Source: https://www.levelset.com/blog/virginia-mechanics-lien-forms/
Timestamp: 2019-07-23 11:10:20
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Virginia Mechanics Lien Forms Updated by Legislature | Legal Alert
Published on Jul 09, 2019 | Reading Time: 3 minutes
Legal Alert, Virginia
Virginia recently updated its lien laws by adding about a sentence to its statutory mechanics lien forms, and by adding a few more words elsewhere. They’re minor alterations, but they’ll impact claimants who use the statutory forms. Let’s take a look.
Virginia mechanics lien forms updated by legislature
Practically, what’s the difference?
Change to §43-4
Changes to §43-5, §43-8, and §43-10
A note about the Virginia mechanics lien forms provided by statute
Virginia mechanics lien forms and the benefit of the doubt
You can see the changes yourself, here: H 2409. For a little more analysis, Construction Law Musings has a great resource.
§43-4 of the Code of Virginia was amended, and that’s the section that covers requirements for those who record a mechanics lien. Just a few words were added here. For one, liens must include the address of the property owner. Further, lien claims must also include the date from which interest is claimed. Meaning: if interest is accruing on the debt that’s unpaid, the lien claim must also cite the date from which interest began accruing.
§43-5, §43-8, and §43-10 were also amended. These are the 3 different forms set out in its lien statute that claimants can (but aren’t required to) use. Each of those forms was edited by adding the following sentence underneath the amount of the lien:
“If any part of the Amount claimed is not due as of the date of this mechanic’s lien, identify the date or event upon which it will be due and the sum(s) to which the due date(s) or event(s) apply:_______”
Not all that much! Let’s break it down by section(s)…
As far as the “interest” amounts being added under §43-4, that’s actually not much of a difference at all. For lien claimants who use the forms provided in the state’s lien statute, these amounts are already included. For the date which is now required under §43-4 (“the date from which interest is claimed”) – that was already required by the statutory forms, too. Beforehand, these dates weren’t actually required by statute. To put these two these changes simply: the statutory requirements set out by §43-4 now better reflect the statutory forms provided by the Commonwealth of Virginia.
For those who use the statutory form for Virginia mechanics liens, it means there’s another sentence added to the form, along with a new blank. If there are amounts in the lien claim that aren’t yet due – like retainage that’s not due yet, or payments being withheld under a valid pay if paid or pay when paid clause – then those amounts should be designated on the form. But, if there’s no pay if paid or pay when paid clause, and if there aren’t any amounts included in the lien claim that haven’t been earned yet, then the claim won’t really change much here. The additional sentence doesn’t create any new requirement. The same amounts are lienable as before. However, now, the statutory form wants its users to identify any amounts not yet due.
Need to file a Virginia mechanics lien?
How to File a Virginia Mechanics Lien
It’s generally a good idea to use the forms that have been provided by statute in Virginia. Not every state specifically sets out forms for mechanics liens, and that can be pretty annoying considering how strict and specific courts can be regarding lien claims, their contents, and even their formats. Virginia actually provides three separate forms that can be used, and which form is most appropriate will depend on the mechanics lien claimant’s role on the project (i.e. whether they’re hired by the owner, hired by the GC, or hired by someone else).
As mentioned above, these forms are not strictly required, per se. But, the Virginia mechanics lien statute does say that the templates featured in the statute will be sufficient (as long as the correct form is used, based on the lien claimant’s role). However, when the statutory form is used, a lien claimant is given a sort of “benefit of the doubt.”
For a deeper look, here’s an article we just posted on the subject: Virginia Mechanics Lien Claimants: Flawed Liens Can Still Lead to Recovery.
A recent case, Desai v. Design Group Inc., shows how beneficial it can be to play it safe by using the forms provided in the Virginia mechanics lien statute. In that case, the lien claimant, A.R. Design Group, used the template found at §43-5 of Virginia’s mechanics lien statute (prior to these new changes described above).
There was a lot of analysis done by the court, but one of the major themes of the court’s opinion was that because this claimant had used the form which was specifically allowed by the state’s lien statute, any potential deficiencies with the form itself weren’t all that big of a deal. According to the court, since the form was explicitly “sufficient” according to the legislature, that same form couldn’t also be struck down as insufficient.
Virginia Mechanics Lien Overview
About Virginia Preliminary Notices
The Virginia mechanics lien forms created by the state's lien statute have been updated. Only a sentence was added to the previous VA mechanics lien forms.