Kelly M. Davis & Associates, LLC - Dallas Construction Attorney
Kelly M. Davis & Associates, LLC
Friday Links:
Be careful cashing that check – Good advice for contractors in Texas also.
Lets hope this comes true – Hopefully they want a custom home to help get the custom home builders building again.
Texas House Committee on Judiciary & Civil Jurisprudence Meeting - Potentially a little biased, but something to watch out for.
The big builder news in Texas – Luckily no one was hurt or killed in the collapse and the rain didn’t start till a week later…here comes the litigation.
While most of you know that I primarily practice in the Construction Law arena, I am also very passionate about the necessity of Estate Planning / Wills.
This year has been an eventful year in many respects. One of the most unusual surrounds one of my probate cases. This isn’t an ordinary probate case but involves 65 heirs. I know, you are probably asking yourself how anyone can even have 65 heirs. The problem here? The woman died without executing a will. She had no parents, no husband, no children, and no siblings. However, her parents had siblings, who had siblings, who had siblings, and so forth. Confused? Believe me, so is the Court and everyone associated with this case. I knew that the woman had seen an attorney about drafting a will but had just never followed through with her resolution. The result was an unqualified mess which cost many man hours and a large financial commitment to unwind.
Below is an article that Iike to post at the beginning of each year because I think it is a good idea to make creating/updating your Will a New Year’s resolution at least every 5 years:
One of the reasons that people have the same resolutions year after year is that nobody actually develops a Plan of Action to accomplish these goals. I started thinking about a Plan of Action in the context of the number one resolution I see as an attorney – the Estate Plan.
I think that a majority of the reasons why most people do not follow-through on their Estate Planning goal is fear. Within the age of blended families, most people do not want to deal with the issues of how to divide their assets, who to manage their estates, and who to take care of her children. However, do you really want the alternative? If you die without a will, named executors, trustees and guardians, the good Ole State of Texas decides for you. Since when did the State of Texas do something purely in your best interest? I think we all know the answer to that question – NEVER!
So, what do you do? I would suggest that a Plan of Action would be a good idea for any resolution that you truly want accomplished. This Plan might help you overcome your fears and accomplish your goals.
So, what should your Plan of Action be in accomplishing your estate planning goals?
While your Plan of Action might have a few less steps or a few more steps, as you can see, when it is written down it looks more manageable. Don’t let this be another failed resolution, whether it is an Estate Plan or some other resolution; create your Plan of Action and most of all, stick to it!
Last month, we talked about retainage claims and how you protect your ability to collect on retainage funds that are not timely paid to you.
This month, I wanted to discuss warranty claims. Many clients believe that warranty claims can extend their mechanic’s lien deadlines. For most clients, this would be generally untrue because the deadlines for their work performed or material supplied would not be calculated pursuant to the Substantial Completion rule, discussed below. However, there is what may be referred to as a “loophole” that can be used to extend deadlines in very particular situations. This would never be something I would recommend or could rely on with certainty as a court of law would have to determine its applicability to the particular circumstances.
That being said, in order to clear up some of the myths that are circulating relating to the extension of deadlines by warranty claims, it is important to understand the distinctions. Most lien deadlines are calculated from the date that work was first performed. Thus, doing more work does not generally extend the deadline. However, the lien deadlines are calculated by the earlier of the 3 / 4 months after work was performed (depending on whether it is considered a residential or commercial project) OR WITHIN 30 DAYS AFTER SUBSTANTIAL COMPLETION OF ENTIRE THE PROJECT (not just your portion), whichever is sooner.
So, while most subcontractors and suppliers fall within the normal mechanic’s lien deadlines, if you perform work at the end of the project (such as landscaping, which is generally one of the last aspects of a construction project), your lien deadline can be shorter than the typical 3 / 4 month time frames (as set forth in the “Deadline” portion of this email).
If you believe you are late on your mechanic’s lien or notice letter, there is quite a bit of case law that attorneys can and do use to argue around the deadlines. One such case law relates to warranty work. Warranty work can, in some instances, be the basis for arguing that substantial completion has not occurred, and thus a claimant is not late on a lien. Some courts have extended substantial completion deadlines to include punch and warranty work.
So, what does this mean to you? If you are a subcontractor or supplier that performs work or supplies during the first or middle portion of the construction project, it means absolutely nothing because your lien deadlines are not dependent on substantial completion of the project. However, if you perform work on what might be considered the later part of the project (about the last 4 months), your deadlines might be shorter than normal but, on the other hand, any warranty work that may have been performed on the project could possibly be used to extend the timeframe for you to properly perfect your lien.
There are a lot of companies out there filing their own liens and/or notice letters. As you can see, there is not one exact formula to the mechanic’s lien process. It depends on a variety of circumstances, all which must be taken in consideration to determine your deadlines and filing requirements. The best business practice is to meet with an attorney that understands your business and how your work fits within these deadlines. While the use of loopholes to extend your deadlines can be beneficial it certainly cannot be relied upon on a day to day basis.
January Mechanic’s Lien Deadlines
Commercial Projects
1st Tiered Claimant:
Your notice letters are timely for work done any time after October 1, 2009.
Your mechanic’s liens are timely for work done any time after September 1, 2009.
2nd Tiered Claimant:
Your notice letters are timely for work done any time after November 1, 2009.
Your mechanic’s liens are timely for work done any time after October 1, 2009.
Residential Projects
For all Claimants:
Your notice letters are timely for work done any time after November 1, 2009.
Your mechanic’s liens are timely for work done any time after October 1, 2009.
