Procedure for Perfecting Liens

1. Full Price Liens.

   1. The Preliminary Notice.

      Materialmen, not having a direct contract with the owner but who are instead suppliers to a general contractor or a subcontractor, must serve notice on the owner in order to obtain a “full price lien”. The Alabama Code Section 35-11-210 (1975) provides an example form. However, the notice incorporated into the statute is inconsistent with the express provisions of the statute. The statute clearly states that the notice must show that “certain specified material” will be furnished at “certain specified prices.” Nevertheless, some court s have held that the statutory form is sufficient. Avondale Lumber Co. v. Hudson, 106 So. 803 (Ala. 1926); Tisdale v. Alabama & Georgia Lumber Co., 31 So. 29 (Ala. 1902).

      More recently, Alabama courts have begun a shift toward enforcing the specific requirements of the statute. Kilgore v. First Assembly of God Church, Inc., 477 So.2d 300 at 302 (Ala. 1985). In Kilgore, the court found a preliminary notice insufficient, in part, because it failed to list “certain specified prices” as required by Ala. Code § 35-11-210. In 1991, the Alabama Supreme Court continued its shift toward enforcing the literal provisions of the statute by stating that

      [the Contract] used the form suggested by the statute, but did not specify prices as required by the text of 35-11-210. However, we can decide this case without deciding the particular issue of whether the language of the text or the language of the form controls. Nevertheless, we fell it will be helpful to the bench and bar, as well as suppliers of materials and labor, to note that a mechanic’s lien for the full price of materials or labor supplied arises from an expressed or implied contract between the supplier and the owner to supplied purchase material or labor…If the notice is to be deemed a contract purchase between the owner and the supplier, it must contain all of the terms to which the supplier, it must contain all of the terms to which the supplier wishes to hold the owner; i.e., it should contain a statement of the material to be furnished, the price thereof, and any credit terms that may be included in the contract between the supplier and the purchaser of materials or labor-the general contractor or subcontractor.

      Davis v. Gobble-Fit Lumber Co., 592 So.2d 202 (Ala. 1991). The statute requires that the notice be given prior to materialmen furnishing any material; however, the statute does not indicate how much advance notice should be given. Reasonable advance notice is implied from the fact that the owner is given the opportunity to object to the notice before the material is used. An original contractor is not required to provide this notice.

   2. Notice of Intent.

      See the discussion under the unpaid balance lien section.

   3. Verified Statement of Lien.

      See the discussion of verified statement of lien under the unpaid balance lien section below.

2. Unpaid Balance Liens.

   1. Preliminary Notice.

      Unpaid balance lien claimants need not provide the owner with a preliminary notice prior to supplying material.

   2. Notice Of Intent.

      All lien claimants, except an original contractor must give notice prior to filing a verified statement of lien. The notice must be given in writing to the owner stating that a lien is claimed, setting forth the amount and the subject of the lien, and the person or entity from whom it is owning. Ala. Code § 35-11-218. This same notice must be given to the general contractor and the construction lender. Payvee Mortgage Co. v. Gobble-Fite Lumber Co., Inc., 565 So.2d 138 (Ala. 1990). The purpose of this notice is to allow the owner to take appropriate action in the disbursement of the remaining funds to the general contractor to ensure that the potential lienors are satisfied and that the property is not encumbered. Hubbard, A Current Overview of Alabama’s Mechanic’s and Materialman’s Lien Law, 49 Alabama Lawyer, 203, 205 (1988). The notice also protects the owner in compliance with the requirement of the statute. Rawls Warehouse, Inc. v. Jackson, 383 So.2d 152 (Ala. 1980).

      Failure to give the notice of the claimed lien to the owner prior to the filing of the verified statement of lien invalidates the lien. Buckner v. Alfa Lumber & Supply co., 628 So.2d 450 (Ala. 1993). The only timing provision for this notice is that it be given before the filing of a verified statement of lien. Ala. Code § 35-11-218.

   3. Verified Statement of Lien.

      Ala. Code § 35-11-213 sets forth a statutory form for a verified statement of lien. The strict use of this statutory form is not necessary as long as the form used is in substantial compliance with Alabama Code 35-11-213. Harper v. J&C Trucking and Excavating Co., 374 So.2d 886 (ala. Civ. App. Ct. 1979). But see Hill v. Hill, 2000 UL 27330 at 12 (Ala. Civ. App. 2000) (merely filing a lease agreement was not sufficient to allow enforcement of lien). Generally, the verifying statement must set forth the amount of the demands secured by the lien, contain a description of the property on which the lien claims, and the name of the owner or proprietor of the land. Ala. Code § 35-11-2133.

      The verification must be made on the affiant’s personal knowledge. An oath “to the best of affiant’s knowledge and belief” is not a verification of the truth of the facts and does not comply with the statute. Globe Iron Roofing and Corrugating Co. v. Thatcher, 6 So. 366 (ala. 1889). But see Firestone v. Howell, 582 So.2d 1113 (Ala. 1991), allowing an attorney to sign on behalf of client.

      The statute requires that the verified statement accurately describe the property upon which lien is sought to be perfected. The extent of the description required by Courts seems to vary on a case by case basis. (See Ala. Code § 35-11-213 providing that the description shall be “in such a manner that the same may be located or identified, a description by house number, name the street, and name of the city or town being a sufficient description where the property is located in a city or town.) Lien claimants will be well advised to describe the property at issue as accurately as possible.

      1. City or Town. When the land at issue is located within a city or town, the lien extends to all the right, title and interest of the owner and “to the extent any of the entire lot or parcel of land in a city or town…” Ala. Code § 35-11-210. As mentioned above, the statute specifically provides that with regard to such property, “a description by house number, name of street, and name of city or town” is sufficient. Ala. Code § 35-11-213.
      2. Not in City or Town. Property located outside the city or town may be liened not only with respect to the building improvements and the land on which such is situated, but also to “one acre in addition to the land upon which the building or improvement is situated…” Ala. Code § 35-11-210.
      3. Statement of Lien. A verifying statement of lien must be filed in the office of the Judge of Probate of the county where the subject property is located. Ala. Code § 35-11-213. When the property is located in more than one county, the verified statement must be filed in each county where the land is located.
      4. Timing. Ala. Code § 35-11-215 sets forth various time periods for different lienors to file a verified statement depending on the status of each lienor.
      5. Laborers. Must file the verified statement within 30 days of the last labor provided on the project. Ala. Code § 35-11-215 (1975).
      6. Original Contractors. Original contractors must file the verified statement of lien within six months after the last of item of work has been furnished. Ala. Code § 35-11-215 (1975). A “full price” lien claimant is considered an original contractor within this provision and therefore has six months from the furnishing of the last item of work or material within which to file its verified statement. Southern Sash of Huntsville, Inc. v. Jean, 235 So.2d 842 (Ala. 1970).
      7. Every Other Person. Every other lien claimant must file its verified statement of lien within four (4) months after the last item of work or material has been performed or furnished. Ala. Code § 35-11-215 (1975).