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May file notice of commencement at beginning of construction project. | Lien must be filed within 90 days of last furnishing labor and/or material. Lien must be foreclosed upon within 90 days of its recording, but may be extended each 90 days for up to 1 year. |
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Must deliver preliminary notice to owner and prime contractor. No time requirement, but notice only preserves lien rights against amounts not paid at time notice is sent. | Lien must be filed within 90 days of last furnishing labor and/or material. Lien must be foreclosed upon within 90 days of its recording, but may be extended each 90 days for up to 1 year. |
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Must deliver preliminary notice to owner and prime contractor. No time requirement, but notice only preserves lien rights against amounts not paid at time notice is sent. | Lien must be filed within 90 days of last furnishing labor and/or material. Lien must be foreclosed upon within 90 days of its recording, but may be extended each 90 days for up to 1 year. |
NOTICE REQUIREMENTS
- Preliminary notice is required for all parties except prime contractors (i.e. subs, suppliers, sub-subs). It can be provided at any time, but itʼs important to deliver it early because a partyʼs lien rights are limited to the amount of money that has not been paid to the owner (or prime) at the time the notice is delivered.
- Notice must be either personally delivered or sent by registered or
certified mail to the last known address of the person in the notice of commencement, and must contain the name of the claimant, name of party who hired claimant, general description of labor and/or materials provided, the amount unpaid (i.e. the contract total), and a statutory statement giving the proper notice. See 28 VIC §256 (e).
A Notice of Commencement may be recorded. It must be signed by the owner and contain the information required by 28 VIC §262.
THE MECHANIC’S LIEN
- Mechanic Lien must be filed within 90 days after final furnishing of materials and/or labor. Referred to as “Notice of Lien.”
- Mechanic lien must be “foreclosed upon” within 90 days of the lienʼs recording. However, the lien may be “extended” for additional 90 day periods. It cannot be extended further than 1 year from its filing.
- Mechanic liens should be recorded in the office of recorder in the district where the real estate improvement was undertaken.
- The right to file a mechanic lien is restricted if the prime contractor or owner has obtained a bond for the project. If a bond is obtained, the claimant may only file a lien for an amount due that is not covered by the bond. To file a claim against the bond, proper notice of the claim must be filed with the surety and the prime contractor within 60 days after last furnishing labor and/or materials. Suit on the claim against the bond must be initiated within 1 year after last furnishing labor and/or materials.
Frequently Asked Questions about US Virgin Islandʼs Mechanic Lien Laws:
Q: What amounts can I include in the mechanicʼs lien?
The US Virgin Island has some interesting and unique limitations on the lien amount (the dollar amount claimed in the lien).
For prime contractors, the lien is limited in the amount claimed to the “unpaid part of the prime contract price less the aggregate amount secured by the liens of all subcontractors.” 28 VIC § 256(a)
For subcontractors / suppliers, the lien is limited to the lesser of the amount unpaid under its contract, or the part of the contract price “remaining unpaid under the prime contract at the time the owner receives notification…of the subcontractorʼs right to claim the lien” and “any additional part of the prime contract price paid prior to the filing of a notice of commencement.” While this is a bit complicated, the lien amount stated in filed mechanic liens is usually the amount unpaid under the subcontract, as the other information may not be known to the claimant.
Q: Can I extend the effectiveness of a mechanicʼs lien?
Yes, you can extend the effectiveness of your mechanics lien for up to one year. However, each extension is only 90 days, and to qualify for the extension you must file an affidavit with the recorderʼs office stating that “no cause of action has accrued to [you] under the contract for which [you] recorded the notice of lien.”
