Demand for Notice of Satisfaction by Corporation
Note: This summary is not intended to be an all inclusive discussion of the District of Columbia’s construction lien laws, but does include basic provisions.
When and By Whom A Lien May Be Filed.
The Code of the District of Columbia allows a party who has supplied labor or materials for the erection, improvement, repair of, or addition to, a building to file a lien within ninety (90) days of the earlier of the completion or the termination of the work. A lien is accomplished by the filing of a Notice of Mechanic’s Lien with the Recorder of Deeds for the District of Coilumbia, and serving the Notice upon the owner. The lien shall be for the amount of the contract price or, in the absence of a contract, for the vlaue of the labor or materials provided. Additional requirements are specified by statute. See DC Code § 40-301.02(b).
Rights of the Subcontractor.
D.C. law permits a subcontractor to demand that the owner of the building being improved supply the subcontractor with a statement detaling the terms of the contract between the owner and the principal contractor, including the amount due to the contractor. Faliure or refusal to supply this information may result in the property owner being held liable for the lein of the demanding party. DC Code §40-303.05
Also, the subcontractor is required to submit the same Notice of Mechanic’s Lien as the principal contractor. If the subcontractor fails to file the Notice of Mechanic’s Lien and the owner makes payments to the principal contractor as provided in the contract, the amount the property is chargeable for the potential lien of the subcontractor is reduced by the amount of those payments. See DC Code § 40-303.03.
What is a Notice of Satisfaction?
D.C. statute requires that after a lien has been satisfied, upon the demand of the party adversely affected by the lien, that the party that filed the lien must file a Notice of Satisfaction which states that the lien has been satisfied in full and released. Failure to file the Notice after such a demand will result in a $50.00 forfieture as well as any damages that result from the lienholder’s refusal. DC Code § 40-303.15.
Mechanic’s Lien Undertaking
D.C. Code § 40-303.16 permits the owner to pay into court or submit a written undertaking, with two or more sureties, and remove the lien from the property and substitute the cash or undertaking in it’s place.
