Lien Laws Update: Tennessee
If you are a construction worker in the state of Tennessee 2020 updates to the state lien laws may affect you. Whether you're serving as a contractor, subcontractor, sub-subcontractor, or material supplier, it's in your best interest to stay informed about these particular laws, even if you have yet to have personal need of utilizing a bond claim.
What Are the Changes?
Recently, in 2020, the state of Tennessee enacted changes to it's lien statute via the
passage of a new amendment. This amendment was regarding the preliminary notice
served for a private commercial project and they affect any contract created and
entered after or on July 1, 2020. The major change brought about by this amendment is
that any contract created after the specified date means that the claimant is no longer
required to serve a "Notice to Owner" before supplying material or labor.
This amends the pre-2019 policy which stated that the claimant was required to serve the owner, with whom they had a direct contract, a "Notice to Owner." This notice had to be served prior to the claimant's first day supplying labor or material.
What is a Notice to Owner?
Essentially, a "Notice to Owner" is meant to notify the owner of the project that work is going to commence. This is intended to protect the contractors supplying the labor and material and ensure they are later able to receive their payment if there is an issue with the owners of the project attempting to withhold it.
Who Still Needs to Serve a Notice to the Owner?
According to the 2020 amendment, the only people still required to file and serve a "Notice to Owner" are prime contractors who have been hired directly by the owner of a residential project. The specific type of residential project that still requires this notice is an owner-occupied, 1-4 unit residential project in which the owner intends to reside when the work is finished. Essentially, if a contractor is building or working on a residential home meant for the person owning the home in question, they will still need to serve the "Notice to Owner." Tennessee's amendment considerably relaxed the requirements around the "Notice to Owner." Other than residential homes, it is no longer necessary for contractors to send them.
Do You Still Need to Serve?
If you're in Tennessee and you are in the small category of contractors who still need to
send out the "Notice to Owner" form, Nationwide Notice, Inc. can help you get started. If
you fail to properly send the required notice, it could void your claim to a lien in the
event that you are not properly compensated for your labor.
Don't take the risk of losing your hard-earned money! Nationwide Notice, Inc. makes the process as easy as possible. If the 2020 Tennessee amendment did not remove your need to file a Notice to Owner, or if you need help with bond claims or other lien-related issues, don't hesitate to contact Nationwide Notice, Inc. As a full and self-service notice and lien company, our priority is to assist our clients to secure their payments. Nationwide Notice, Inc. can also assist construction companies by assisting with lien laws and related documents, based on the requirements of their state. Get started with us today - we are just a call or click away. For more information about how lien filing software can benefit you, contact Nationwide Notice, Inc. to discuss what we can do to help you protect your receivables.