Bill Text: IA HF675 | 2011-2012 | 84th General Assembly | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: A bill for an act concerning mechanics' liens including the establishment of a state construction registry for residential construction property, and including effective date and applicability provisions. Effective 1-1-13.

Spectrum: Committee Bill

Status: (Passed) 2012-04-27 - Signed by Governor. H.J. 894. [HF675 Detail]

Download: Iowa-2011-HF675-Amended.html
House File 675 - Reprinted HOUSE FILE 675 BY COMMITTEE ON WAYS AND MEANS (SUCCESSOR TO HF 633) (SUCCESSOR TO HF 262) (As Amended and Passed by the House April 13, 2011 ) A BILL FOR An Act concerning mechanics’ liens including the establishment 1 of a state construction registry for residential 2 construction property, and including effective date and 3 applicability provisions. 4 BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF IOWA: 5 HF 675 (6) 84 rh/nh/mb
H.F. 675 Section 1. Section 207.23, subsection 1, Code 2011, is 1 amended to read as follows: 2 1. Within six months after the completion of a project to 3 restore, reclaim, abate, control, or prevent adverse effects 4 of past coal mining practices on privately owned land, the 5 division shall itemize the money expended on the project and 6 may file a lien statement in the manner provided in section 7 572.8 in the office of the district court clerk of each county 8 in which a portion of the property affected by the project is 9 located, together with a notarized appraisal by an independent 10 appraiser of the value of the land before the restoration, 11 reclamation, abatement, control, or prevention of adverse 12 effects of past mining practices if the money so expended 13 results in a significant increase in property value. A copy 14 of the lien statement and the appraisal, if required, shall be 15 served upon affected property owners in the manner provided 16 for service of an original notice. The lien shall not exceed 17 the amount determined by the appraiser to be the increase in 18 the market value of the land as a result of the restoration, 19 reclamation, abatement, control, or prevention of adverse 20 effects of past coal mining practices. A lien shall not be 21 filed in accordance with this subsection against the property 22 of a person who owned the surface prior to May 2, 1977, and who 23 neither consented to, participated in, nor exercised control 24 over the mining operation which necessitated the reclamation 25 performed. 26 Sec. 2. Section 572.1, Code 2011, is amended to read as 27 follows: 28 572.1 Definitions and rules of construction. 29 For the purpose of this chapter : 30 1. “Administrator” means the secretary of state. 31 1. 2. “Building” shall be construed as if followed by the 32 words “erection, or other improvement upon land”. 33 3. “General contractor” includes every person who does work 34 or furnishes materials by contract, express or implied, with an 35 -1- HF 675 (6) 84 rh/nh/mb 1/ 20
H.F. 675 owner. “General contractor” does not include a person who does 1 work or furnishes materials on contract with an owner-builder. 2 2. 4. “Labor” means labor completed by the claimant. 3 3. 5. “Material” shall , in addition to its ordinary 4 meaning, include includes machinery, tools, fixtures, trees, 5 evergreens, vines, plants, shrubs, tubers, bulbs, hedges, 6 bushes, sod, soil, dirt, mulch, peat, fertilizer, fence wire, 7 fence material, fence posts, tile, and the use of forms, 8 accessories, and equipment furnished by the claimant. 9 4. 6. “Owner” means the record legal or equitable 10 titleholder and every person for whose use or benefit any 11 building, erection, or other improvement is made, having the 12 capacity to contract, including guardians of record . 13 5. “Owner-occupied dwelling” means the homestead of an 14 owner, as defined in section 561.1 , and without respect to the 15 value limitations in section 561.3 , and actually occupied by 16 the owner or the spouse of the owner, or both. “Owner-occupied 17 dwelling” includes a newly constructed dwelling to be occupied 18 by the owner as a homestead, or a dwelling that is under 19 construction and being built by or for an owner who will occupy 20 the dwelling as a homestead. 21 7. “Owner-builder” means the legal or equitable titleholder 22 of record who furnishes material for or performs labor upon a 23 building, erection, or other improvement, or who contracts with 24 a subcontractor to furnish material for or perform labor upon 25 a building, erection, or other improvement and who offers or 26 intends to offer to sell the owner-builder’s property without 27 occupying or using the structures, properties, developments, 28 or improvements for a period of more than one year from the 29 date the structure, property, development, or improvement is 30 substantially completed or abandoned. 31 8. “Residential construction” means construction on 32 single-family or two-family dwellings occupied or used, or 33 intended to be occupied or used, primarily for residential 34 purposes, and includes real property pursuant to chapter 499B. 35 -2- HF 675 (6) 84 rh/nh/mb 2/ 20
H.F. 675 9. “State construction registry” means a centralized 1 computer database maintained on the internet by the 2 administrator that provides a central repository for the 3 submission and management of preliminary notices, notices of 4 commencement of work on residential construction properties, 5 and mechanics’ liens on all construction properties. 6 10. “State construction registry number” means a number 7 provided by the administrator for all residential construction 8 properties posted to the state construction registry. 9 6. 11. “Subcontractor” shall include includes every person 10 furnishing material or performing labor upon any building, 11 erection, or other improvement, except those having contracts 12 directly with the owner. “Subcontractor” shall include those 13 persons having contracts directly with an owner-builder. 14 Sec. 3. Section 572.2, Code 2011, is amended to read as 15 follows: 16 572.2 Persons entitled to lien. 17 1. Every person who shall furnish furnishes any material 18 or labor for, or perform performs any labor upon, any building 19 or land for improvement, alteration, or repair thereof, 20 including those engaged in the construction or repair of any 21 work of internal or external improvement, and those engaged 22 in grading, sodding, installing nursery stock, landscaping, 23 sidewalk building, fencing on any land or lot, by virtue of any 24 contract with the owner, owner-builder, general contractor, 25 or subcontractor shall have a lien upon such building or 26 improvement, and land belonging to the owner on which the same 27 is situated or upon the land or lot so graded, landscaped, 28 fenced, or otherwise improved, altered, or repaired, to secure 29 payment for the material or labor furnished or labor performed. 30 2. If material is rented by a person to the owner, general 31 contractor, or subcontractor, the person shall have a lien 32 upon such building, improvement, or land to secure payment for 33 the material rental. The lien is for the reasonable rental 34 value during the period of actual use of the material and any 35 -3- HF 675 (6) 84 rh/nh/mb 3/ 20
H.F. 675 reasonable periods of nonuse of the material taken into account 1 in the rental agreement. The delivery of material to such 2 building, improvement, or land, whether or not delivery is made 3 by the person, creates a presumption that the material was 4 used in the course of alteration, construction, or repair of 5 the building, improvement, or land. However, this presumption 6 shall not pertain to recoveries sought under a surety bond. 7 3. An owner-builder is not entitled to a lien under 8 this chapter as to work the owner-builder performs, or is 9 contractually obligated to perform, prior to transferring title 10 to the buyer. 11 Sec. 4. Section 572.8, Code 2011, is amended to read as 12 follows: 13 572.8 Perfection of lien. 14 1. A person shall perfect a mechanic’s lien by filing with 15 the clerk of the district court of the county in which the 16 building, land, or improvement to be charged with the lien is 17 situated posting to the state construction registry internet 18 website a verified statement of account of the demand due the 19 person, after allowing all credits, setting forth: 20 a. The date when such material was first furnished or labor 21 first performed, and the date on which the last of the material 22 was furnished or the last of the labor was performed. 23 b. The legal description of the property to be charged with 24 the lien. 25 c. The name and last known mailing address of the owner of 26 the property. 27 d. The address of the property or a description of the 28 location of the property if the property cannot be reasonably 29 identified by an address. 30 e. The tax parcel identification number. 31 2. Upon the filing posting of the lien, the clerk of court 32 administrator shall mail a copy of the lien to the owner. If 33 the statement of the lien consists of more than one page, the 34 clerk administrator may omit such pages as consist solely of an 35 -4- HF 675 (6) 84 rh/nh/mb 4/ 20
H.F. 675 accounting of the material furnished or labor performed. In 1 this case, the clerk administrator shall attach a notification 2 that pages of accounting were omitted and may be inspected in 3 the clerk’s office on the state construction registry internet 4 website . 5 3. A lien perfected under this section shall be limited to 6 the county in which the building, land, or improvement to be 7 charged with the lien is situated. 8 Sec. 5. Section 572.9, Code 2011, is amended to read as 9 follows: 10 572.9 Time of filing lien posting . 11 The statement of account required by section 572.8 shall be 12 filed posted by a principal general contractor or subcontractor 13 within two years and ninety days after the date on which the 14 last of the material was furnished or the last of the labor was 15 performed. 16 Sec. 6. Section 572.10, Code 2011, is amended to read as 17 follows: 18 572.10 Perfecting lien after lapse of ninety days. 19 A general contractor or a subcontractor may perfect a 20 mechanic’s lien pursuant to section 572.8 beyond ninety days 21 after the date on which the last of the material was furnished 22 or the last of the labor was performed by filing a claim with 23 the clerk of the district court posting a lien to the state 24 construction registry internet website and giving written 25 notice thereof to the owner. Such notice may be served by 26 any person in the manner original notices are required to be 27 served. If the party to be served is out of the county wherein 28 the property is situated, a return of that fact by the person 29 charged with making such service shall constitute sufficient 30 service from and after the time it was filed with the clerk of 31 the district court posted to the state construction registry 32 internet website . 33 Sec. 7. Section 572.11, Code 2011, is amended to read as 34 follows: 35 -5- HF 675 (6) 84 rh/nh/mb 5/ 20
H.F. 675 572.11 Extent of lien filed posted after ninety days. 1 Liens perfected under section 572.10 shall be enforced 2 against the property or upon the bond, if given, by the owner 3 or by the owner-builder’s buyer , only to the extent of the 4 balance due from the owner to the general contractor or from 5 the owner-builder’s buyer to the owner-builder at the time of 6 the service of such notice; but if the bond was given by the 7 general contractor or owner-builder , or person contracting with 8 the subcontractor filing the claim for a lien, such bond shall 9 be enforced to the full extent of the amount found due the 10 subcontractor. 11 Sec. 8. Section 572.13, Code 2011, is amended by striking 12 the section and inserting in lieu thereof the following: 13 572.13 General contractor —— owner notice —— residential 14 construction. 15 1. A general contractor who has contracted or will contract 16 with a subcontractor to provide labor or furnish material for 17 the property shall provide the owner with the following owner 18 notice in writing in boldface type of a minimum size of ten 19 points: 20 “Persons or companies furnishing labor or materials for 21 the improvement of real property may enforce a lien upon the 22 improved property if they are not paid for their contributions, 23 even if the parties have no direct contractual relationship 24 with the owner. The state construction registry provides 25 a listing of all persons or companies furnishing labor or 26 materials who have posted a lien or who may post a lien upon 27 the improved property. If the person or company has posted its 28 notice or lien to the state construction registry, you may be 29 required to pay the person or company even if you have paid the 30 general contractor the full amount due. Therefore, check the 31 state construction registry internet website for information 32 about the property including persons or companies furnishing 33 labor or materials before paying your general contractor. In 34 addition, when making payment to your general contractor, it is 35 -6- HF 675 (6) 84 rh/nh/mb 6/ 20
H.F. 675 important to obtain lien waivers from your general contractor 1 and from persons or companies furnishing labor or materials 2 to your property. The information in the state construction 3 registry is posted on the internet website of the state 4 construction registry.” 5 2. The notice described in subsection 1 shall also contain 6 the internet website address and toll-free telephone number of 7 the state construction registry. 8 3. A general contractor who fails to provide notice pursuant 9 to this section is not entitled to a lien and remedy provided 10 by this chapter. 11 4. This section applies only to residential construction 12 properties. 13 Sec. 9. NEW SECTION . 572.13A Notice of commencement of work 14 —— general contractor —— owner-builder. 15 1. A general contractor or owner-builder who has contracted 16 or will contract with a subcontractor to provide labor or 17 furnish material for the property shall post a notice of 18 commencement of work to the state construction registry 19 internet website within ten days of commencement of work on 20 the property. A notice of commencement of work is effective 21 only as to any labor, service, equipment, or material furnished 22 to the property subsequent to the posting of the notice of 23 commencement of work. A notice of commencement of work shall 24 include all of the following information: 25 a. The name and address of the owner. 26 b. The name, address, and telephone number of the general 27 contractor or owner-builder. 28 c. The address of the property or a description of the 29 location of the property if the property cannot be reasonably 30 identified by an address. 31 d. The legal description of the property. 32 e. The date work commenced. 33 f. The tax parcel identification number. 34 g. Any other information prescribed by the administrator 35 -7- HF 675 (6) 84 rh/nh/mb 7/ 20
H.F. 675 pursuant to rule. 1 2. If a general contractor or owner-builder fails to post 2 the required notice of commencement of work to the state 3 construction registry internet website pursuant to subsection 4 1, within ten days of commencement of the work on the property, 5 a subcontractor may post the notice in conjunction with the 6 filing of the required preliminary notice pursuant to section 7 572.13B. A notice of commencement of work must be posted to the 8 state construction registry internet website before preliminary 9 notices pursuant to section 572.13B may be posted. 10 3. At the time a notice of commencement of work is posted 11 on the state construction registry internet website, the 12 administrator shall assign a state construction registry number 13 and send a copy of the owner notice described in section 572.13 14 along with other relevant information to the owner and to the 15 property address, addressed to “owner”, as prescribed by the 16 administrator pursuant to rule. 17 4. A general contractor who fails to provide notice pursuant 18 to this section is not entitled to a lien and remedy provided 19 by this chapter. 20 5. This section applies only to residential construction 21 properties. 22 Sec. 10. NEW SECTION . 572.13B Preliminary notice —— 23 subcontractor —— residential construction. 24 1. A subcontractor shall post a preliminary notice to the 25 state construction registry internet website. A preliminary 26 notice posted before the balance due is paid to the general 27 contractor or the owner-builder is effective as to all labor, 28 service, equipment, and material furnished to the property by 29 the subcontractor. The preliminary notice shall contain all 30 of the following information: 31 a. The name of the owner. 32 b. The state construction registry number. 33 c. The name, address, and telephone number of the 34 subcontractor furnishing the labor, service, equipment, or 35 -8- HF 675 (6) 84 rh/nh/mb 8/ 20
H.F. 675 material. 1 d. The name and address of the person who contracted 2 with the claimant for the furnishing of the labor, service, 3 equipment, or material. 4 e. The name of the general contractor or owner-builder under 5 which the claimant is performing or will perform the work. 6 f. The address of the property or a description of the 7 location of the property if the property cannot be reasonably 8 identified by an address. 9 g. The legal description of the property. 10 h. The date the material or materials were first furnished 11 or the labor was first performed. 12 i. The tax parcel identification number. 13 j. Any other information required by the administrator 14 pursuant to rule. 15 2. At the time a preliminary notice is posted to the 16 state construction registry, the administrator shall send 17 notification to the owner, including the owner notice described 18 in section 572.13, subsection 1, and shall docket the mailing 19 of the notice on the state construction registry as prescribed 20 by the administrator pursuant to rule. Notices under this 21 section shall not be sent to owner-builders. Upon request, the 22 administrator shall provide an affidavit of mailing at no cost 23 for the notice required under this section. 24 3. a. A mechanic’s lien perfected under this chapter 25 is enforceable only to the extent of the balance due the 26 general contractor or the owner-builder at the time of the 27 posting of the preliminary notice specified in subsection 1, 28 and, except for residential construction property owned by 29 an owner-builder, also is enforceable only to the extent of 30 the balance due the general contractor at the time the owner 31 actually receives the notice provided pursuant to subsection 2 32 or paragraph “b” . 33 b. (1) In any action to enforce a mechanic’s lien perfected 34 under this chapter against the owner, the subcontractor 35 -9- HF 675 (6) 84 rh/nh/mb 9/ 20
H.F. 675 bears the burden to prove by a preponderance of the evidence 1 that the owner received notice pursuant to subsection 2. A 2 subcontractor may satisfy the burden of proof by providing 3 separate notice to an owner by including but not limited to any 4 of the following means: 5 (a) By certified mail with return receipt. 6 (b) By personal service in the manner original notices are 7 required to be served. 8 (c) By actual notice with a signed receipt from the owner 9 acknowledging notice. 10 (2) If the subcontractor provides an affidavit of mailing, 11 the presumption is that the owner received the notice on the 12 fourth day of business for the post office after the notice was 13 sent and the burden of proof shifts from the subcontractor to 14 the owner to refute the presumption. 15 4. A subcontractor who fails to post a preliminary notice 16 pursuant to this section shall not be entitled to a lien and 17 remedy provided under this chapter. 18 5. This section applies only to residential construction 19 properties. 20 Sec. 11. Section 572.14, Code 2011, is amended by striking 21 the section and inserting in lieu thereof the following: 22 572.14 Liability to subcontractor after payment to general 23 contractor or owner-builder. 24 Except as provided in section 572.13B, payment to the 25 general contractor or owner-builder of any part or all of 26 the contract price of the building or improvement within 27 ninety days after the date on which the last of the materials 28 was furnished or the last of the labor was performed by a 29 subcontractor, does not relieve the owner from liability to the 30 subcontractor for the full value of any material furnished or 31 labor performed upon the building, land, or improvement if the 32 subcontractor posts a lien within ninety days after the date 33 on which the last of the materials was furnished or the last of 34 the labor was performed. 35 -10- HF 675 (6) 84 rh/nh/mb 10/ 20
H.F. 675 Sec. 12. Section 572.15, Code 2011, is amended to read as 1 follows: 2 572.15 Discharge of subcontractor’s mechanic’s lien —— bond. 3 A mechanic’s lien may be discharged at any time by the owner, 4 principal contractor, or intermediate subcontractor filing with 5 the clerk of the district court of the county in which the 6 property is located submitting a bond to the administrator in 7 twice the amount of the sum for which the claim for the lien 8 is filed, with surety or sureties, to be approved by the clerk 9 administrator , conditioned for the payment of any sum for which 10 the claimant may obtain judgment upon the claim. 11 Sec. 13. Section 572.16, Code 2011, is amended to read as 12 follows: 13 572.16 Rule of construction. 14 Nothing in this chapter shall be construed to require the 15 owner to pay a greater amount or at an earlier date than is 16 provided in the owner’s contract with the principal general 17 contractor, unless said the owner pays a part or all of the 18 contract price to the original general contractor before the 19 expiration of the ninety days allowed by law for the filing 20 posting of a mechanic’s lien by a subcontractor; provided 21 that in the case of an owner-occupied dwelling residential 22 construction , nothing in this chapter shall be construed to 23 require the owner to pay a greater amount or at an earlier date 24 than is provided in the owner’s contract with the principal 25 general contractor, unless the owner pays a part or all of 26 the contract price to the principal general contractor after 27 receipt of notice under section 572.14, subsection 2 the owner 28 receives notice pursuant to section 572.13B, subsection 2 or 29 subsection 3, paragraph “b” . 30 Sec. 14. Section 572.17, Code 2011, is amended to read as 31 follows: 32 572.17 Priority of mechanics’ liens between mechanics. 33 Mechanics’ liens shall have priority over each other in the 34 order of the filing posting of the statements or of accounts as 35 -11- HF 675 (6) 84 rh/nh/mb 11/ 20
H.F. 675 herein provided in section 572.8 . 1 Sec. 15. Section 572.18, subsections 1 and 3, Code 2011, are 2 amended to read as follows: 3 1. Mechanics’ liens filed posted by a principal general 4 contractor or subcontractor within ninety days after the date 5 on which the last of the material was furnished or the last 6 of the claimant’s labor was performed and for which notices 7 were properly posted to the state construction registry 8 internet website pursuant to sections 572.13A and 572.13B 9 shall be superior to all other liens which may attach to or 10 upon a building or improvement and to the land upon which it 11 is situated, except liens of record prior to the time of the 12 original commencement of the claimant’s work or the claimant’s 13 improvements, except as provided in subsection 2 . 14 3. The rights of purchasers, encumbrancers, and other 15 persons who acquire interests in good faith, for a valuable 16 consideration, and without notice of a lien perfected pursuant 17 to this chapter , are superior to the claims of all general 18 contractors or subcontractors who have perfected their liens 19 more than ninety days after the date on which the last of the 20 claimant’s material was furnished or the last of the claimant’s 21 labor was performed. 22 Sec. 16. Section 572.22, Code 2011, is amended to read as 23 follows: 24 572.22 Record of claim. 25 The clerk of the court administrator shall endorse upon 26 every claim for a mechanic’s lien filed in the clerk’s office 27 posted to the state construction registry internet website the 28 date and hour of filing posting and make an abstract thereof in 29 the mechanic’s lien book kept for that purpose . Said book Each 30 claim shall be properly indexed and shall contain the following 31 items concerning each claim : 32 1. The name of the person by whom filed posted . 33 2. The date and hour of filing posting . 34 3. The amount thereof. 35 -12- HF 675 (6) 84 rh/nh/mb 12/ 20
H.F. 675 4. The name of the person against whom filed posted . 1 5. The legal description of the property to be charged 2 therewith . 3 6. The tax parcel identification number of the property to 4 be charged. 5 7. The address of the property or a description of the 6 location of the property if the property cannot be reasonably 7 identified by an address. 8 Sec. 17. Section 572.23, Code 2011, is amended to read as 9 follows: 10 572.23 Acknowledgment of satisfaction of claim. 11 1. When a mechanic’s lien is satisfied by payment of the 12 claim, the claimant shall acknowledge satisfaction thereof upon 13 the mechanic’s lien book, or otherwise in writing, and, if the 14 claimant neglects to do so for thirty days after demand in 15 writing is personally served upon the claimant, the claimant 16 shall forfeit and pay twenty-five dollars to the owner or , 17 general contractor, or owner-builder and be liable to any 18 person injured to the extent of the injury. 19 2. If acknowledgment of satisfaction is not filed 20 acknowledged within thirty days after service of the demand in 21 writing, the party serving the demand or causing the demand to 22 be served may file for record with the clerk of the district 23 court administrator a copy of the demand with proofs of service 24 attached and endorsed and, in case of service by publication, 25 a personal affidavit that personal service could not be made 26 within this state. Upon completion of the requirements of this 27 subsection , the record shall be constructive notice to all 28 parties of the due forfeiture and cancellation of the lien. 29 Upon the filing of the demand with the required attachments, 30 the clerk of the district court administrator shall mail a 31 file-stamped date-stamped copy of the demand to both parties. 32 Sec. 18. Section 572.24, subsection 2, Code 2011, is amended 33 to read as follows: 34 2. An action to challenge a mechanic’s lien may be 35 -13- HF 675 (6) 84 rh/nh/mb 13/ 20
H.F. 675 commenced in the district court or small claims court if the 1 amount of the lien is within jurisdictional limits. Any 2 permissible claim or counterclaim meeting subject matter and 3 jurisdictional requirements may be joined with the action. 4 The court shall make written findings regarding the lawful 5 amount and the validity of the mechanic’s lien. In addition 6 to any other appropriate order, the court may enter judgment 7 on a permissibly joined claim or counterclaim. If the court 8 determines that the mechanic’s lien is invalid, valid for a 9 lesser amount, frivolous, fraudulent, forfeited, expired, or 10 for any other reason unenforceable, the clerk of the district 11 court shall make an entry of record to the mechanic’s lien book 12 submit the ruling to the administrator who shall make a posting 13 to the state construction registry internet website regarding 14 the proper amount of the lien or, if warranted, canceling the 15 lien. 16 Sec. 19. Section 572.28, subsection 2, Code 2011, is amended 17 to read as follows: 18 2. If an action is not filed within thirty days after 19 demand to commence action is served, the party serving the 20 demand or causing the demand to be served may file for record 21 post with the clerk of the district court administrator a copy 22 of the demand with proofs of service attached and endorsed 23 and, in case of service by publication, a personal affidavit 24 that personal service could not be made within this state. 25 Upon completion of the requirements of this subsection , the 26 record shall be constructive notice to all parties of the due 27 forfeiture and cancellation of the lien. Upon the filing 28 posting of the demand with the required attachments, the clerk 29 of the district court administrator shall mail a file-stamped 30 date-stamped copy of the demand to both parties. 31 Sec. 20. Section 572.30, Code 2011, is amended to read as 32 follows: 33 572.30 Action by subcontractor or owner against general 34 contractor or owner-builder . 35 -14- HF 675 (6) 84 rh/nh/mb 14/ 20
H.F. 675 Unless otherwise agreed, a principal general contractor 1 or owner-builder who engages a subcontractor to supply 2 labor or materials or both for improvements, alterations or 3 repairs to a specific owner-occupied dwelling residential 4 construction property shall pay the subcontractor in full for 5 all labor and materials supplied within thirty days after 6 the date the principal general contractor or owner-builder 7 receives full payment from the owner. If a principal general 8 contractor or owner-builder fails without due cause to pay a 9 subcontractor as required by this section , the subcontractor, 10 or the owner by subrogation, may commence an action against 11 the general contractor or owner-builder to recover the amount 12 due. Prior to commencing an action to recover the amount 13 due, a subcontractor, or the owner by subrogation, shall give 14 notice of nonpayment of the cost of labor or materials to 15 the principal general contractor or owner-builder paid for 16 the improvement. Notice of nonpayment must be in writing, 17 delivered in a reasonable manner, and in terms that reasonably 18 identify the real estate improved and the nonpayment complained 19 of. In an action to recover the amount due a subcontractor, 20 or the owner by subrogation, under this section , the court 21 in addition to actual damages, shall award a successful 22 plaintiff exemplary damages against the general contractor 23 or owner-builder in an amount not less than one percent 24 and not exceeding fifteen percent of the amount due the 25 subcontractor, or the owner by subrogation, for the labor and 26 materials supplied, unless the principal general contractor or 27 owner-builder does one or both of the following, in which case 28 no exemplary damages shall be awarded: 29 1. Establishes that all proceeds received from the person 30 making the payment have been applied to the cost of labor or 31 material furnished for the improvement. 32 2. Within fifteen days after receiving notice of nonpayment 33 the principal general contractor or owner-builder gives a 34 bond or makes a deposit with the clerk of the district court 35 -15- HF 675 (6) 84 rh/nh/mb 15/ 20
H.F. 675 administrator , in an amount not less than the amount necessary 1 to satisfy the nonpayment for which notice has been given 2 under this section , and in a form approved by a judge of the 3 district court, to hold harmless the owner or person having 4 the improvement made from any claim for payment of anyone 5 furnishing labor or material for the improvement, other than 6 the principal general contractor or owner-builder . 7 Sec. 21. Section 572.31, Code 2011, is amended to read as 8 follows: 9 572.31 Cooperative and condominium housing. 10 A lien arising under this chapter as a result of the 11 construction of an apartment house or apartment building which 12 is owned on a cooperative basis under chapter 499A , or which is 13 submitted to a horizontal property regime under chapter 499B , 14 is not enforceable, notwithstanding any contrary provision 15 of this chapter , as against the interests of an owner in an 16 owner-occupied dwelling a unit contained in the apartment 17 house or apartment building acquired in good faith and for 18 valuable consideration, unless a lien statement specifically 19 describing the dwelling unit is filed under section 572.8 20 within the applicable time period specified in section 572.9 , 21 but determined from the date on which the last of the material 22 was supplied or the last of the labor was performed in the 23 construction of that dwelling unit. 24 Sec. 22. Section 572.32, Code 2011, is amended to read as 25 follows: 26 572.32 Attorney fees —— remedies. 27 1. In a court action to enforce a mechanic’s lien, if 28 the plaintiff furnished labor or materials directly to the 29 defendant, a prevailing plaintiff may be awarded reasonable 30 attorney fees. 31 2. In a court action to challenge a mechanic’s lien filed 32 posted on an owner-occupied dwelling a residential construction 33 property , if the person challenging the lien prevails, the 34 court may award reasonable attorney fees and actual damages. 35 -16- HF 675 (6) 84 rh/nh/mb 16/ 20
H.F. 675 If the court determines that the mechanic’s lien was filed 1 posted in bad faith or the supporting affidavit was materially 2 false, the court shall award the owner reasonable attorney fees 3 plus an amount not less than five hundred dollars or the amount 4 of the lien, whichever is less. 5 Sec. 23. Section 572.33, Code 2011, is amended to read as 6 follows: 7 572.33 Requirement of notification for commercial 8 construction . 9 1. The notification requirements in this section apply only 10 to commercial construction. 11 1. 2. A person furnishing labor or materials to a 12 subcontractor shall not be entitled to a lien under this 13 chapter unless the person furnishing labor or materials does 14 all of the following: 15 a. Notifies the principal general contractor or 16 owner-builder in writing with a one-time notice containing 17 the name, mailing address, and telephone number of the 18 person furnishing the labor or materials, and the name of the 19 subcontractor to whom the labor or materials were furnished, 20 within thirty days of first furnishing labor or materials for 21 which a lien claim may be made. Additional labor or materials 22 furnished by the same person to the same subcontractor for 23 use in the same construction project shall be covered by this 24 notice. 25 b. Supports the lien claim with a certified statement that 26 the principal general contractor or owner-builder was notified 27 in writing with a one-time notice containing the name, mailing 28 address, and telephone number of the person furnishing the 29 labor or materials, and the name of the subcontractor to whom 30 the labor or materials were furnished, within thirty days 31 after the labor or materials were first furnished, pursuant to 32 paragraph “a” . 33 2. This section shall not apply to a mechanic’s lien on 34 single-family or two-family dwellings occupied or used or 35 -17- HF 675 (6) 84 rh/nh/mb 17/ 20
H.F. 675 intended to be occupied or used for residential purposes. 1 3. Notwithstanding other provisions of this chapter , a 2 principal general contractor or owner-builder shall not be 3 prohibited from requesting information from a subcontractor 4 or a person furnishing labor or materials to a subcontractor 5 regarding payments made or payments to be made to a person 6 furnishing labor or materials to a subcontractor. 7 Sec. 24. NEW SECTION . 572.33A Liability of owner to general 8 contractor —— commercial construction. 9 An owner of a building, land, or improvement upon which 10 a mechanic’s lien of a subcontractor may be filed, is not 11 required to pay the general contractor for compensation for 12 work done or material furnished for the building, land, or 13 improvement until the expiration of ninety days after the 14 completion of the building or improvement unless the general 15 contractor furnishes to the owner one of the following: 16 1. Receipts and waivers of claims for mechanics’ liens, 17 signed by all persons who furnished material or performed labor 18 for the building, land, or improvement. 19 2. A good and sufficient bond to be approved by the owner, 20 conditioned that the owner shall be held harmless from any 21 loss which the owner may sustain by reason of the filing of 22 mechanics’ liens by subcontractors. 23 Sec. 25. NEW SECTION . 572.34 State construction registry 24 —— residential construction. 25 1. A state construction registry is created and shall be 26 administered by the administrator. The administrator shall 27 adopt rules pursuant to chapter 17A for the creation and 28 administration of the registry. 29 2. The state construction registry shall be accessible 30 to the general public through the administrator’s internet 31 website. 32 3. The registry shall be indexed by owner name, general 33 contractor name, state construction registry number, property 34 address, legal description, tax parcel identification number, 35 -18- HF 675 (6) 84 rh/nh/mb 18/ 20
H.F. 675 and any other identifier considered appropriate as determined 1 by the administrator pursuant to rule. 2 4. A general contractor, owner-builder, or subcontractor 3 who posts fictitious, forged, or false information to the 4 state construction registry shall be subject to a penalty as 5 determined by the administrator by rule in addition to all 6 other penalties and remedies available under applicable law. 7 5. A person may post a correction statement with respect to 8 a record indexed in the state construction registry internet 9 website if the person believes the record is inaccurate or 10 wrongfully posted. 11 6. The administrator shall charge and collect fees as 12 established by rule necessary for the administration and 13 maintenance of the registry and the registry’s internet 14 website. The administrator shall not charge a filing fee for 15 a preliminary notice required pursuant to this chapter that 16 exceeds the cost of sending such notice by certified mail with 17 restricted delivery and return receipt. The administrator 18 shall not charge a filing fee for a mechanics’ lien that 19 exceeds forty dollars. 20 7. Notices may be posted to the state construction registry 21 electronically on the administrator’s internet website, or 22 may be sent to the administrator for posting by United States 23 mail or facsimile transmission, or other alternate method 24 as provided by the administrator pursuant to rule. Notices 25 received by United States mail or facsimile transmission shall 26 be posted by the administrator to the state construction 27 registry within three business days of receipt. 28 8. Mechanics’ liens may be posted to the state construction 29 registry electronically on the administrator’s internet website 30 or may be sent to the administrator for posting by United 31 States mail. Liens received by United States mail shall be 32 posted by the administrator to the state construction registry 33 within three business days of receipt. 34 9. The administrator shall send a receipt acknowledging a 35 -19- HF 675 (6) 84 rh/nh/mb 19/ 20
H.F. 675 notice or lien submitted by United States mail or facsimile 1 transmission, as provided by the administrator by rule. 2 10. Information collected by and furnished to the 3 administrator in conjunction with the submission and posting 4 of notices pursuant to sections 572.13A and 572.13B shall be 5 used by the administrator solely for the purposes of the state 6 construction registry. 7 11. Registration under chapter 91C shall not be required in 8 order to post a notice or a lien under this chapter. 9 Sec. 26. Section 602.8102, subsection 82, Code 2011, is 10 amended to read as follows: 11 82. Carry out duties relating to liens as provided in 12 chapters 249A , 572 , 574 , 580 , 582 , and 584 . 13 Sec. 27. EFFECTIVE DATE AND APPLICABILITY. 14 1. This Act takes effect July 1, 2012. 15 2. Mechanic’s liens filed prior to the effective date of 16 this Act shall remain with the clerk of the district court of 17 the county in which the building, land, or improvement charged 18 with the lien is situated. 19 3. The notice provisions contained in this Act apply only 20 to material furnished or labor performed after the effective 21 date of this Act. 22 -20- HF 675 (6) 84 rh/nh/mb 20/ 20
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