Source: https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/
Timestamp: 2020-08-11 21:37:46
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Washington Mechanics Liens: Everything You Need to Know + Free Forms
Home » Mechanics Liens – Overview, Guide & FAQ » Washington Mechanics Lien FAQs
Washington Mechanics Lien Guide and FAQs
If contractors and suppliers don’t get paid on a construction project in Washington, they can file a mechanics lien to secure payment. A mechanics lien is a legal tool that provides the unpaid party with a security interest in the property. This page breaks down the rules, requirements, and deadlines you need to follow to file a Washington mechanics lien.
Washington lien deadlines for:
Under some circumstances, Notice to Owner required before commencing work. Model Disclosure Statement due before work begins on all residential projects, and commercial projects under $60,000.
Washington Mechanics Lien must be filed w/in 90 days from last delivering labor or materials.
In Washington, an action to enforce a mechanics lien be initiated within 8 months from the lien’s filing.
This deadline may not be extended, and if this 8-month period passes without an action being filed to enforce the lien, the lien expires.
Notice of Right to Claim Lien within 60 days from first delivering labor or materials. Who must receive the notice depends on the role of the party that hired the party giving notice.
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Washington Mechanics Lien FAQs
Contractors, suppliers, property owners, construction lenders, and other vendors will encounter all kinds of lien-related paperwork and questions when working on Washington construction jobs. Here are some of the common issues you may encounter, and answers written by Washington construction attorneys and payment experts.
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-who-can-file-a-washington-mechanics-lien
Who can file a Washington Mechanics Lien?
The following parties are entitled to mechanics lien rights in Washington: direct contractors, subcontractors, material suppliers, equipment lessors, design professionals, and landscape gardners for the improvement of real property.
Suppliers to suppliers do not have lien rights. Construction managers don’t have any lien rights in Washington either.
Additionally, Washington requires builders to register and to obtain a certificate of registration. If you are a “builder” and fail to obtain a certificate of registration, you lose your right to claim and enforce a lien. Suppliers of materials who do not perform the work of incorporating those materials into the project are exempt from these registration requirements.
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-when-is-the-deadline-to-file-a-washington-mechanics-lien
When is the deadline to file a Washington Mechanics Lien?
In Washington, the deadline to file a mechanics lien is 90 days from the last date the claimant furnished labor or materials to the project. It’s impossible to change the mechanics lien deadline by contract or agreement – it is what it is.
Also, if the deadline falls on a weekend or a holiday in Washington state, the deadline is extended until the next business day.
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-where-can-i-get-a-washington-mechanics-lien-form
Where can I get a Washington Mechanics Lien form?
A free, downloadable Washington Claim of Lien can be found here.
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-must-the-washington-lien-include-a-legal-property-description
Must the Washington Lien include a legal property description?
No. A mechanics lien in Washington does not need to include a Legal Property Description to be valid. The lien requires a street address, legal description, or other description reasonably calculated to identify the location of the real property to be charged with the lien.
Even though Washington’s lien requirements can be technical, fighting over small and uncertain matters can be risky for litigants.
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-can-i-include-attorneys-fees-collection-costs-or-other-amounts-in-the-lien-total
No. However, if you foreclose on the lien, the court may award the prevailing party the money paid for recording the lien, attorney’s fees, and the necessary expenses incurred by the attorney, as costs.
See: Can I Include Lien Costs or Attorney Fees in a Washington Mechanics Lien?
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-must-the-washington-lien-be-notarized
Must the Washington Lien be notarized?
Yes. A mechanics lien in Washington must be notarized to be valid.
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-where-do-i-file-and-record-my-washington-mechanics-lien
Where do I file and record my Washington Mechanics Lien?
Washington mechanics lien claims are documents recorded with the county recorder office. For your mechanics lien to be valid, you must record it in the county where the job is physically located. Washington counties each have their own unique rules and requirements.
To help you, we’ve assembled all of the offices in Washington that record mechanics liens. These pages will walk you through the county’s specific formatting requirements, fees, processes to file, and answers to frequently asked questions.
Also, in Washington state, most counties are accepting electronically recorded documents, and electronically recorded liens specifically.
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-how-do-i-actually-file-a-washington-mechanics-lien
How do I actually file a Washington Mechanics Lien?
A Washington mechanics lien must be in the proper format and filed in the county recorder’s office of the county where the property is located within the required timeframe.
For this, you may want to consult our Step-by-Step Guide on How to File a Washington Mechanics Lien.
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-do-i-need-to-send-notice-the-lien-was-recorded
Yes. A copy of the Washington Claim of Lien must be served on the property owner within 14 days of the date of filing. This can be done by certified or registered mail, or by personal service.
If you don’t deliver notice to the owner, the lien isn’t invalid, but you can’t recover attorney fees or costs if you foreclose on the lien.
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-when-is-the-deadline-to-enforce-a-washington-mechanics-lien-or-how-long-is-my-lien-effective
When is the deadline to enforce a Washington Mechanics Lien, or, how long is my Lien effective?
In Washington, a mechanics lien is effective for 8 months after its filing, and an action to enforce must be initiated within that period of time. If this 8-month period passes without an action being filed to enforce the lien, the lien expires.
Foreclosing on the mechanics lien has a its own service requirement s.
See: Foreclosing A Mechanics Lien in Washington Just Got More Confusing.
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-who-cancels-the-washington-lien-if-when-i-get-paid
Who cancels the Washington Lien if/when I get paid?
Washington law requires that a lien claimant release their lien rights upon payment and acceptance of the amount due to them and upon demand of the owner or the person making payment. The lien claimant is required to immediately prepare and execute a release of lien rights, and deliver the release to the person making the payment.
If the owner has to file suit to compel the release, the claimant may be liable for damages, court costs, and attorney’s fees
See: How To Cancel A Washington Mechanics Lien.
https://www.levelset.com/mechanics-lien/washington-lien-law-faqs/#faq-item-will-my-washington-lien-have-priority-over-preexisting-mortgages-or-construction-loans
Will my Washington Lien have priority over pre-existing mortgages or construction loans?
No. A Washington mechanics lien has priority only over a lien or other encumbrance which attached to the land afterwards, or was unrecorded at the time, labor, services, or materials were first provided by you.
People are asking Washington construction attorneys:
https://www.levelset.com/payment-help/question/can-i-add-a-2-compounded-weekly-fee-to-my-invoice-if-payment-is-not-being-made-how-do-i-keep-updating-that-in-my-lien/
Can I add a 2% compounded weekly fee to my invoice if payment is not being made? How do I keep updating that in my lien
If interest wasn't listed in the contract or on the invoice, you can't charge 2% but you can charge 12% per annum or 1% and you don't need to update the lien. When and if it goes to foreclosure, you can list the interest in the prayer for relief.
Answered by Sarah Stasch | Attorney
https://www.levelset.com/payment-help/question/lien-still-on-my-property-after-i-have-paid-the-amounts-in-full-and-have-requested-the-contractor-to-remove-the-lien/
Lien still on my property after I have paid the amounts in full and have requested the Contractor to remove the Lien
Under Wash. Rev. Code §60.04.071, once a the lien claimant has been paid the amount due under the Washington mechanics lien, they are required to immediately file a lien release in the county auditor's office where the initial claim was filed. If the claimant fails to release the claim, the property owner may file an action in court to compel the release of the claim. Also, if the court determines that the delay was unjustified (which it appears to be) then the court may also award attorney fees, court costs, and any damages caused by the failure to release the claim. You should contact a Washington construction attorney to help you with the filing process.
See Satisfaction or Bust: Lien Release Deadlines & Penalties in All 50 States
https://www.levelset.com/payment-help/question/what-happens-after-my-lien-is-filed/
What happens after my lien is filed?
Once a Washington mechanics lien has been filed, it will be valid for a period of 8 months after the claim has been recorded. If unpaid within this time frame, and action to enforce the claim will need to be filed before the claim expires and is no longer enforceable. This is a full lawsuit, so you should contact a local attorney before deciding to foreclose. Here's a list of a few Washington construction attorneys from our Expert Center Community that you may want to reach out to personally. One optional step to take before filing a lawsuit is to send a Notice of Intent to Foreclose. This is an informal letter stating that if you aren't paid within x amount of days you are willing to file a lawsuit to enforce your rights. This letter is usually quite effective at inducing payment. Good luck! Here are some other resource you may find helpful:
4 Steps to Take After Filing a Mechanics Lien
How to File a Washington Mechanics Lien | Step-by-Step Guide to Get Paid
Foreclosing a Washington Mechanics Lien Just Got More Confusing
View more Mechanics Lien Washington questions
View Washington questions
Ask a construction lawyer about a Washington Mechanics Lien
Washington Court: Contractor Can File Claim After Lien Release
Bonding Around A Lien: What it Means for Contractors in Washington
Authored by Seth Millstein
Review of New Washington Lien Law Treatise
Washington Mechanics Liens: Rights & Unjust Enrichment Claims In Recent Case
Construction Managers in Washington Cannot File Mechanics Liens
Washington Lien Laws: Strict or Liberal?
Watch Supreme Court Oral Argument in Controversial Washington Mechanic’s Lien Case
Bill Dies That Would Offset Controversial Williams v. Athletic Field Decision
Best rated general contractors in Washington
Attollo Development
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Washington’s mechanics lien laws provide substantial protection for contractors and suppliers. However, there are many requirements that must be followed in order for a construction participant to qualify for, maintain, perfect, and enforce lien rights. This page provides frequently asked questions about Washington’s mechanics lien laws and rules, the lien statutes, and a breakdown of the lien and notice details for contractors and suppliers in Washington.
You may want to consult our Step-by-Step Guide on How to File a Washington Mechanics Lien
Do It Yourself: How to file a lien in Washington
Not everyone is entitled to file a mechanic’s lien in Washington. The services, materials or labor you furnish to a construction project must qualify for protection under Washington’s lien laws. The trick is determining whether your construction project is a qualifying improvement, which is defined by RCW 60.04.11(5). Read the guide to find out.
Washington has strict requirements about the language and information your mechanic’s lien must contain. The statute itself proscribes a form to use to file a Washington mechanic’s lien. Read the statutes carefully before filling out this form or any other Washington payment forms.
This part can get tricky since Washington mechanics lien law is strict about the information and format that is required. Making a mistake on the lien form could invalidate your claim. All of the information must be accurate, including the legal names of each party, the property description, the property owner(s), and the claim amount. Review every detail carefully. Don’t forget it needs to be notarized too!
File your lien with the county recorder
There are a few different ways to file a lien in Washington: In person at the correct county recorders office, by mail, or via electronic filing. e-filing is usually easiest but can have extra fees associated.
Serve a copy of the lien
Washington requires all mechanic’s lien claimants to serve a copy of the mechanic’s lien on the property owner within 14 days of recording. Failure to serve the lien might not invalidate it, but it will disqualify you from recovering your attorney fees in any action to enforce the lien.
Learn more [video]
Filing a lien, in and of itself, doesn’t always solve the issue, and a lien filing isn’t the end of the road. There are some other important steps to consider here. In addition to serving the lien, you should be communicating with other parties, potentially inforcing the lien, or releasing the lien if payment was made.
The provisions of the Washington statutes that permit the filing of mechanics liens and materialman’s liens on construction projects can be found in Washington’s Mechanics’ and Materialmen’s Lien Law, RCWA § 60.04.011 et. seq. Relevant sections of Washington’s mechanics lien statute have been provided below.
Prerequisite to Lien Claim
§18.27.114 Disclosure Statement Required - Prerequisite to Lien Claim
(1) Any contractor agreeing to perform any contracting project:
(a) For the repair, alteration, or construction of four or fewer residential units or accessory structures on such residential property when the bid or contract price totals one thousand dollars or more; or
(b) for the repair, alteration, or construction of a commercial building when the bid or contract price totals one thousand dollars or more but less than sixty thousand dollars, must provide the customer with the following disclosure statement in substantially the following form using lower case and upper case twelve-point and bold type where appropriate, prior to starting work on the project:
“NOTICE TO CUSTOMER
This contractor is registered with the state of Washington, registration no. . . ., and has posted with the state a bond or deposit of . . . . . for the purpose of satisfying claims against the contractor for breach of contract including negligent or improper work in the conduct of the contractor’s business. The expiration date of this contractor’s registration is . . . . . .
THIS BOND OR DEPOSIT MIGHT NOT BE SUFFICIENT TO COVER A CLAIM THAT MIGHT ARISE FROM THE WORK DONE UNDER YOUR CONTRACT.
This bond or deposit is not for your exclusive use because it covers all work performed by this contractor. The bond or deposit is intended to pay valid claims up to . . . . . that you and other customers, suppliers, subcontractors, or taxing authorities may have.
FOR GREATER PROTECTION YOU MAY WITHHOLD A PERCENTAGE OF YOUR CONTRACT.
You may withhold a contractually defined percentage of your construction contract as retainage for a stated period of time to provide protection to you and help insure that your project will be completed as required by your contract.
YOUR PROPERTY MAY BE LIENED.
If a supplier of materials used in your construction project or an employee or subcontractor of your contractor or subcontractors is not paid, your property may be liened to force payment and you could pay twice for the same work.
FOR ADDITIONAL PROTECTION, YOU MAY REQUEST THE CONTRACTOR TO PROVIDE YOU WITH ORIGINAL “LIEN RELEASE” DOCUMENTS FROM EACH SUPPLIER OR SUBCONTRACTOR ON YOUR PROJECT.
The contractor is required to provide you with further information about lien release documents if you request it. General information is also available from the state Department of Labor and Industries.
I have received a copy of this disclosure statement.
(Signature of customer)”
(2) The contractor must retain a signed copy of the disclosure statement in his or her files for a minimum of three years, and produce a signed or electronic signature copy of the disclosure statement to the department upon request.
(3) A contractor subject to this section shall notify any consumer to whom notice is required under subsection (1) of this section if the contractor’s registration has expired or is revoked or suspended by the department prior to completion or other termination of the contract with the consumer.
(4) No contractor subject to this section may bring or maintain any lien claim under chapter 60.04 RCW based on any contract to which this section applies without alleging and proving that the contractor has provided the customer with a copy of the disclosure statement as required in subsection (1) of this section.
(5) This section does not apply to contracts authorized under chapter 39.04 RCW or to contractors contracting with other contractors.
(6) Failure to comply with this section shall constitute an infraction under the provisions of this chapter.
(7) The department shall produce model disclosure statements, and public service announcements detailing the information needed to assist contractors and contractors’ customers to comply under this section. As necessary, the department shall periodically update these education materials.
Voluntary compliance with notification requirements: “Nothing in RCW 18.27.114 shall be construed to prohibit a contractor from voluntarily complying with the notification requirements of that section which take effect July 1, 1989, prior to that date.” [ 1988 c 182 § 2.]
Part 1: Mechanics' and Materialman's Liens
§ 60.04.011. Definitions
(1) “Construction agent” means any registered or licensed contractor, registered or licensed subcontractor, architect, engineer, or other person having charge of any improvement to real property, who shall be deemed the agent of the owner for the limited purpose of establishing the lien created by this chapter.
(2) “Contract price” means the amount agreed upon by the contracting parties, or if no amount is agreed upon, then the customary and reasonable charge therefor.
(3) “Draws” means periodic disbursements of interim or construction financing by a lender.
(4) “Furnishing labor, professional services, materials, or equipment” means the performance of any labor or professional services, the contribution owed to any employee benefit plan on account of any labor, the provision of any supplies or materials, and the renting, leasing, or otherwise supplying of equipment for the improvement of real property.
(6) “Interim or construction financing” means that portion of money secured by a mortgage, deed of trust, or other encumbrance to finance improvement of, or to real property, but does not include:
(7) “Labor” means exertion of the powers of body or mind performed at the site for compensation. “Labor” includes amounts due and owed to any employee benefit plan on account of such labor performed.
(8) “Mortgagee” means a person who has a valid mortgage of record or deed of trust of record securing a loan.
(9) “Owner-occupied” means a single-family residence occupied by the owner as his or her principal residence.
(10) “Payment bond” means a surety bond issued by a surety licensed to issue surety bonds in the state of Washington that confers upon potential claimants the rights of third party beneficiaries.
(11) “Potential lien claimant” means any person or entity entitled to assert lien rights under this chapter who has otherwise complied with the provisions of this chapter and is registered or licensed if required to be licensed or registered by the provisions of the laws of the state of Washington.
(12) “Prime contractor” includes all contractors, general contractors, and specialty contractors, as defined by chapter 18.27 or 19.28 RCW, or who are otherwise required to be registered or licensed by law, who contract directly with a property owner or their common law agent to assume primary responsibility for the creation of an improvement to real property, and includes property owners or their common law agents who are contractors, general contractors, or specialty contractors as defined in chapter 18.27 or 19.28 RCW, or who are otherwise required to be registered or licensed by law, who offer to sell their property without occupying or using the structures, projects, developments, or improvements for more than one year.
(14) “Real property lender” means a bank, savings bank, savings and loan association, credit union, mortgage company, or other corporation, association, partnership, trust, or individual that makes loans secured by real property located in the state of Washington.
(15) “Site” means the real property which is or is to be improved.
(16) “Subcontractor” means a general contractor or specialty contractor as defined by chapter 18.27 or 19.28 RCW, or who is otherwise required to be registered or licensed by law, who contracts for the improvement of real property with someone other than the owner of the property or their common law agent.
§ 60.04.021. Lien Authorized
§ 60.04.031. Notices - Exceptions
(b) Delivering or serving the notice personally upon the owner or reputed owner and obtaining evidence of delivery in the form of a receipt or other acknowledgement signed by the owner or reputed owner or an affidavit of service.
(a) Persons who contract directly with the owner or the owner’s common law agent;
(b) Who do not contract directly with the owner-occupier or their common law agent shall give notice of the right to claim a lien to the owner-occupier. Liens of persons furnishing professional services, materials, or equipment who do not contract directly with the owner-occupier or their common law agent may only be satisfied from amounts not yet paid to the prime contractor by the owner at the time the notice described in this section is received, regardless of whether amounts not yet paid to the prime contractor are due. For the purposes of this subsection “received” means actual receipt of notice by personal service, or registered or certified mail, or three days after mailing by registered or certified mail, excluding Saturdays, Sundays, or legal holidays.
Re: ……………….. (description of property: Street address or general location.)
AT THE REQUEST OF: ……………….. (Name of person ordering the professional services, materials, or equipment)
OWNER/OCCUPIER OF EXISTING RESIDENTIAL PROPERTY
COMMERCIAL AND/OR NEW RESIDENTIAL PROPERTY
Brief description of professional services, materials, or equipment provided or to be provided:
IMPORTANT INFORMATION ON REVERSE SIDE
(5) Every potential lien claimant providing professional services where no improvement as defined in RCW 60.04.011(5) (a) or (b) has been commenced, and the professional services provided are not visible from an inspection of the real property may record in the real property records of the county where the property is located a notice which shall contain the professional service provider’s name, address, telephone number, legal description of the property, the owner or reputed owner’s name, and the general nature of the professional services provided. If such notice is not recorded, the lien claimed shall be subordinate to the interest of any subsequent mortgagee and invalid as to the interest of any subsequent purchaser if the mortgagee or purchaser acts in good faith and for a valuable consideration acquires an interest in the property prior to the commencement of an improvement as defined in RCW 60.04.011(5) (a) or (b) without notice of the professional services being provided. The notice described in this subsection shall be substantially in the following form:
NOTICE OF FURNISHING PROFESSIONAL SERVICES
[Legal Description is mandatory]
The general nature of the professional services provided is
The owner or reputed owner of the real property is
§ 60.04.035. Acts of Coercion - Application of Chapter 19.86 RCW
§ 60.04.041. Contractor Registration
§ 60.04.051. Property Subject to Lien
§ 60.04.061. Priority of Lien
§ 60.04.071. Release of Lien Rights
Upon payment and acceptance of the amount due to the lien claimant and upon demand of the owner or the person making payment, the lien claimant shall immediately prepare and execute a release of all lien rights for which payment has been made, and deliver the release to the person making payment. In any suit to compel deliverance of the release thereafter in which the court determines the delay was unjustified, the court shall, in addition to ordering the deliverance of the release, award the costs of the action including reasonable attorneys’ fees and any damages.
§ 60.04.081. Frivolous Claim - Procedure
(2) The order shall clearly state that if the lien claimant fails to appear at the time and place noted the lien shall be released, with prejudice, and that the lien claimant shall be ordered to pay the costs requested by the applicant including reasonable attorneys’ fees.
(4) If, following a hearing on the matter, the court determines that the lien is frivolous and made without reasonable cause, or clearly excessive, the court shall issue an order releasing the lien if frivolous and made without reasonable cause, or reducing the lien if clearly excessive, and awarding costs and reasonable attorneys’ fees to the applicant to be paid by the lien claimant. If the court determines that the lien is not frivolous and was made with reasonable cause, and is not clearly excessive, the court shall issue an order so stating and awarding costs and reasonable attorneys’ fees to the lien claimant to be paid by the applicant.
§ 60.04.091. Recording - Time - Contents of Lien
……, claimant, vs ……, name of person indebted to claimant:
1. NAME OF LIEN CLAIMANT:
2. DATE ON WHICH THE CLAIMANT BEGAN TO PERFORM LABOR, PROVIDE PROFESSIONAL SERVICES, SUPPLY MATERIAL OR EQUIPMENT OR THE DATE ON WHICH EMPLOYEE BENEFIT CONTRIBUTIONS BECAME DUE:
4. DESCRIPTION OF THE PROPERTY AGAINST WHICH A LIEN IS CLAIMED (Street address, legal description or other information that will reasonably describe the property):
5. NAME OF THE OWNER OR REPUTED OWNER (If not known state “unknown”):
6. THE LAST DATE ON WHICH LABOR WAS PERFORMED; PROFESSIONAL SERVICES WERE FURNISHED; CONTRIBUTIONS TO AN EMPLOYEE BENEFIT PLAN WERE DUE; OR MATERIAL, OR EQUIPMENT WAS FURNISHED:
7. PRINCIPAL AMOUNT FOR WHICH THE LIEN IS CLAIMED IS:
8. IF THE CLAIMANT IS THE ASSIGNEE OF THIS CLAIM SO STATE HERE:
……………………………., Claimant
(Phone number, address, city, and state of claimant)
……………….., ss.
……………….., being sworn, says: I am the claimant (or attorney of the claimant, or administrator, representative, or agent of the trustees of an employee benefit plan) above named; I have read or heard the foregoing claim, read and know the contents thereof, and believe the same to be true and correct and that the claim of lien is not frivolous and is made with reasonable cause, and is not clearly excessive under penalty of perjury.
Subscribed and sworn to before me this … day of ……….
The period provided for recording the claim of lien is a period of limitation and no action to foreclose a lien shall be maintained unless the claim of lien is filed for recording within the ninety-day period stated. The lien claimant shall give a copy of the claim of lien to the owner or reputed owner by mailing it by certified or registered mail or by personal service within fourteen days of the time the claim of lien is filed for recording. Failure to do so results in a forfeiture of any right the claimant may have to attorneys’ fees and costs against the owner under RCW 60.04.181.
§ 60.04.101. Separate Residential Units - Time for Filing
§ 60.04.111. Recording - Fees
§ 60.04.121. Lien - Assignment
§ 60.04.131. Claims - Designation of Amount Due
§ 60.04.141. Lien - Duration - Procedural Limitations
§ 60.04.151. Rights of Owner - Recovery Options
The lien claimant shall be entitled to recover upon the claim recorded the contract price after deducting all claims of other lien claimants to whom the claimant is liable, for furnishing labor, professional services, materials, or equipment; and in all cases where a claim of lien shall be recorded under this chapter for labor, professional services, materials, or equipment supplied to any lien claimant, he or she shall defend any action brought thereupon at his or her own expense. During the pendency of the action, the owner may withhold from the prime contractor the amount of money for which a claim is recorded by any subcontractor, supplier, or laborer. In case of judgment against the owner or the owner’s property, upon the lien, the owner shall be entitled to deduct from sums due to the prime contractor the principal amount of the judgment from any amount due or to become due from the owner to the prime contractor plus such costs, including interest and attorneys’ fees, as the court deems just and equitable, and the owner shall be entitled to recover back from the prime contractor the amount for which a lien or liens are established in excess of any sum that may remain due from the owner to the prime contractor.
§ 60.04.161. Bond in Lieu of Claim
Any owner of real property subject to a recorded claim of lien under this chapter, or contractor, subcontractor, lender, or lien claimant who disputes the correctness or validity of the claim of lien may record, either before or after the commencement of an action to enforce the lien, in the office of the county recorder or auditor in the county where the claim of lien was recorded, a bond issued by a surety company authorized to issue surety bonds in the state. The surety shall be listed in the latest federal department of the treasury list of surety companies acceptable on federal bonds, published in the Federal Register, as authorized to issue bonds on United States government projects with an underwriting limitation, including applicable reinsurance, equal to or greater than the amount of the bond to be recorded. The bond shall contain a description of the claim of lien and real property involved, and be in an amount equal to the greater of five thousand dollars or two times the amount of the lien claimed if it is ten thousand dollars or less, and in an amount equal to or greater than one and one-half times the amount of the lien if it is in excess of ten thousand dollars. If the claim of lien affects more than one parcel of real property and is segregated to each parcel, the bond may be segregated the same as in the claim of lien. A separate bond shall be required for each claim of lien made by separate claimants. However, a single bond may be used to guarantee payment of amounts claimed by more than one claim of lien by a single claimant so long as the amount of the bond meets the requirements of this section as applied to the aggregate sum of all claims by such claimant. The condition of the bond shall be to guarantee payment of any judgment upon the lien in favor of the lien claimant entered in any action to recover the amount claimed in a claim of lien, or on the claim asserted in the claim of lien. The effect of recording a bond shall be to release the real property described in the notice of claim of lien from the lien and any action brought to recover the amount claimed. Unless otherwise prohibited by law, if no action is commenced to recover on a lien within the time specified in RCW 60.04.141, the surety shall be discharged from liability under the bond. If an action is timely commenced, then on payment of any judgment entered in the action or on payment of the full amount of the bond to the holder of the judgment, whichever is less, the surety shall be discharged from liability under the bond. Nothing in this section shall in any way prohibit or limit the use of other methods, devised by the affected parties to secure the obligation underlying a claim of lien and to obtain a release of real property from a claim of lien.
§ 60.04.171. Foreclosure - Parties
§ 60.04.181. Rank of Lien - Application of Proceeds - Attorneys' Fees
(3) The court may allow the prevailing party in the action, whether plaintiff or defendant, as part of the costs of the action, the moneys paid for recording the claim of lien, costs of title report, bond costs, and attorneys’ fees and necessary expenses incurred by the attorney in the superior court, court of appeals, supreme court, or arbitration, as the court or arbitrator deems reasonable. Such costs shall have the priority of the class of lien to which they are related, as established by subsection (1) of this section.
§ 60.04.190. Destruction or Concealment of Property - Removal from Premises - Penalty
§ 60.04.191. Effect of Note - Personal Action Preserved
§ 60.04.201. Material Exempt from Process - Exception
§ 60.04.211. Lien - Effect on Community Interest
§ 60.04.221. Notice to Lender - Withholding of Funds
NOTICE TO REAL PROPERTY LENDER (Authorized by RCW ………………..)
(Name of Laborer, Professional, Materials, or Equipment Supplier) whose business address is ……………, did at the property located at ……………
( ) perform labor
( ) furnish professional services
( ) provide materials
( ) supply
which was ordered by
whose address was stated to be:
The amount owing to the undersigned according to contract or purchase order for labor, supplies, or equipment (as above mentioned) is the sum of …………… Dollars ($……….). Said sums became due and owing as of
You are hereby required to withhold from any future draws on existing construction financing which has been made on the subject property (to the extent there remain undisbursed funds) the sum of …………… Dollars ($……….).
(5) After the receipt of the notice, the lender shall withhold from the next and subsequent draws the amount claimed to be due as stated in the notice. Alternatively, the lender may obtain from the prime contractor or borrower a payment bond for the benefit of the potential lien claimant in an amount sufficient to cover the amount stated in the potential lien claimant’s notice. The lender shall be obligated to withhold amounts only to the extent that sufficient interim or construction financing funds remain undisbursed as of the date the lender receives the notice.
(7) In the event a lender fails to abide by the provisions of *subsections (4) and (5) of this section, then the mortgage, deed of trust, or other encumbrance securing the lender shall be subordinated to the lien of the potential lien claimant to the extent of the interim or construction financing wrongfully disbursed, but in no event more than the amount stated in the notice plus costs as fixed by the court, including reasonable attorneys’ fees.
(8) Any potential lien claimant shall be liable for any loss, cost, or expense, including reasonable attorneys’ fees and statutory costs, to a party injured thereby arising out of any unjust, excessive, or premature notice filed under purported authority of this section. “Notice” as used in this subsection does not include notice given by a potential lien claimant of the right to claim liens under this chapter where no actual claim is made.
(b) The order shall clearly state that if the potential lien claimant fails to appear at the time and place noted, the notice to lender shall be declared void and that the potential lien claimant issuing the notice shall be ordered to pay the costs requested by the applicant including reasonable attorneys’ fees.
(d) If, following a hearing on the matter, the court determines that the claim upon which the notice to real property lender is based is frivolous and made without reasonable cause, or clearly excessive, the court shall issue an order declaring the notice to real property lender void if frivolous and made without reasonable cause, or reducing the amount stated in the notice if clearly excessive, and awarding costs and reasonable attorneys’ fees to the applicant to be paid by the person who issued the notice. If the court determines that the claim underlying the notice to real property lender is not frivolous and was made with reasonable cause, and is not clearly excessive, the court shall issue an order so stating and awarding costs and reasonable attorneys’ fees to the issuer of the notice to be paid by the applicant.
§ 60.04.226. Financial Encumbrances - Priorities
§ 60.04.230. Construction Projects - Notice to Be Posted by Prime Contractor - Penalty
(b) The property owner’s name, address, and phone number;
(c) The prime contractor’s business name, address, phone number, current state contractor registration number and identification; and
§ 60.04.250. Informational Materials on Construction Lien Laws - Master Documents
§ 60.04.255. Informational Materials on Construction Lien Laws - Copies - Liability
(4) For the purpose of this section, “real property lender” means a bank, savings bank, savings and loan association, credit union, mortgage company, or other corporation, association, partnership, or individual that makes loans secured by real property in this state.
§ 60.04.261. Availability of Information
§ 60.04.900. Liberal Construction - 1991 c 281
§ 60.04.901. Captions not Law - 1991 c 281
§ 60.04.902. Effective Date, Application - 1991 c 281
§ 60.04.903. Effective Date - 1992 c 126
§ 60.04.904. Application of Chapter 281, Laws of 1991, to Actions Pending as of June 1, 1992-1993 c 357
Part 2: Lien for Labor, Materials, Taxes on Public Works
§ 60.28.011. Retained Percentage - Labor and Material Created - Bond in Lieu of Retained Funds - Termination Before Completion - Chapter Deemed Exclusive - Release of Ferry Contract Payments - Projects of Farmers Home Administration - General Contractor/Construction Manager Procedure - Definitions
(a) After completion of all contract work other than landscaping, the contractor may request that the public body release and pay in full the amounts retained during the performance of the contract, and sixty days thereafter the public body must release and pay in full the amounts retained (other than continuing retention of five percent of the moneys earned for landscaping) subject to the provisions of chapters 39.12 and 60.28 RCW.
(6) A contractor may submit a bond for all or any portion of the contract retainage in a form acceptable to the public body and from an authorized surety insurer. The public body may require that the authorized surety have a minimum A.M. Best financial strength rating so long as that minimum rating does not exceed A-. The public body must comply with the provisions of RCW 48.28.010. This bond and any proceeds therefrom are subject to all claims and liens and in the same manner and priority as set forth for retained percentages in this chapter. The public body must release the bonded portion of the retained funds to the contractor within thirty days of accepting the bond from the contractor. Whenever a public body accepts a bond in lieu of retained funds from a contractor, the contractor must accept like bonds from any subcontractors or suppliers from which the contractor has retained funds. The contractor must then release the funds retained from the subcontractor or supplier to the subcontractor or supplier within thirty days of accepting the bond from the subcontractor or supplier.
§ 60.28.015. Recovery from Retained Percentage - Written Notice to Contractor of Materials Furnished
Every person, firm, or corporation furnishing materials, supplies, or equipment to be used in the construction, performance, carrying on, prosecution, or doing of any work for the state, or any county, city, town, district, municipality, or other public body, shall give to the contractor of the work a notice in writing, which notice shall cover the material, supplies, or equipment furnished or leased during the sixty days preceding the giving of such notice as well as all subsequent materials, supplies, or equipment furnished or leased, stating in substance and effect that such person, firm, or corporation is and/or has furnished materials and supplies, or equipment for use thereon, with the name of the subcontractor ordering the same, and that a lien against the retained percentage may be claimed for all materials and supplies, or equipment furnished by such person, firm, or corporation for use thereon, which notice shall be given by (1) mailing the same by registered or certified mail in an envelope addressed to the contractor, or (2) by serving the same personally upon the contractor or the contractor’s representative and obtaining evidence of such service in the form of a receipt or other acknowledgement signed by the contractor or the contractor’s representative, and no suit or action shall be maintained in any court against the retained percentage to recover for such material, supplies, or equipment or any part thereof unless the provisions of this section have been complied with.
§ 60.28.021. Excess Over Lien Claims Paid to Contractor
After the expiration of the forty-five day period for giving notice of lien provided in RCW 60.28.011(2), and after receipt of the certificates of the department of revenue, the employment security department, and the department of labor and industries, and the public body is satisfied that the taxes certified as due or to become due by the department of revenue, the employment security department, and the department of labor and industries are discharged, and the claims of material suppliers and laborers who have filed their claims, together with a sum sufficient to defray the cost of foreclosing the liens of such claims, and to pay attorneys’ fees, have been paid, the public body may withhold from the remaining retained amounts for claims the public body may have against the contractor and shall pay the balance, if any, to the contractor the fund retained by it or release to the contractor the securities and bonds held in escrow.
§ 60.28.030. Foreclosure of Lien - Limitation of Action - Release of Funds
§ 60.28.040. Tax Liens - Priority of Liens
(1) Subject to subsection (5) of this section, the amount of all taxes, increases, and penalties due or to become due under Title 82 RCW, from a contractor or the contractor’s successors or assignees with respect to a public improvement contract wherein the contract price is thirty-five thousand dollars or more, is a lien prior to all other liens upon the amount of the retained percentage withheld by the disbursing officer under such contract.
(2) Subject to subsection (5) of this section, after payment of all taxes, increases, and penalties due or to become due under Title 82 RCW, from a contractor or the contractor’s successors or assignees with respect to a public improvement contract wherein the contract price is thirty-five thousand dollars or more, the amount of all other taxes, increases, and penalties under Title 82 RCW, due and owing from the contractor, is a lien prior to all other liens upon the amount of the retained percentage withheld by the disbursing officer under such contract.
(3) Subject to subsection (5) of this section, after payment of all taxes, increases, and penalties due or to become due under Title 82 RCW, the amount of all taxes, increases, and penalties due or to become due under Titles 50 and 51 RCW from the contractor or the contractor’s successors or assignees with respect to a public improvement contract wherein the contract price is thirty-five thousand dollars or more is a lien prior to all other liens upon the amount of the retained percentage withheld by the disbursing officer under such contract.
(5) The employees of a contractor or the contractor’s successors or assignees who have not been paid the prevailing wage under such a public improvement contract shall have a first priority lien against the bond or retainage prior to all other liens.
§ 60.28.051. Duties of Disbursing Officer Upon Completion of Contract
Upon completion of a contract, the state, county, or other municipal officer charged with the duty of disbursing or authorizing disbursement or payment of such contracts shall forthwith notify the department of revenue, the employment security department, and the department of labor and industries of the completion of contracts over thirty-five thousand dollars. Such officer shall not make any payment from the retained percentage fund or release any retained percentage escrow account to any person, until he or she has received from the department of revenue, the employment security department, and the department of labor and industries certificates that all taxes, increases, and penalties due from the contractor, and all taxes due and to become due with respect to such contract have been paid in full or that they are, in each department’s opinion, readily collectible without recourse to the state’s lien on the retained percentage.
§ 60.28.060. Duties of Disbursing Officer Upon Final Acceptance of Contract - Request of Payment of Taxes, Increases, Penalties, and Claims
If within thirty days after receipt of notice by the department of revenue, the employment security department, and the department of labor and industries of the completion of the contract, the amount of all taxes, increases and penalties due from the contractor or any of his or her successors or assignees or to become due with respect to such contract have not been paid, the department of revenue, the employment security department, and the department of labor and industries may certify to the disbursing officer the amount of all taxes, increases and penalties due from the contractor, together with the amount of all taxes due and to become due with respect to the contract and may request payment thereof in accordance with the priority provided by this chapter. The disbursing officer shall within ten days after receipt of such certificate and request pay to the department of revenue, the employment security department, and the department of labor and industries the amount of all taxes, increases and penalties certified to be due or to become due and all claims which by statute are a lien upon the retained percentage withheld by the disbursing officer in accordance with the priority provided by this chapter. If the contractor owes no taxes imposed pursuant to Titles 50, 51, and 82 RCW, the department of revenue, the employment security department, and the department of labor and industries shall so certify to the disbursing officer.
§ 60.28.080. Delay Due to Litigation - Change Order or Force Account Directive - Costs - Arbitration - Termination
(1) If any delay in issuance of notice to proceed or in construction following an award of any public construction contract is primarily caused by acts or omissions of persons or agencies other than the contractor and a preliminary, special or permanent restraining order of a court of competent jurisdiction is issued pursuant to litigation and the appropriate public contracting body does not elect to delete the completion of the contract as provided by RCW 60.28.011(7), the appropriate contracting body will issue a change order or force account directive to cover reasonable costs incurred by the contractor as a result of such delay. These costs shall include but not be limited to contractor’s costs for wages, labor costs other than wages, wage taxes, materials, equipment rentals, insurance, bonds, professional fees, and subcontracts, attributable to such delay plus a reasonable sum for overhead and profit.
§ 60.28.900. Severability - 1955 c 236
If any section, provision or part of this chapter shall be adjudged to be invalid or unconstitutional, such adjudication shall not affect the validity of this chapter as a whole or any section, provision or part hereof not adjudged invalid or unconstitutional.
Washington construction payment topics