The team at Northwest Lien believes in the power of mechanic’s lien — we say it all the time! Filing a mechanic’s or construction lien is one of the fastest ways of receiving payment rightfully owed to contractors, subcontractors, and laborers.
We recognize, however, the process of filing a mechanic’s lien can be time-consuming and stressful like any other legal process, especially if you’re doing it on your own. Thanks to the mounting frustration expressed by general contractors and property owners alike, several states established another legal tool — the Notice of Commencement — to help contractors manage their lien rights more efficiently and promote communication between all parties. Read on to learn more about the Notice of Commencement and how it relates to Washington state and Oregon.
A Notice of Commencement is a document signifying the official start date of, and the parties involved in, a construction project. It promotes clarity and communication between the parties, and allows them to organize their lien notices and waivers more effectively. Ultimately, this document is a preemptive tool to help ensure all contracts are upheld, all parties are paid, and no mechanic’s lien claims are necessary. You may have heard the Notice of Commencement called by alternative names such as “affidavit of commencement” or “notice of project commencement” — all terms refer to the same process.
As any of the names indicate, the most important information you must include on this document is the exact start date, or commencement date, of the construction project. The date listed should match the date the contractors, subcontractors, and suppliers first start contributing labor or construction materials to the project.
Other information typically included on a Notice of Commencement includes:
The property owner or another party with significant interest typically files the Notice of Commencement. Taking this action affects future construction lien notices and preliminary liens by setting deadlines for material handlers, suppliers, and other parties to the construction project. A Notice of Commencement protects the property owner and general contractor by creating additional steps and limits the time any party can file a lien claim. The property owner should also sign the Notice of Commencement form before filing it with the county.
A quick history lesson! For fun, we guess. The first known use of a mechanic’s lien occurred more than 200 years ago and featured the work of two of America’s founding fathers, James Madison and Thomas Jefferson. Passed by the Maryland legislature, the mechanic’s lien was the first of its type in the world. The intention of the original mechanic’s lien was to protect parties such as laborers and material suppliers from improper payments.
While the mechanic’s lien has worked well in the United States since the late 1700s, legislatures have attempted to improve fairness to all parties involved in a construction project over the years. This includes the property owner and lenders who provide project financing. As projects became more complex and started to involve more people, lenders, general contractors, and property owners struggled to keep track of funds from various parties coming into the project. The Notice of Commencement greatly improved the process.
Only five states formally require this type of notice in 2020 — none of which are within the Northwest. However, all parties to a construction project can better protect their interests by signing one.
The original purpose of the preliminary notice was to allow property owners to track the suppliers and subcontractors contributing to the construction project. Lien waivers — not to be confused with lien releases — helped property owners know who had and had not received payment for their work. The problem with this process is that property owners didn’t always know who was present at a job site, leaving them open to receiving lien claims from parties they weren’t even aware were working on their property.
The second problem with this approach is that suppliers and subcontractors don’t always have detailed information about every construction project they work on available to them. This makes it challenging for workers to inform property owners of their work at the site and request payment from them.
The Notice of Commencement eliminates these problems by providing a construction job start date. Suppliers and subcontractors also have detailed information available to them regarding the scope of the job and who is working at the construction site. This prevents them from experiencing common problems such as making double payments.
No. Washington does not require any party to complete a Notice of Commencement before beginning a construction project.
Learn more about filing a mechanic’s lien in Washington.
No. Oregon does not require any party to complete a Notice of Commencement before beginning a construction project. Learn more about filing a mechanic’s lien in Oregon.
Currently, only Florida, Georgia, Iowa, Michigan, Ohio, and Utah require a Notice of Commencement; Nebraska, South Carolina, South Dakota, and Texas make it optional.
While it’s not required in either of our primary states of service, the team at Northwest Lien highly recommends you complete and file the Notice of Commencement form to protect your financial interests, speeding up payment and avoiding common errors. Now that you understand the Notice of Commencement definition, we invite you to contact Northwest Lien Service to satisfy queries about it. You may reach us by phone at 425-620-3155, by email at info@northwestlienservice.com, or by completing an information request form below.
