On January 5, 2011 Governor Patrick signed a bill which for the first time provides architects, engineers and other design professionals with the right to obtain mechanics liens for unpaid fees. All design professionals working on Massachusetts private construction projects, along with anyone who uses their services, should become familiar with the provisions of this amendment to the lien law, which takes effect July 1, 2011.
Prior to this new bill, mechanics liens in Massachusetts could be obtained by anyone who provided labor, services, material or equipment on construction projects except for design professionals (“A/Es”). Under the new statute, however, A/Es can obtain mechanics liens similar to those allowed to others in the construction process, provided that they strictly comply with statutory procedures. An A/E lien can be obtained by architects, landscape architects, professional engineers, licensed site professionals and land surveyors, if they are licensed or registered in Massachusetts.
1. WHAT CAN AND CAN’T BE INCLUDED IN AN A/E LIEN
A/E liens are allowed for the value of “Professional Services,” defined as “services that are customarily and legally performed” by design professionals, including “programming, planning, surveying, site investigation, analysis, assessment, design, preparation of drawings and specifications and construction administration services.”
A/E liens can be obtained whether or not the professional services have been completed, and whether or not the project for which the services were rendered has been, or is ever, commenced or completed.
2. PROCEDURES AND REQUIREMENTS FOR A/E MECHANIC LIENS
The procedures for obtaining an A/E lien are similar to those for obtaining a contractor or subcontractor lien. The A/E must have a written contract; it must file a “Notice of Contract” within 60 days after the recording of a statutory Notice of Substantial Completion or 90 days after the last day any tier of A/E performed services; it must then file a “Statement of Account” within 30 days after the last day that a Notice of Contract may be filed; and it must begin a lawsuit on the lien claim within 90 days after the recording of the Statement of Account.
Several special requirements apply to liens filed by “second tier” A/Es (those working for other A/Es). The second tier A/E may file its own lien only if the Owner approves the lower tier A/E subcontract in writing. It must deliver a copy of the Notice of Contract directly to the Owner, and the amount of its lien is limited to the amount owed by the Owner to the first tier A/E at the time the second tier A/E records its Notice of Contract.
Similarly, an A/E working under a contractor or subcontractor (rather than under the owner or a first-tier A/E) must file its Notice of Contract within 90 days after the last day the contractor or any of its subcontractors performed work on the project (if that date is earlier than the above deadlines), and a copy must be sent to the owner. The amount of this A/E lien is limited to the amount owed by the Owner to the Contractor at the time the A/E records its Notice of Contract. In addition, A/Es who are not contracted directly with the General Contractor must serve a “Notice of Identification” within 30 days of commencing work, or the lien will be limited to the amount due to the party who hired the A/E at the time the A/E files its Notice of Contract.
3. LIMITATIONS ON A/E LIEN RIGHTS
The statute provides that most A/E liens have a lower priority than contractor, subcontractor, supplier and labor liens. If property is sold to satisfy liens, those “working” liens are therefore paid first, and A/E liens are paid only if money is available after those “working” liens are paid. Liens for A/Es hired by Contractors or Subcontractors, however, are not subject to this restriction.