When contractors or suppliers in Kentucky are not paid for their work on a construction project, they have the right to file a mechanics lien to ensure they receive payment. A mechanics lien grants the unpaid party a legal claim on the property as security. Those who perform labor or supply materials under a construction contract can file a lien on the improved property, highlighting the importance of such contracts in securing legal protections.
At CRM Lien Services, we specialize in ensuring that you get paid quickly and reliably. We can prepare and file mechanics liens for you in accordance with Kentucky law, taking into account Kentucky construction lien law and state-specific rules and regulations, including the need for an adequate and ascertainable description of the real estate.
Here are the essential rules, requirements, and deadlines to comply with when filing a mechanics lien Kentucky.
Key Takeaways
- Eligibility for Filing: Prime contractors, subcontractors, material suppliers, equipment lessors, and licensed design professionals have the right to file a mechanics lien in Kentucky, while suppliers to suppliers do not.
- Preliminary Notice Requirements: Parties who do not have a direct contract with the property owner must send a Notice to Owner within 75 days of last providing labor or materials to secure lien rights.
- Filing and Deadlines: A Kentucky mechanics lien must be filed with the county clerk’s office within 6 months of the last significant work or material supply, and claimants have 1 year to enforce the lien through legal action if payment isn’t made.
Who Is Eligible to File a Kentucky Mechanics Lien?
In Kentucky, those eligible to file a mechanics lien include general contractors, subcontractors, sub-subcontractors, material suppliers, equipment rental companies, and licensed design professionals (such as architects, engineers, and surveyors) who have a direct contract with the property owner. However, suppliers who provide materials to other suppliers are not granted mechanics lien rights in the state. Eligible parties can hold the property liable for the amount claimed by notifying the property owner or their authorized agent of their intent to do so.
Can an Unlicensed Contractor Legally File a Kentucky Mechanics Lien?
In Kentucky, contractors are not required to hold a specific license to file a mechanics lien, though working without proper licensing is generally not advisable.
On the other hand, design professionals, including architects, engineers, and surveyors, must be properly licensed for their mechanics lien claim to be considered valid in Kentucky.
Is a Legal Property Description Required for a Kentucky Mechanics Lien?
No, Kentucky law only mandates that the lien statement contains a property description that is “sufficiently accurate to identify” the property. A complete legal description of the property is not necessary to meet this requirement.
Can a Kentucky Mechanics Lien Be Filed on a Condominium Project?
Yes, a mechanics lien can be placed on a specific condominium unit, just like any other property, as long as the claimant holds valid mechanics lien rights.
Does a Kentucky Lien Have Priority Over Existing Mortgages or Construction Loans?
In Kentucky, mechanics liens generally have priority over liens or encumbrances placed on the property after the mechanics lien. The lien’s priority “relates back” to the date when labor began or materials were supplied. When there are multiple mechanics liens, none take precedence, and if funds are insufficient to cover all claims, they will be divided pro rata. The Kentucky Supreme Court has ruled on various issues related to lien priority and construction disputes, shaping the legal landscape for these matters.
If the total mechanics lien claims exceed the original contract amount, the contract value acts as a cap and is distributed pro-rata among all claimants. Mechanics liens do not take priority over mortgages, contract liens, or bona fide property transfers unless the lien claimant files a statement with the county clerk before the mortgage or lien is recorded, indicating labor or materials provided and the expected payment.
• Filing the optional preliminary notice preserves priority over any subsequent mortgages without notice.
Who Must Send a Preliminary Notice for Private Projects in Kentucky?
Kentucky does not mandate a “traditional” preliminary notice at the start of a project to protect lien rights. However, two notices can impact a claimant’s lien rights in the state.
Notice to Owner
All parties who did not directly contract with the property owner must send a Kentucky Notice to Owner before filing a mechanics lien claim.
Notice of Contract
Although not required to secure lien rights, filing a Kentucky Notice of Contract offers benefits. It helps preserve the lien claimant’s priority over any future mortgages or property transfers recorded after the notice.
What Is the Proper Way to Send a Private Preliminary Notice in Kentucky?
Notice to Owner
Kentucky statutes do not specify a particular delivery method for the Notice to Owner. However, you must have proof of mailing it to the owner’s last known address. To ensure this, it’s recommended to send the Notice of Contract via first-class or certified mail.
Notice of Contract
The Notice of Contract must be filed with the county clerk’s office in the county where the property is located. Additionally, certain documents, such as mechanics liens and notices, must be recorded with the county recorder’s office to ensure legal compliance and secure lien priority. This can be done either in person or by mail.
Important Facts About Kentucky Mechanics Lien Law
Contractors and suppliers enjoy robust lien rights in Kentucky. If a contractor or supplier isn’t paid on a project, filing a mechanics lien can help secure payment. However, strict rules and guidelines must be followed. Public improvement liens do not attach to property owned by a charter county government but only to the funds due to the contractor.
Here are 5 key points to understand about Kentucky’s mechanics lien law:
1. Suppliers to Suppliers Lack Lien Rights – Others Are Covered
In Kentucky, suppliers to suppliers are the only project participants without lien rights. Prime contractors, subcontractors, sub-subcontractors, material suppliers, equipment lessors, and licensed design professionals all have mechanics lien rights. Design professionals like architects, engineers, and surveyors must be licensed to file a lien, while other parties may not have this requirement, though having a license is always recommended.
2. Preliminary Notice Depends on Project Tier and Type
Kentucky doesn’t require notice at the start of work, but some parties must provide notice after finishing work or delivering materials and before filing a lien. For owner-occupied residential projects, parties without direct contracts must send a preliminary notice within 75 days of last providing labor or materials. On other residential and commercial projects, notice is required within 75 days if the claim is under $1,000 and within 120 days for claims over $1,000. Failing to send the necessary preliminary notice will invalidate the lien.
3. File the Lien on Time and Notify the Property Owner
All parties must file their Kentucky mechanics lien within 6 months of last providing labor or materials. After filing, a copy of the lien statement must be sent to the property owner within 7 days. Sending this notice by certified mail is recommended, as proof of delivery is necessary to validate the lien. Once filed, lien claimants must enforce the lien through legal action within 12 months.
4. Legal Property Description Not Required
Kentucky does not mandate a fully legal property description in the lien statement. Instead, the property must be described “sufficiently accurate to identify it.” While this standard may vary between counties, including the best possible property description, even a legal description, when available, is always a safe approach.
5. Competing Mechanics Liens Share Pro-Rata
In Kentucky, mechanics liens typically take priority over encumbrances created after the lien is filed. However, when multiple mechanics liens are involved, they do not have priority over one another. If foreclosure proceeds aren’t enough to cover all claims, the funds are distributed on a pro-rata basis. The total recovery amount is capped at the original contract value, and all lien claimants must share that amount.
Understanding Kentucky Mechanics Lien Law
A mechanics lien Kentucky is a legal claim against a property that can be filed by contractors, subcontractors, suppliers, and other parties who have provided labor or materials for a construction project. This lien serves as a powerful tool for recovering payment from delinquent clients, ensuring that those who contribute to the improvement of a property are compensated for their efforts. By filing a mechanics lien, the claimant secures a legal interest in the property, which can be used to enforce payment for the work performed or materials supplied.
Definition of a Mechanics Lien
A mechanics lien is a type of lien that is filed against a property to secure payment for labor or materials provided for a construction project. Typically, this lien is filed by a contractor, subcontractor, or supplier who has not been paid for their contributions. The mechanics lien becomes a matter of public record once it is filed with the county clerk’s office in the county where the property is located. This public record serves as a notice to all parties that the property is encumbered by the lien, which must be resolved before the property can be sold or refinanced.
Pre-Lien Requirements
Before filing a Kentucky mechanics lien, there are several pre-lien requirements that must be met to ensure the lien is valid and enforceable. These requirements include serving a notice to the property owner and filing a notice of contract with the county clerk’s office. Adhering to these steps is crucial for protecting your lien rights and securing payment for your work or materials.
Notice to Property Owner
The notice to property owner is a required pre-lien notice that must be served on the property owner before filing a Kentucky mechanics lien.
This notice must be served at least 7 days before filing the lien and must include the following information:
- The name and address of the lien claimant
- A description of the work performed or materials provided
- The amount of money owed to the lien claimant
- A statement indicating that the lien claimant intends to file a mechanics lien if payment is not made
The notice to property owner can be served by certified mail, return receipt requested, or by personal service. This step ensures that the property owner is aware of the outstanding payment and has an opportunity to resolve the issue before a lien is filed.
Notice of Contract
A notice of contract is another pre-lien notice that must be filed with the county clerk’s office before filing a Kentucky mechanics lien.
This notice must include the following information:
- The name and address of the lien claimant
- A description of the work performed or materials provided
- The amount of money owed to the lien claimant
- A statement indicating that the lien claimant has a contract with the property owner for the work performed or materials provided
Filing the notice of contract with the county clerk’s office before the recording of any mortgage or other contract encumbrances is essential. This filing provides lien priority, ensuring that the lien claimant’s rights are protected against subsequent encumbrances.
By following these pre-lien requirements, contractors, subcontractors, and suppliers can safeguard their rights and improve their chances of recovering payment for their work or materials. Given the complexity of Kentucky mechanics lien law, consulting with a Kentucky construction attorney is recommended to ensure all requirements are met.
How to File a Mechanics Lien in Kentucky?
If you’ve been left unpaid on a construction project in Kentucky, it’s understandable that you’re frustrated. Fortunately, Kentucky offers a powerful legal remedy called mechanics lien rights, which can help you recover the money owed. Although using these rights can seem complex, the process doesn’t have to be difficult. Here’s a straightforward guide on how to file a mechanics lien in Kentucky. Consulting with Kentucky construction attorneys can help you navigate the filing process successfully.
Before Filing a Kentucky Mechanics Lien
Before jumping into filing a lien, consider these important questions:
- Is it the right time to file a lien?
- Are you eligible to file a lien?
- Was notice required to preserve your lien rights?
Is It Time to File a Mechanics Lien?
If you’re considering filing a lien, you’re probably already leaning toward it. However, it’s important to remember that a mechanics lien is a last resort. There are often other ways to recover your payment without damaging business relationships or involving legal action. Sometimes, simply threatening to file a lien, such as sending a Notice of Intent to Lien, is enough to secure payment.
Who Can File a Kentucky Mechanics Lien?
Kentucky has broad mechanics lien rights, but not everyone is eligible. Confirm your ability to file a lien before proceeding.
The following parties can file a Kentucky mechanics lien:
- Prime contractors
- Subcontractors
- Sub-subcontractors
- Material suppliers
- Equipment lessors
- Licensed design professionals (architects, engineers, surveyors)
However, suppliers to other suppliers are not protected under Kentucky’s mechanics lien law.
Is Notice Required to Secure Your Lien Rights?
While Kentucky does not require a notice before work begins, there are specific notices that need to be sent depending on the project. Contractors may file a Notice of Contract to protect the priority of their lien. If this notice isn’t filed, mortgages or transfers made after work begins might take priority over your lien.
Additionally, a Notice to Owner must be sent by any party that didn’t contract directly with the property owner. This notice must be sent within 75 days of the last date you provided labor or materials.
What Information Is Needed for the Lien?
To file a mechanics lien Kentucky, specific details must be included.
Although Kentucky doesn’t provide a standard lien form, the following information is required:
- The claimant’s name and address
- The amount owed
- A property description “sufficiently accurate to identify it”
- The property owner’s name
- A statement about whether the work or materials were provided under a direct contract or through a subcontract
Remember, the lien statement must also be notarized.
When to File
In Kentucky, a mechanics lien must be filed within 6 months of the last date of significant labor or material delivery. Minor tasks or warranty work typically won’t extend the filing deadline, so it’s best to use a conservative last work date.
Filing the Lien and Sending Notice
File the lien at the County Clerk’s Office in the county where the property is located. It’s wise to confirm the filing fees with the clerk’s office beforehand. After filing, you must send the lien statement to the property owner within 7 days. Although proof of service isn’t required, it’s strongly recommended to avoid any issues.
What Happens After Filing?
There are two deadlines to keep in mind with a Kentucky mechanics lien: the filing deadline and the enforcement deadline. After filing, if payment isn’t made, the lien must be enforced within 1 year through legal action.
However, a year is ample time to negotiate and resolve disputes without going to court. If payment is still not made, consider sending a Notice of Intent to Foreclose to prompt action without filing a lawsuit. This notice serves as a final warning, stating that you will enforce the lien if payment is not received.
Get in Touch
Filing a mechanics lien in Kentucky is a powerful legal tool for contractors and suppliers to secure payment on construction projects. By understanding the rules, eligibility requirements, and deadlines, you can effectively protect your financial interests.
At CRM Lien Services, we have been serving customers across the country with required reference documentation for lien claims since 1986. We assist property owners in navigating the mechanics lien process, informing them about their rights and responsibilities, including providing notices, securing payment, and releasing mechanic’s liens.
We have a wealth of expertise, are licensed and insured, and have a team of highly knowledgeable document processors. If you’re looking for a straightforward process for filing a mechanics lien, give us a call or shoot us an email.
