All About Alaska Mechanic’s Liens and Bond Claims
I’ll admit, I know very little about Alaska. Juneau is the capital, there’s a folk song titled Anchorage, and on a clear day you may be able to see Russia. But something I know very well? Mechanic’s lien and bond claim rights! In this post I will review the statutory requirements for securing lien and bond claim rights for projects in Alaska.
Alaska | Private Projects and the Notice of Right to Lien
For those furnishing to private projects in Alaska, a Notice of Right to Lien may be served upon the owner or the owner’s agent prior to furnishing. The Notice of Right to Lien obligates the owner to provide notice before filing a notice of completion and places a burden of proof on the owner to show that they did not know of or consent to the furnishing of materials or services.
The Notice of Right to Lien may be recorded any time after entering into a contract or first furnishing, but within 15 days from the recording of a notice of completion. Recording the notice prevents the owner from shortening the period in which the lien must be filed. The owner, lender or prime contractor may request an accounting of the amount due and a description of materials and services provided, in response to the Notice of Right to Lien. If a party makes this request, you must respond within 5 days.
Alaska | Private Projects Lien & Suit
A mechanic’s lien should be filed within 120 days from last furnishing and within 15 days from the filing of a notice of completion. The filing of a notice of completion will not shorten the lien deadline if a Notice of Right to Lien was served, but the owner failed to provide notice of the filing of the notice of completion, or if a Notice of Right to Lien was recorded.
If you need to enforce your lien claim, you should file suit within 6 months from the filing of the lien. An extension to file suit can be filed within 6 months from filing the lien, extending the deadline for suit to enforce the lien to 6 months from filing the extension.
Alaska | Private Projects and the Stop-Lending Notice
In addition to mechanic’s lien rights, a stop-lending notice may be an available remedy on private projects. Just as with mechanic’s lien rights, a Notice of Right to Lien may be served upon the owner or the owner’s agent and the lender prior to furnishing materials or services. Serving the notice is not a prerequisite to serving a stop-lending notice, however, a lender receiving the notice must notify the claimant if the lender is not providing construction financing.
You should serve the stop-lending notice upon the lender, owner, and prime contractor at any time after payment is due. Once served, the lender is required to cease providing construction financing. A lender who disburses construction financing after receiving a stop-lending notice is liable to the claimant. If necessary, file suit to enforce the stop-lending notice and notify the lender of the action within 90 days from the date the lender received the stop-lending notice.
Alaska | Public Projects and the Bond Claim
Generally, there is no required preliminary notice for securing bond claim rights, though a non-statutory notice is recommended. For public projects in Alaska, a payment bond may be required for general contracts exceeding $100,000 and, under certain conditions, a municipality may exempt contractors from the requirement to obtain a bond for projects not exceeding $400,000. If a payment bond has not been issued, the public entity may withhold final payment to the general contractor until the contractor files a certification that all persons who supplied labor or materials have been paid.
If a payment bond has been supplied, serve a bond claim upon the prime contractor within 90 days from your last furnishing date. If you have contracted directly with the prime contractor, the bond claim notice is not required, but is still recommended. If needed, file suit to enforce the bond claim after 90 days from last furnishing materials or services, but within 1 year from final settlement of the contract.
“Alaska the Questions Here”
(Get it… Alaska = I’ll Aska the Questions Here… No? OK then)
There are a couple other points of interest. There are other types of liens available, including liens on dump or mass of mineral, mines and oil wells, mills and machines. Please keep in mind, these liens are separate from mechanic’s lien remedies, and may require additional title work and attorney time. Specifically, mines and oil wells often span multiple parcels, counties & even states. Additionally, liens can be bonded off. Under Sec. 34.35.072, if a lien has been filed, the property owner or contractor can record a payment bond in the amount of 1.5 times of the lien claim amount, and the property will be freed from the lien.