Subcontractors and Suppliers Beware: Your Rights to Mechanics Liens May Soon Be Slashed

A mechanics lien is an extraordinary and powerful tool for subcontractors and suppliers seeking recovery for nonpayment. Although all states differ in the specifics of their mechanics’ lien laws, Pennsylvania has traditionally maintained very strong mechanics’ lien laws to the benefit of subcontractors and suppliers. Although the requirements for placing a mechanics’ lien on a piece of property in Pennsylvania are rigid and extremely detailed, mechanics’ liens for new construction take priority over almost all other liens.

However, House Bill 1602 (“HB 1602”) may change that. This bill seeks to alter mechanics’ lien laws to make them more favorable to property owners and, thus, more difficult for subcontractors and suppliers to obtain. While HB 1602 still needs to be approved by the Senate and signed by the Governor, if it’s passed in its current form, it would place new obstacles in the path of subcontractors and suppliers seeking repayment.

As it stands now, HB 1602 would allow property owners to file a “Notice of Commencement” (“NOC”) which would need to be posted conspicuously on the job site and delivered to the general contractor within seven (7) days of filing. Should a property owner choose to file a NOC, all subcontractors and suppliers would be required to file a “Notice of Furnishing” (“NOF”) within twenty (20) days of commencement of work or delivery of materials. Should a subcontractor or supplier fail to file a NOF within the required time period, their lien rights will be lost. Additionally, the general contractor must only give a subcontractor or supplier a copy of the NOC if asked to do so by written request.

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