien filing process may include additional steps that are not covered herein. While this article may be helpful in many respects, it should not be used as a substitute for retaining competent counsel to assist with the preparation of a lien filing, including the notice provisions, as often that poses the greatest difficulty for clients. If you need assistance with filing your mechanic’s lien, please do not hesitate to contact our firm, and we can discuss your options and how to best proceed.

St. Louis Mechanic’s Lien Law Attorney

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St. Louis Lien Attorneys

Depending on the size of your project, a mechanic’s lien can secure hundreds to millions of dollars.

Mechanic’s liens are a critical tool for a construction contractor seeking to collect payment on a construction project.

Why?

Because a lien has the ability to collateralize the property for you.

It makes the real property, upon which you’ve performed the work, collateral, in the event that you do not get paid on the project.

Thus, the real property will be your collateral up to the amount you are owed–that’s what filing a valid mechanic’s lien can do for you.

Essentially the lien clouds the title of the property and causes the lender/financial institution to put pressure on the owner of the property (if there’s a mortgage or deed of trust), or it limits marketability of the property because the encumbrance on the title detracts purchasers.

We are not saying that you cannot collect on a construction project without a lien.  Rather, we are merely pointing out the fact that it is the most powerful collection tool that a contractor can use when seeking payment on a construction project.

In light of the importance of a mechanic’s lien, you want to make sure that you preserve your lien rights and utilize those rights when necessary.

We have attorneys who are experienced with filing and defending mechanic’s liens as we have litigated numerous cases dealing with the foreclosure of mechanic’s liens–both defending and prosecuting the same.

If you need assistance in dealing with your mechanic’s lien filing or claim, our attorneys are experienced with handling the same, and we can help you!

Please contact one of our construction law attorneys today.