What is a Notice of Commencement?
A Notice of Commencement is a document that states the beginning date of a project or the date on which a service provider first provided services. It's filed with the corresponding local office in the county or state where the project is located. Generally, it must be provided to other project participants and posted on the job site somewhere for everyone to see.
The owner or the prime contractor is often the one who files this notice. But this initial notice may result in the sub-contractor having to file subsequent notices. It just depends on the local laws and guidelines.
It's important to know that the filing of a Notice of Commencement can also impact the deadlines and filing timeline for "second-tier contractors." This can help the original filer because it creates a limit on when a lien can be filed and limits the amount of liability for such a lien.
The timeline for filing a mechanics lien often starts when you first provided services to a project. This is where the Notice of Compliance comes in handy because it establishes a formal date for calculating all other deadlines. The notice is generally filed right before or shortly after the work on the project begins. Requirements vary by state, so check the laws of the state you're in to confirm the details.
Where is a Notice of Commencement Required?
As stated above, it tends to vary from state to state. Some states - such as Florida, Georgia, Iowa, Michigan, and Ohio - require that the Notice of Commencement be filed when a project is started for any party to file a mechanics lien later. While other states - such as South Carolina, South Dakota, and Texas - offer it as an optional protection that owners and prime contractors can use to limit the filing of mechanics liens after the project is complete.
It cannot be stressed enough that understanding the notice rules where your project is located is paramount and can protect you in the future. You will want to ensure you have a copy of the Notice of Commencement for your records to make sure you don't miss any filing deadlines.
How does the Notice of Commencement affect Subcontractors?
The filing of a Notice of Commencement by the general contractor or property owner affects and impacts the filing deadlines for subcontractors, material suppliers, equipment providers, and other parties providing labor or services to the job. A notice of commencement will establish the timeline for when and how much a lien can be filed for. It can also add additional requirements such as your own notice filed for the work you plan to do.
The easiest way to know if a notice of commencement has been filed is to look around the job site. Most states require the primary contractor to post it in a conspicuous place on the physical job site itself. You can also contact the general contractor for a copy of the notice.
If you want help generating a notice, we can help you do so in minutes. Our software enables you to pick and prepare any forms you need, eSign or send for signature, record this with the county clerk, and even file in court. Unlike other services, everything is included for one flat fee per case. Please don't hesitate to reach out with any questions.
