If contractors or suppliers are not paid for their work on a Wisconsin construction project, they have the option to file a mechanics lien to ensure payment. A mechanics lien grants the unpaid party a legal claim on the property itself.
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 Wisconsin law, taking into account Wisconsin construction lien law and state-specific rules and regulations, including the need for an adequate and ascertainable description of the real estate.
This guide outlines the essential rules, steps, and deadlines you must follow to successfully file a mechanics lien Wisconsin.
Key Takeaways
- Broad Eligibility for Mechanics Lien Rights: In Wisconsin, anyone who provides labor or materials for the construction or improvement of a property, including design professionals, has lien rights.
- Strict Notice and Filing Deadlines: Mechanics liens must be filed within 6 months of the last work provided, with a 30-day notice requirement prior to filing. Proper planning is crucial.
- No Additional Fees Allowed: Wisconsin mechanics liens only cover labor or materials provided. Fees such as attorney’s costs or lost profits cannot be included in the lien amount.
- Importance of a Written Contract: Having a written contract is crucial for outlining lien rights and obligations. It should include specific notices to owners detailing the responsibilities of both prime contractors and subcontractors and the consequences of not having such a contract in place.
What is a Mechanics Lien?
A mechanics lien is a powerful legal tool that allows contractors, subcontractors, and suppliers to secure payment for their work or materials by placing a lien on the property they have worked on. In Wisconsin, a mechanics lien is a statutory right that provides a security interest in the property, ensuring that lien claimants have a legal avenue to seek payment from the property owner.
This lien creates a claim against the property, which can ultimately lead to a foreclosure if the debt remains unpaid. By filing a mechanics lien, construction stakeholders can protect their financial interests and ensure they are compensated for their contributions to a project.
Who Is Eligible to File a Wisconsin Mechanics Lien?
In Wisconsin, anyone who provides labor or materials for constructing, modifying, repairing, or improving a building or structure is entitled to mechanics lien rights, no matter their level of involvement in the project.
Additionally, design professionals, including architects, engineers, surveyors, and construction managers, also have mechanics lien rights as long as visible work on the project eventually begins.
Can an Unlicensed Contractor File a Mechanics Lien in Wisconsin?
Yes, Wisconsin does not have any specific licensing requirements to file a mechanics lien. However, it is always advised to avoid performing work that requires a license unless you are properly licensed.
What Is the Deadline to File a Wisconsin Mechanics Lien?
In Wisconsin, a mechanics lien must be filed within six months from the last date labor or materials were provided to the project. However, it must be filed at least 30 days after submitting a written notice of intent to file a claim of lien.
What Details Must Be Included in a Wisconsin Mechanics Lien?
A Wisconsin Lien Statement is regulated by W.S.A. § 779.06 and must include the following details:
- Information about the property owner
- Claimant’s information
- The last date labor or materials were supplied
- A description of the contract or demand on which the claim is based
- Description of the property
- The lien amount
- Any other relevant facts concerning the claim
- Copies of both the Preliminary Notice and Notice of Intent to Lien, provided in accordance with statutory requirements
Where Should a Wisconsin Mechanics Lien Be Filed and Recorded?
In Wisconsin, mechanics lien claims must be filed with the Clerk’s Office of the Circuit Court. To ensure your lien is valid, it must be recorded in the county where the project is located. Each county in Wisconsin has its own set of rules and regulations.
To assist you, we’ve compiled a list of offices in Wisconsin that handle mechanics lien filings. These guides provide information on each county’s specific formatting rules, deadlines, fees, filing process, and answers to commonly asked questions.
Who Cancels the Wisconsin Mechanics Lien When Payment Is Made?
Once a lien has been satisfied, the lien claimant must complete and file a Satisfaction of Claim of Lien. If the claimant refuses to do so, they could be held liable to the interested party for an amount equal to 1.5 times the lien’s value.
Rules and Requirements for Sending a Wisconsin Preliminary Notice
Deadline for Property Owner / Public Entity to Send Wisconsin Preliminary Notice
To maintain mechanics lien rights, subcontractors in Wisconsin must serve a “Subcontractor Identification Notice” on the property owner within 60 days of the first date they furnish labor or materials on a project. While there are some exceptions (consult an attorney for specific cases), it’s generally a good practice to send this notice for every project. If the notice is sent after the 60-day period, lien rights will only apply to the labor or materials provided after the notice was delivered.
Information to Include in a Wisconsin Preliminary Notice
- First Date of Labor or Material Delivery: This is the date you first provided labor or delivered materials to the project.
- Last Date of Labor or Material Delivery: This is the most recent date you worked on or supplied materials to the project.
- Description of Labor/Materials: Clearly describe the work you performed or the materials you supplied, explaining in simple terms that anyone can understand.
Who Should Receive the Wisconsin Preliminary Notice?
After completing the Wisconsin Subcontractor Identification Notice, you must send it to the property owner or relevant public entity, along with an Affidavit of Service. For sub-tier parties, this notice is also typically served on the general contractor. Additionally, it’s wise to send the notice via registered or certified mail to ensure proper delivery and maintain proof of service to other parties involved in your payment process, such as the lender or surety company for the project.
5 Things to Know About Wisconsin Mechanics Liens
In Wisconsin, contractors and suppliers have robust mechanics lien rights that can be utilized if payment is delayed or withheld. However, strict requirements must be followed to ensure these lien rights are preserved.
Here are five key things to know about Wisconsin’s mechanics lien laws.
1. Lien Rights Apply Regardless of Tier
Any party involved in providing labor or materials for the erection, alteration, repair, or improvement of a building in Wisconsin has mechanics lien rights, regardless of their tier in the project. This includes sub-subcontractors, as well as design professionals such as architects, engineers, surveyors, and construction managers, provided that visible construction eventually takes place.
2. Two Important Deadlines for Filing a Mechanics Lien
In Wisconsin, all parties must file their mechanics lien within six months of the last date labor or materials were provided. Additionally, the lien cannot be filed until at least 30 days after delivering a Notice of Intention to Claim a Lien. Importantly, this notice does not extend the six-month filing period, so it must be sent well before the deadline.
3. Preliminary Notice Is Required for All Parties
Preliminary notice and a Notice of Intent to Lien are mandatory for everyone involved in the project. General contractors must either provide notice within the contract or within 10 days after beginning work. Subcontractors and suppliers must deliver a preliminary notice within 60 days of first furnishing labor or materials. While commercial projects may not always require it, delivering a preliminary notice is a good practice. All parties intending to file a lien must also deliver a Notice of Intent to Lien at least 30 days before filing the actual lien.
4. Legal Property Description Required
In Wisconsin, a mechanics lien must include the legal description of the property, not just a general or sufficient description. This is a stricter requirement than in some other states.
5. No Additional Fees Included in the Lien Amount
Unlike in some jurisdictions, Wisconsin does not allow claimants to include additional fees like attorney’s fees, lost profits, or other indirect damages in the lien amount. Only the value of labor or materials provided can be claimed.
How to File a Wisconsin Mechanics Lien?
Filing a mechanics lien is a legal right available to individuals and companies working on construction projects in all 50 states, including Wisconsin. This guide outlines the step-by-step process for filing a mechanics lien in Wisconsin.
Why File a Mechanics Lien?
Sometimes, payment issues arise on construction projects. Filing a mechanics lien ensures you protect your right to be paid. Though filing a lien is a last resort, it’s essential to be prepared when the need arises. Here’s how to file a Wisconsin mechanics lien.
Did You Sign a Lien Waiver?
Before diving into the lien process, make sure you haven’t signed a lien waiver. Wisconsin takes lien waivers seriously, and if you’ve signed one, it may affect your lien rights. Always check before filing a claim.
Who Can File a Wisconsin Mechanics Lien?
Wisconsin has broad mechanics lien protections. Anyone involved in the construction process, from contractors to suppliers, can file a lien, but it’s important to follow the proper steps before submitting a claim.
Notice Requirements in Wisconsin:
Wisconsin has two key notice requirements:
- Preliminary Notice: This should be sent early in the project to preserve lien rights.
- Notice of Intention to Lien: All claimants must send this at least 30 days before filing the lien.
Sending a Preliminary Notice:
- Prime Contractors: Must deliver a Notice of Lien Rights within 10 days of starting the project.
- Subcontractors: Need to send a Subcontractor Identification Notice within 60 days of first furnishing labor or materials. Failure to send notice may jeopardize lien rights.
Wisconsin Notice of Intention to Lien:
Before filing the lien, all claimants must send a Notice of Intention to File a Lien at least 30 days in advance. Proper planning is critical to ensure you meet the lien deadlines.
Wisconsin Mechanics Lien Deadline:
A Wisconsin mechanics lien must be filed within 6 months of the last day you provided labor or materials. Additionally, the lien can only be filed 30 days after sending the Notice of Intention to Lien.
What Information Should Be Included in the Lien Claim?
To file a valid lien, the following must be included:
- Copies of the Preliminary Notice and Notice of Intention to Lien
- Statement of the contract or demand
- Names of the owner and claimant
- Last date labor or materials were provided
- Legal property description
- The claim amount
- Relevant facts: Make sure the lien is signed by the claimant or their attorney.
How to File:
File the lien claim with the Clerk of Circuit Court in the county where the property is located. Then, serve the property owner with a copy within 30 days after filing.
Enforcing a Wisconsin Mechanics Lien:
After filing the lien, you have two years to enforce it through legal action if payment is still unresolved. If no action is taken within this period, the lien will expire.
Before Enforcing, Try One More Step:
Before filing a lawsuit, consider sending a Notice of Intent to Foreclose. This warning can motivate payment without resorting to legal action. In most cases, payment disputes are resolved before reaching this stage.
By following these steps, you can protect your right to payment on Wisconsin construction projects. Always ensure you meet all deadlines and requirements to maintain your lien rights.
Lien Waivers and Releases
Lien waivers and releases are essential documents in the mechanics lien process, serving as a means to waive or release a lien claim. In Wisconsin, a lien waiver acts as a complete defense against the enforcement of a mechanics lien. When a contractor or subcontractor signs a lien waiver, they relinquish their right to file a lien on the property, providing peace of mind to the property owner. These documents are crucial in managing and mitigating potential lien claims, ensuring that all parties are clear about their rights and obligations.
What is a Lien Waiver?
A lien waiver is a document that contractors or subcontractors sign to waive their right to file a mechanics lien on a property. In Wisconsin, a lien waiver can be signed either before or after the work is performed, but it must be executed before the lien is filed. This waiver serves as a protective measure for property owners, safeguarding them from potential lien claims.
However, it is important to note that while a lien waiver prevents the filing of a lien, it does not waive any contractual rights between the property owner and the contractor. This distinction ensures that the contractual obligations and rights remain intact, even as the lien rights are waived.
Common Mistakes to Avoid
When filing a mechanics lien Wisconsin, it is crucial to avoid common mistakes that can jeopardize the validity of your lien claim. These errors can lead to the invalidation of the lien or the loss of payment, making it essential to be meticulous and thorough throughout the process.
Failure to Use a Legal Description for a Property
One of the most common mistakes is failing to use a legal description for the property in question. In Wisconsin, a mechanics lien must include the legal property description, not just a general or sufficient description. This legal description can be obtained from the county recorder’s office or a title company and must be accurate and complete.
Failing to use the correct legal property description can result in the invalidation of your lien claim, leaving you without the security interest needed to ensure payment. Always double-check the property description to avoid this critical error and protect your mechanics lien rights.
Get in Touch
Filing a mechanics lien in Wisconsin is a powerful tool for contractors, suppliers, and others in the construction industry to secure payment for their work. By adhering to the specific rules and deadlines outlined in this guide, you can protect your lien rights and avoid potential pitfalls. Remember to provide the necessary notices, file your lien within the required timeframes, and include all essential information.
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.
