Notice of Intent to Claim Lien & Memorandum of Lien Filing Procedures

Notice of Intent to Claim Lien & Memorandum of Lien Filing Procedures

Mechanics Lien Agent (MLA) Notice Requirements (Va. Code § 43-4.01)

To protect innocent home buyers from unrecorded "secret liens" on new residential construction, Virginia established the Mechanics Lien Agent (MLA) system under Va. Code § 43-4.01. This statute applies specifically to construction, alteration, or repair of one- and two-family residential dwellings.

Designation of an MLA

When a building permit is issued for a 1- or 2-family residential property, the property owner may designate a Mechanics Lien Agent (typically a title insurance company or attorney). If designated:

1. The local building authority must print the MLA's name, full address, and telephone number on the face of the building permit.
2. The permit must be posted conspicuously at the residential job site.

The Mandatory 30-Day MLA Notice Rule

Subcontractors, sub-subcontractors, and material suppliers who do not deal directly with the property owner must provide formal written Notice to the Mechanics Lien Agent to preserve their lien rights against subsequent good-faith purchasers:

• Timeline: Written notice must be sent to the MLA within 30 days of starting work or within 30 days of building permit issuance.
• Method of Delivery: Notice must be delivered by registered or certified mail with return receipt requested, or hand-delivered with written receipt.

[Building Permit Issued / Work Commences] -------- (30 Days) --------> [Mandatory MLA Notice Deadline]

Impact of Late MLA Notice

If a claimant fails to send notice within the initial 30-day window, their lien rights are not entirely destroyed, but they are severely restricted:

• Notice provided after 30 days only protects lien rights for labor performed or materials furnished on or after the date the MLA receives the notice.
• All labor or materials supplied prior to the actual date of late MLA notice are permanently barred from being included in any future mechanics' lien.

---

Required Elements of the Memorandum of Mechanics' Lien

Filing a mechanics' lien requires recording a formal legal document called a Memorandum of Mechanics' Lien. Under Va. Code § 43-5 (for General Contractors) and Va. Code § 43-8 (for Subcontractors), the memorandum must be prepared with exact technical accuracy.

Essential Components of the Memorandum

1. Claimant Details & License Info: Name, address, and DPOR contractor license number, license class (Class A, B, or C), and license expiration date. Under Va. Code § 54.1-1115, an unlicensed contractor cannot enforce a mechanics' lien.
2. Owner & Property Information: Full legal name(s) of the record property owner(s) and legal property description (including Tax Map Parcel Number, subdivision lot/block, deed book reference, and physical street address).
3. Itemized Financial Account: Total contract amount, itemized value of work performed and materials supplied, total payments received to date, and the net unpaid balance claimed.
4. Dates of Service: The date from which interest is claimed (typically the last work date or invoice due date) and the date work was completed or terminated.
5. Notarized Verification Under Oath: The memorandum must contain an affidavit verified under oath before a notary public by the claimant or their authorized representative.

---

Circuit Court Recording Procedures

The Memorandum of Mechanics' Lien must be recorded in the land records of the Clerk of the Circuit Court in the city or county where the real property is situated.

Step-by-Step Recording Process

1. Venue Determination: If a project spans county lines, separate memorandums must be recorded in each respective Circuit Court clerk's office.
2. Recording Fees & Taxes: The claimant must pay the Circuit Court recording fee (typically determined by document page count and state statutory fee schedules).
3. Grantor/Grantee Indexing: The Circuit Court clerk indexes the memorandum under the Property Owner's name as Grantor and the Claimant's name as Grantee.
4. Timestamping & Perfection: The lien becomes officially encumbered and perfected the moment it is accepted, timestamped, and recorded by the clerk.

---

Service of Notice on Owner and General Contractor

Recording the memorandum in land records is only part of the statutory requirement. Subcontractors and lower-tier claimants must satisfy strict post-recording service rules under Va. Code § 43-7 and Va. Code § 43-9.

Subcontractor Notice Obligations (Va. Code § 43-7)

A subcontractor must furnish a copy of the recorded Memorandum of Lien to the property owner by certified mail or personal service.

• Serving this notice establishes the owner's personal liability up to the amount the owner owes the general contractor at the time notice is served.

Sub-subcontractor Notice Obligations (Va. Code § 43-9)

A sub-subcontractor or lower-tier material supplier must serve a copy of the recorded memorandum upon BOTH the property owner AND the general contractor.

[Record Memorandum at Circuit Court] 
        |
        +---> [Serve Copy to Property Owner (Va. Code § 43-7)]
        |
        +---> [Serve Copy to General Contractor (If Sub-Sub, Va. Code § 43-9)]

Failure to properly serve notice on all required parties prevents the claimant from establishing the owner's personal liability under Title 43 and invalidates lower-tier lien enforcement.