Don’t Forget to Serve Your Notice of Furnishing – But Only After Starting Work
Kegler Brown Construction Alert August 30, 2010
The lien law was drafted to encourage subcontractors and suppliers to serve a Notice of Furnishing ("NOF") before providing labor or materials, or within 21 days of the first work or delivery, to preserve all lien rights on the project. Unfortunately, the Twelfth District Court of Appeals has ruled otherwise in the case of Halsey, Inc. v. Isbel, 2010 Ohio 2052 (May 10, 2010). In that unexpected decision, the Court of Appeals ruled that a NOF served before the materials were supplied was ineffective, which rendered the supplier's lien invalid.
Therefore, until this decision is overturned or the issue is resolved otherwise by the Ohio Supreme Court, and in an abundance of caution, we are recommending that all subcontractors and suppliers serve a NOF as soon as possible AFTER they begin providing labor or material to a job. The NOF should be served on the owner and contractor on private work and the prime contractor on public work by a method (such as certified mail) that produces a written receipt. A failure to do so risks the loss of both mechanic's lien and payment bond rights.