Bill Text: MO HB2058 | 2010 | Regular Session | Comm Sub
Bill Title: Establishes procedures for asserting a mechanic's lien against certain residential real property
Spectrum: Partisan Bill (Republican 1-0)
Status: (Passed) 2010-07-12 - Delivered to Secretary of State (G) [HB2058 Detail]
Download: Missouri-2010-HB2058-Comm_Sub.html
SECOND REGULAR SESSION
SENATE COMMITTEE SUBSTITUTE FOR
HOUSE COMMITTEE SUBSTITUTE FOR
HOUSE BILL NO. 2058
95TH GENERAL ASSEMBLY
Reported from the Committee on General Laws, May 10, 2010, with recommendation that the Senate Committee Substitute do pass.
TERRY L. SPIELER, Secretary.
4976S.10C
AN ACT
To amend chapter 429, RSMo, by adding thereto one new section relating to mechanic's liens, with penalty provisions.
Be it enacted by the General Assembly of the State of Missouri, as follows:
Section A. Chapter 429, RSMo, is amended by adding thereto one new section, to be known as section 429.016, to read as follows:
429.016. 1. The provisions of this section shall only apply to mechanic's liens asserted against residential real property, other than mechanic's liens for the repair, remodeling, or addition to owner-occupied residential property of four units or less which are governed by section 429.013 and other applicable sections of this chapter.
2. As used in this section, the term "residential real property" means any parcel of real estate, improved or unimproved, that is intended to be used or is used for the construction of residential structures and related improvements which support the residential use of the land where such residential structures are intended, upon completion, either to be occupied or sold by the current owner. Such residential structures shall include any residential dwelling of four units or less, whether or not a unit is occupied by an owner and shall also include any structures consisting solely of residential condominiums, townhouses or cooperatives regardless of the number of units. The definition of "residential real estate" shall exclude any mixed use or planned unit developments except to the extent that any residential uses of such developments are, or will be, located on separate, identifiable parcels from the non-residential uses and then only as to those residential uses. Residential real property shall also include any streets, sidewalks, utility services, improved common areas, or other facilities which are constructed within the defined residential use structures or located on or within the separate and identifiable parcels identified as for residential use.
3. Any person or entity, hereinafter referred to as claimant, who seeks to retain the right to assert a mechanic's lien against residential real property, hereinafter referred to as property, shall record a notice of rights in the office of the recorder of deeds for the county in which the property is located. Such recorded notice of rights shall only apply to any work, labor, or materials performed or used to, on, or for the property in the future or in the immediately preceding sixty-day period from the date of such recording.
4. Notwithstanding subsection 3 of this section, a claimant that is accurately identified in any previously recorded notice of rights recorded as to the property is relieved of its duty to record a notice of rights.
5. If the last day to record the notice of rights falls on a Saturday, Sunday, or legal holiday recognized by the state of Missouri, the notice of rights shall be recorded not later than the next day that the office of the recorder of deeds is open for business.
6. Any claimant that fails to record such notice of rights shall be deemed to waive and forfeit any right to assert a mechanic's lien against such property. Despite any such waiver and forfeiture of mechanic's lien rights, the claimant shall retain all other rights and remedies allowed by law to collect payment for its work, labor, and materials.
7. Notwithstanding any other provision of this section, a notice of rights recorded after the owner's conveyance of the property to a bona fide purchaser for value shall not be effective to preserve the claimant's mechanic's lien rights to the property.
8. The notice of rights shall comply with section 59.310 and be on a form substantially as follows:
NOTICE OF RIGHTS
Date: The date of the document.
Owner: Identify Property owner, as "Grantor" by correct name.
Claimant: Identify Claimant, as "Grantee" by correct name, current address, contact persons, and current telephone number.
Property: The legal description of the property.
Person Contracting with Claimant for Work: Identify person or entity contracting with Claimant by correct name, current address, and current telephone number.
Persons performing work for or supplying materials to Claimant: Claimant may, but is not obligated to, identify any persons or entities which have or will be performing work or supplying materials on behalf of Claimant for the Property. Said persons or entities must be identified by correct legal name, address, and current telephone number.
A recorded notice correctly identifies a person or entity so long as the identifying information in the notice is neither deceptively similar to another person or entity reasonably likely to provide labor, materials, supplies, or equipment for the improvement of property nor so deficient in information as to make it unreasonably difficult to identify such person or entity. The form shall be signed by a person authorized to execute the form on behalf of the claimant, and such signature shall be notarized. The name of the person signing the form shall be printed legibly or typed immediately below the signature.
9. The notice of rights shall be recorded by the claimant in the office of the recorder of deeds of the county in which the property is located.
10. The recorder of deeds shall record such notice of rights in the land records and index notice of rights such that owners shall be deemed grantors and claimants shall be deemed grantees, and the grantor's signature shall not be required for recording.
11. (1) The owner of residential real property upon which a claimant is to perform or provide work, labor, or materials, or such owner's designated agent, shall provide any claimant with the name of the current record property owner and the deed, which deed shall include the legal description of the subject property, by which such owner of record obtained the subject property, within five calendar days after the owner, or its designated agent, receives a written request for the same from any claimant. The claimant may further request a copy of a survey of the subject property, a copy of the subdivision or other plat of the subject property, or such other information, document, or instrument, as may allow the claimant to identify the subject property with reasonable certainty, but the owner or its agent shall not be required to provide the same. The owner, or its designated agent, shall not be liable to any claimant, or other person, for any error, omission, or inaccuracy in the content of the deed described above which is provided and disclosed by the owner, or its designated agent, except as otherwise expressly provided in this section.
(2) If any owner, or its designated agent, fails to comply with the requirements of this section, the requesting claimant shall be entitled to receive, as its sole and exclusive remedy for failure to comply with this section, the claimant's actual and reasonable costs, excluding attorney fees, to obtain a legal description of the subject property necessary for the claimant to record its notice of rights. The costs described in this section shall be lienable expenses.
(3) If a claimant receives from the owner, or its designated agent, a copy of the deed by which the owner acquired title to the subject residential real property as contemplated in this section and the claimant relies in good faith upon the legal description contained in such deed and includes such legal description in a notice of rights as required in this section, and the claimant's notice of rights otherwise complies with the requirements of this section, then any such claimant's notice of rights shall be deemed to comply with the requirements of this section, and such claimant's right to assert a mechanic's lien as to the subject residential real property shall be retained even if subsequently it is determined that such legal description contained in such deed is in error or inaccurate as to the subject residential real property.
12. Each notice of rights or renewal notice of rights as hereafter provided shall only be valid for, and shall automatically expire, one year after recording, unless the claimant shall record a renewal of notice of rights with the recorder of deeds of the county in which the property is located prior to the expiration of any previously recorded notice of rights or renewal notice of rights, and any failure to record a renewal of notice of rights prior to the expiration of any previously recorded notice will constitute a waiver of lien rights as to the property. If a claimant fails to file its mechanic's lien prior to the expiration of any such one-year period, then the claimant's lien rights will be extinguished.
13. The recording of a notice of rights, or any number of renewal of notice of rights, shall not extend the time for filing a mechanic's lien as provided under section 429.080.
14. The renewal of notice of rights shall be in substantially the same form as the notice of rights. However, the renewal of notice of rights shall be titled as such and shall contain the date and recording information for the original notice of rights, as well as the dates and recording information for any earlier renewals of rights applicable to the property. A renewal of notice of rights affecting multiple lots must omit any lot for which the claimant has executed an unconditional final lien waiver.
15. A separate notice of rights shall be recorded for each lot or parcel of residential real property upon which the claimant performs its work. Nothing herein shall be construed to prohibit the claimant from providing a notice of rights covering multiple lots in the same subdivision if common ownership of lots exists. If the claimant commences its work prior to the platting or subdivision of a tract of land comprising residential real property, the claimant is only required to record one notice of rights provided that the entire tract of land upon which any such lien is to be asserted is described in such notice of rights.
16. The claimant shall not be required to provide the notice required under section 429.100, but compliance with the requirements of this section shall not relieve the claimant of its duty to comply with all other applicable sections of this chapter, except as specifically modified herein, in order to preserve, assert, and enforce its mechanic's lien rights.
17. For purposes of any mechanic's liens against residential real property only, a claimant satisfies the just and true account requirement contained in section 429.080 by providing the following information and documentation as part of its mechanic's lien claim filed with the clerk of the circuit court:
(1) A photocopy of the file-stamped notice of rights and any renewals of notice of rights recorded by or identifying claimant;
(2) The name and address of the person or entity which claimant contracted with to perform work on the property;
(3) A copy of any contract or contracts, purchase order or orders, or proposal or proposals, hereinafter collectively referred to as agreements, and any agreed change orders or modifications to such agreement or agreements under which claimant performed its work on the property;
(4) In the absence of any written agreement or agreements, a general description of the scope of work agreed to be performed by claimant on the property and the basis for payment for such work as agreed to by claimant and the contracting party;
(5) All invoices submitted by claimant for its work on the property;
(6) An accurate statement of account which shows all payments or credits against amounts otherwise due to claimant for the work performed on the property and the calculation or basis for the amount claimed by claimant in its mechanic's lien statement; and
(7) The last date that claimant performed any work or labor upon, or provided any materials or equipment to, the property;
(8) The claimant shall attach a file-stamped copy of his or her notice of rights to claimant's mechanic's lien statement if and when filed with the circuit clerk under section 429.080.
18. To the extent that any error in the information contained in the claimant's notice of rights prejudices the owner, any lender, disbursing company, title insurance company, or subsequent purchaser of the property, the claimant’s rights to assert a mechanic's lien shall be forfeited to the extent of the prejudice caused by such error.
19. A person having an interest in any residential real property against which a mechanic's lien has been filed may release such residential real property from any such mechanic's lien by:
(1) Depositing in the office of the circuit clerk a sum of money, in cash or certified check, an irrevocable letter of credit, which may be secured, issued by a federally or state chartered bank, savings and loan association or savings bank (referred to hereafter as a bank) authorized to and doing business in the state of Missouri, or a surety bond issued by a surety company authorized to do surety business in the state of Missouri and having a certificate of authority to do business with the United States government in accordance with 31 CFR Section 223.1, in an amount not less than one hundred fifty percent of the amount of the mechanic's lien being released; and
(2) Recording with the recorder of deeds and filing with the circuit clerk a certificate of deposit signed by the circuit clerk which provides the following information:
(a) Amount of money deposited, amount of the letter of credit deposited, or penal sum of the bond deposited, along with the name and address of the bank issuing the letter of credit or surety company issuing the bond, as well as a service address for the bank or surety company;
(b) Name of claimant, number assigned to the mechanic's lien being released, and the amount of the mechanic's lien being released;
(c) Legal description of the property against which the mechanic's lien was filed;
(d) Name, address, and property interest of the person making the deposit of money, providing the letter of credit or surety bond; and
(e) A certification by the person making the deposit of money, letter of credit, or surety bond that they have mailed a copy of the certificate of deposit to the claimant at the address listed on the mechanic's lien being released, along with a copy of any letter of credit or bond deposited by said person.
20. Any surety bond deposited as substitute collateral shall obligate the surety company, to the extent of the penal sum of the bond, to pay any judgment entered under section 429.210.
21. Any letter of credit deposited as substitute collateral shall obligate the issuing bank, to the extent of the amount of the letter of credit, to pay any judgment entered under section 429.210.
22. Upon release of the residential real property from a mechanic's lien by the deposit of substitute collateral, the claimant's rights are transferred from the residential real property to the substitute collateral.
23. Upon determination of the amount of claimant's claim, if any, against the substitute collateral, the court shall either:
(1) Order the circuit clerk to pay the claimant any sums awarded out of the deposited funds and release any remainder to the person or entity who made the cash deposit;
(2) Order the bank to issue payment under the letter of credit for the awarded amount but not exceeding the amount of the letter of credit;
(3) Render judgment against the surety company on the bond for the amount awarded up to but not exceeding the penal sum of the bond; or
(4) Release the substitute collateral
all as deemed appropriate by the court.
24. The deposit of substitute collateral and release of claimant's mechanic's lien shall not modify any aspect of the priority of claimant's interest, claimant's burden of proving compliance with the mechanic's lien statute, or claimant's obligations with respect to enforcement of its mechanic's lien claim, including, but not limited to, time for filing suit to enforce and necessary parties to the suit to enforce. It is the intent only that the deposited substitute collateral shall be the ultimate source of any potential recovery by claimant instead of the funds generated by foreclosure of the residential real property.
25. A release of a mechanic's lien under the deposit of substitute collateral shall not relieve any claimant of potential liability for slander of title or otherwise due to the filing of claimant's mechanic's lien.
26. The surety company for any bond or the bank which issued the letter of credit deposited under this section shall be made a party to any mechanic's lien enforcement action with respect to any mechanic's lien released by the deposit of said bond or letter of credit.
27. Any claimant may waive its right to assert a mechanic's lien against residential real property by executing a partial or full waiver of mechanic's lien rights, whether conditioned upon receipt of payment or unconditional, provided that a waiver of mechanic's lien rights shall not be deemed or interpreted to waive or release mechanic's lien rights in exchange for a payment of less than the amount claimed due at that time unless such mechanic's lien waiver is an unconditional, final mechanic's lien waiver in compliance with this section.
28. An unconditional, final lien waiver is a complete and absolute waiver of any mechanic's lien rights against the residential real property described in the mechanic's lien waiver, including any rights which might otherwise arise from remedial or additional labor, services, or materials provided to the residential real property, or which might benefit the residential real property, under either an initial agreement or a supplemental agreement entered into by the same parties prior to the execution of the unconditional, final mechanic's lien waiver.
29. An unconditional, final mechanic's lien waiver shall only be valid if it is on a form that is substantially as follows:
UNCONDITIONAL FINAL LIEN WAIVER FOR RESIDENTIAL REAL PROPERTY
Claimant (provide legal name and address of Claimant) hereby fully, finally, and unconditionally waives and releases any right to assert or enforce a mechanic's lien claim against the residential real property identified below for all work performed by Claimant prior to the date set forth below and for any work hereafter performed by or on behalf of Claimant under any agreements executed by Claimant prior to said date set forth below:
(Provide legal description of the Property)
Claimant's legal name and the name, title or position, address, and telephone number of the person executing the unconditional final lien waiver on behalf of claimant shall be typed or legibly printed immediately above or below the signature, and the date that the document was signed shall be typed or legibly printed immediately adjacent to the signature.
30. A claimant executing an unconditional, final mechanic's lien waiver for less than full consideration shall be bound by such mechanic's lien waiver as it relates to any rights to assert a mechanic's lien against the property, but such mechanic's lien waiver shall not constitute a waiver or release of any other claim, remedy, or cause of action.
31. An unconditional, final mechanic's lien waiver meeting the requirements of this section is valid and enforceable as to claimant's mechanic's lien rights as to the property identified on the unconditional, final mechanic's lien waiver notwithstanding claimant's failure to receive any promised payment or other consideration.
32. Any claimant who has recorded a notice of rights and who has been paid in full for the work performed on the property shall timely execute an unconditional, final mechanic's lien waiver, shall not unreasonably withhold such a waiver when circumstances require prompt execution, and in no event shall fail to provide a waiver any later than five calendar days after claimant's receipt of a written request to do so by any person or entity. A claimant who fails or refuses timely to execute an unconditional, final lien waiver when such claimant has been paid in full for any labor, materials, services, or equipment supplied or used in the improvement to the property shall be presumed liable for slander of title and for any damages sustained as a result thereof, together with a statutory penalty of five hundred dollars.
33. The provisions of this section shall not apply to a residential structure which was substantially completed prior to September 1, 2010. Notwithstanding the provisions of subsection 3 of this section, a notice of rights recorded on or prior to October 1, 2010, shall apply to all labor, material, services, or equipment supplied or used at any time in the improvement to any residential real property which was not substantially completed prior to September 1, 2010, and the provisions of subsection 7 shall only apply to a conveyance of property occurring after October 1, 2010.
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