Montana Bond Claim (Little Miller Act) Overview

It’s easy to file and manage your Montana bond claims with zlien, the industry’s only all-in-one bond claim and security rights management platform. Get complete control over your bond claim rights on a state, county, or municipal project, by using intelligent technology. To learn more about Montana’s bond claim laws and requirements, read the frequently asked questions below.

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Montana

Preliminary Notice Deadlines
None / not applicable.

Montana

Bond Claim Deadlines
None / not applicable.

Montana

Preliminary Notice Deadlines
30 Days

Preliminary notice to prime contractor required within 30 days of first furnishing labor, materials or services to the project.

Montana

Bond Claim Deadlines
90 Days

Must file bond claim within 90 days of the project's completion. Lawsuit to enforce due within 1 year from when the cause of action has arisen, or if the contracting agency has implemented a settlement proceed to handle claims, within 1 year from when a final decision in such procedure is published.

Montana

Preliminary Notice Deadlines
30 Days

Preliminary notice to prime contractor required within 30 days of first furnishing labor, materials or services to the project.

Montana

Bond Claim Deadlines
90 Days

Must file bond claim within 90 days of the project's completion. Lawsuit to enforce due within 1 year from when the cause of action has arisen, or if the contracting agency has implemented a settlement proceed to handle claims, within 1 year from when a final decision in such procedure is published.

Montana Bond Claim (Little Miller Act) FAQs

Montana Bond Claim FAQs

Who Is Protected under Montana Bond Claim Laws?

In Montana, parties under the general contractor are entitled to make a claim on the bond. This includes subcontractors, laborers and suppliers to the general or at least first tier subcontractor. It is unclear if parties more remote than sub-subcontractors are entitled to protection under the bond.

When is the Deadline to File a Montana Bond Claim?

The bond claim must be received by the public entity within 90 days of completion of the contract and acceptance of the project.

Who Should Receive the Montana Bond Claim?

Montana law requires that the bond claim be given to the board, council, commission, trustee, officer, or public body contracting for the improvement. It is likely best practice to also send notice of the claim to the prime contractor.

When is the Deadline to Initiate Suit, or, How Long is My Montana Bond Claim Effective?

Montana has no specific statutory provision related to the time in which an action to enforce the bond claim must be initiated. However, the bond itself may set a time limit to initiate suit, often 1 year or less after the final payment. Generally, the action must be initiated within one year from date the cause of action has arisen, or if the contracting agency has implemented a settlement process to handle claims, within one year from when a final decision is published.

What Must the Montana Bond Claim Include?

The bond claim must include the name of the hiring party, the amount of the claim, a short description of labor and/or materials furnished, and the name of the general contractor and the party providing the security.

What Are the Lien Waiver Rules?

Montana does not have statutory lien waiver forms, and therefore, you can use any lien waiver forms. Since lien waivers are unregulated, be careful when reviewing and signing lien waivers. See this article: Should You Sign That Lien Waiver?.

Montana state law is unclear or silent about whether contractors and suppliers can waive their lien rights before any work on the project begins. Accordingly, you want to proceed with caution on this subject. You can learn more about such “no lien clauses” at this article: Where Can You Waive Your Lien Rights Before Payment?

Can Suppliers to Suppliers File Bond Claims?

Maybe. Suppliers to suppliers may be able to file a bond claim in Montana. The law is not clear.

How Must the Montana Bond Claim Be Sent?

The bond claim should be filed with the public entity contracting for the improvement, and should be sent to that entity by registered or certified mail.

Montana Public Project Preliminary Notice FAQs

Do I Need to Send a Montana Preliminary Notice?

It depends. All parties supplying materials or supplies to any subcontractor must deliver preliminary notice to the general contractor to preserve rights to make a bond claim upon no-payment.

When do I Need to Send a Montana Preliminary Notice?

In order to retain rights to make a claim on the bond, a material supplier to any subcontractor must deliver the preliminary notice within 30 days of first delivery of materials or supplies.

What if I Send the Montana Preliminary Notice Late?

Failure to timely send the preliminary notice when required is fatal to a subsequent bond claim.

How Should the Montana Preliminary Notice be Sent?

When required preliminary notice should be sent by certified mail.

To Whom Must the Montana Preliminary Notice be Given?

General Contractor.

Montana Bond Claim (Little Miller Act) Statutes

When you perform work on a state construction project in Montana, and are not paid, you can file a “lien” against the project pursuant to Montana’s Little Miller Act. Since the claim is not against the state or county’s actual property, but instead against a posted bond, the claim is not really called a “lien” but is more frequently referred to as a “bond claim” or “little miller act claim.”

Montana’s Little Miller Act is found in Montana Code Annotated, Title 18, Chapter 2, Part 2, and is reproduced below.

Montana Little Miller Act

18-2-201. Security requirements.

(1) (a) Except as otherwise provided in 85-1-219 and subsections (3) through (5) of this section, whenever any board, council, commission, trustees, or body acting for the state or any county, municipality, or public body contracts with a person or corporation to do work for the state, county, or municipality or other public body, city, town, or district, the board, council, commission, trustees, or body shall require the person or corporation with whom the contract is made to make, execute, and deliver to the board, council, commission, trustees, or body a good and sufficient bond with a surety company, licensed in this state, as surety, conditioned that the person or corporation shall:
(i) faithfully perform all of the provisions of the contract;
(ii) pay all laborers, mechanics, subcontractors, and material suppliers; and
(iii) pay all persons who supply the person, corporation, or subcontractors with provisions, provender, material, or supplies for performing the work.
(b) The state or other governmental entity listed in subsection (1)(a) may not require that any bond required by subsection (1)(a) be furnished by a particular surety company or by a particular insurance producer for a surety company.
(2) The state or other governmental entity listed in subsection (1)(a) may, in lieu of a surety bond, permit the deposit with the contracting governmental entity or agency of the following securities in an amount at least equal to the contract sum to guarantee the faithful performance of the contract and the payment of all laborers, suppliers, material suppliers, mechanics, and subcontractors:
(a) lawful money of the United States; or
(b) a cashier’s check, certified check, bank money order, certificate of deposit, money market certificate, bank draft, or irrevocable letter of credit, drawn or issued by:
(i) any federally or state-chartered bank or savings and loan association that is insured by or for which insurance is administered by the federal deposit insurance corporation;
(ii) a credit union insured by the national credit union share insurance fund.
(3) Any board, council, commission, trustee, or body acting for any county, municipality, or public body other than the state may, subject to the provisions of subsection (1)(b), in lieu of a bond from a licensed surety company, accept good and sufficient bond with two or more sureties acceptable to the governmental entity.
(4) Except as provided in subsection (5), the state or other governmental entity may waive the requirements contained in subsections (1) through (3) for building or construction projects, as defined in 18-2-101, that cost less than $50,000.
(5) A school district may waive the requirements contained in subsections (1) through (3) for building or construction projects, as defined in 18-2-101, that cost less than $7,500.

18-2-202. Failure to require security -- waiver.

If any board, council, commission, trustee, or body acting for the state or any board of county commissioners or any mayor and common council of any incorporated city or town or tribunal transacting the business of any such municipal corporation waives or fails to take the security required or authorized by 18-2-201, the state or the county, incorporated city or town, or other municipal corporation is liable to the persons mentioned in 18-2-201 to the full extent and for the full amount of all of the contracted debts by any subcontractor as well as the contractor.

18-2-203. Amount and terms of security.

The security mentioned in 18-2-201 must be in an amount equal to the full contract price agreed to be paid for the work or improvement and must be to the state of Montana, except in cases of cities and towns, in which case the municipality may by general ordinance fix and determine the amount of the security and the name of the secured party, provided that the amount may not be for less than 25% of the contract price of the improvement, and the security may designate that the amount is payable to the city or town and not to the state of Montana.

18-2-204. Right of action on security -- notice.

(1) All persons mentioned in 18-2-201 have a right of action in their own name or names on any security furnished under the terms of this part for work done by the laborers or mechanics and for provender, materials, supplies, provisions, or goods supplied and furnished in the work or the making of the improvements. The persons do not have any right of action on the security unless within 90 days after the completion of the contract with an acceptance of the work by the affirmative action of the board, council, commission, trustees, officer, or body acting for the state, county, or municipality or other public body, city, town, or district, the laborer, mechanic or subcontractor, or materialman or person claiming to have supplied provender, materials, provisions, or goods for the prosecution of the work or the making of the improvement presents to and files with the board, council, commission, trustees, or body acting for the state, county, or municipality or other public body, city, town, or district a notice in writing in substance as follows:

“TO (here insert the name of the state, county, or municipality or other public body, city, town, or district):
NOTICE IS HEREBY GIVEN that the undersigned (here insert the name of the laborer, mechanic or subcontractor, or materialman or person claiming to have furnished labor, materials, or provisions for the contract or work) has a claim in the sum of …. dollars (here insert the amount) against the security taken from …. (here insert the name of the principal and name of the person providing the security) for the work of …. (here insert a brief mention or description of the work concerning which the security was taken). (Here to be signed) ….”
(2) The notice must be signed by the person or corporation making the claim or giving the notice. After being presented and filed, the notice is a public record open to inspection by any person.

18-2-205. Effect of dealing with subcontractor.

A corporation or person performing services or furnishing provender, provisions, supplies, or material to a subcontractor has the same right under the provisions of the security as if the work, services, provender, provisions, supplies, or material was furnished to the original contractor.

18-2-206. Notice to contractor concerning subcontractor.

(1) A person, firm, or corporation furnishing provender, provisions, materials, or supplies to be used in the construction, performance, carrying on, prosecution, or doing of any work for the state or any county, city, town, district, municipality, or other public body shall, not later than 30 days after the date of the first delivery to a subcontractor or agent of a person, firm, or corporation having a subcontract for the construction, performance, carrying on, prosecution, or doing of the work, give a notice of a right of action on the security.
(2) (a) The notice must be delivered personally or sent by certified mail to the contractor.
(b) The notice must be in writing and state:
(i) that it is a notice of a right of action on the security;
(ii) that the person, firm, or corporation giving the notice has commenced to deliver provender, provisions, materials, or supplies;
(iii) the name of the subcontractor or agent who placed the order or to whom the provender, provisions, materials, or supplies were delivered; and
(iv) that the contractor and the contractor’s security will be held for the unpaid price if the supplier is not paid.
(3) To have a right of action against the contractor and the security under this part, a person, firm, or corporation shall give the written notice required by this section in substantially the form described in subsection (2). Any other type of actual or constructive notice is not sufficient.
(4) A suit or action may not be maintained in any court against the contractor or the security to recover for the provender, provisions, materials, or supplies or any part thereof unless the provisions of this part have been complied with.

18-2-207. Costs -- attorney fees.

In a suit or action brought against the surety, payor, or other person liable on the security by a person or corporation to recover for any of the items specified in this part, the prevailing party is entitled to recover, in addition to all other costs, attorney fees in a sum that the court finds reasonable. However, attorney fees may not be allowed in a suit or action brought or instituted before the expiration of 30 days following the date of filing of the notice required in 18-2-206.

18-2-208. Exceptions.

(1) The provisions of this part do not apply to money loaned or advanced to a contractor, subcontractor, or other person in the performance of the work.
(2) A city or town may impose any other or further conditions and obligations in the security that is considered necessary for its proper protection in the fulfillment of the terms of the contract and not in conflict with this part.
(3) The notice required by 18-2-204 to be given within 90 days after completion of the contract and acceptance of the work may not be construed to prevent or delay the payment of money due the contractor under the terms and conditions specified in the contract.