05/18/2010

Real Estate Alert: House Bill No. 2058

The Missouri Legislature has amended Chapter 429 RSMo. to enact new procedures for asserting mechanic’s liens against residential real property, which is defined to mean (i) improved or unimproved real property used or intended to be used for the construction of owner-occupied residential structures and related improvements including dwellings of four units or less, condominiums, townhomes and cooperatives regardless of the number of units, and mixed-use or planned unit developments, and (ii) improvements which support the residential use of land such as streets, sidewalks, utility services and common areas. The amendments do not apply to the repair or remodeling of existing, owner-occupied residential property of four units or less.

The primary focus of the amendment is to require original contractors, registered architects, registered professional engineers, registered landscape architects and registered land surveyors to record notice in the public records prior to performing work for which they intend to preserve the right to assert a mechanic’s lien. A copy of the notice must also be posted on the property and given or made accessible to all persons identified in the notice.

In addition, as a condition precedent to filing a lien, the amendment requires every subcontractor or supplier who is not accurately identified in a previously recorded notice to record and give copies or reasonable access to a notice of commencement to all persons therein identified.

The notice must contain the name and, if known, address of the owner of the property; the name, address, telephone number, e-mail address and facsimile number, if any, of the person recording the notice; the legal description of the property; and the name, address, telephone number, e-mail address and facsimile number, if known, of every person with whom the person giving the notice has contracted to provide labor, materials or services for the improvement of the property.

Any person who fails to record a notice or who is not accurately identified in a recorded notice will be deemed to have waived any rights to assert a mechanic’s lien.

The required notices must be given prior to conveyance to a bona fide third party for value, and unless extended, are effective for two years from the date of recording.

The amendment also addresses partial and final lien waivers, makes failure to file a final lien waiver or to identify the labor, materials or services provided a crime; and provides for bonding over lien claims.