A successful construction project can quickly turn frustrating if an unpaid subcontractor or supplier you’ve never even met files a mechanic’s lien against your property. Fortunately, you can take a few precautionary measures to reduce these unexpected legal risks under Minnesota real estate law.
1. Request written lien waivers
Ask for a signed lien waiver every time you make a payment to your contractor or supplier. This may help you prove that everyone received payment for their specific work if a problem arises in the future. It is important to note that the law allows the contractor or supplier to refuse to sign an unconditional lien waiver before they receive the payment.
2. Use joint check agreements
Pay with joint checks to ensure your money reaches the people doing the actual work. For instance, you can write a joint check that requires both the general contractor and the subcontractor to sign before anyone can cash it. If you monitor your payments this way, you could keep your real estate free from surprise claims.
3. Watch the pre-lien notice process
Monitor your initial written contract for the general contractor’s pre-lien notice, and watch for separate notices from subcontractors and suppliers. Under Minnesota mechanical lien law, these notices must be provided to you within 45 days after they first supply labor or materials.
Safeguard your property interests
Staying organized with these records ensures you are never surprised by a claim during the final stages of construction. This habit is a vital part of managing mechanics lien risks effectively. Consulting with a Minnesota attorney experienced in real estate law can help you create a specific plan to keep your land free from unexpected claims.