Arkansas Notice to Owner by Contractor

Introduction

Key Things to Know

1. 1

   Arkansas's early notice is the IMPORTANT NOTICE TO OWNER that section 18-44-115(a)(7) prints in full. The residential contractor hands it to the owner before work commences, on behalf of all potential lien claimants, and it may be incorporated into the contract or affixed to it rather than sent as a separate letter.

2. 2

   One missing notice takes out the whole job. Under (a)(1) no lien may be acquired on residential real estate of four or fewer units unless the owner or an agent received a copy, and under (a)(5)(C) no claimant may lien unless at least one copy arrived, whoever sent it.

3. 3

   The flip side is that any potential lien claimant may give it, and one copy covers everybody. If a subcontractor, supplier or laborer gives the notice before commencing work or supplying goods, (a)(5)(B)(i) makes that notice effective for all the others, even though the project had already started.

4. 4

   Timing is a point, not a count, on the residential side. Subsection (a)(3) says before the commencement of work. There is no number of days to calculate, which means this belongs in the contract signing packet rather than in a diary reminder.

5. 5

   Delivery is limited to two routes: personal delivery, or certified mail. Subsection (a)(2) adds that where the notice goes by certified mail it does not require the signature of the owner or the agent, so the certified mail record is what you keep instead.

6. 6

   Failing to give it is a fineable offense in Arkansas, not just a lost lien. Subsection (a)(6) makes a residential contractor who fails guilty of a violation under section 5-1-108, punishable by a fine not exceeding one thousand dollars.

7. 7

   Commercial property is a different statute inside the same section. Subsection (b) applies to nonresidential real estate and to residential buildings of five or more units, requires a claimant to tell the owner and the contractor in writing that it is currently entitled to payment but has not been paid, and sets the sending point before seventy-five days have elapsed from the time the labor was supplied or the materials furnished.

Arkansas Requirements for Preliminary Notice

• No Notice, No Lien for Anyone on the House

  Section 18-44-115(a)(1) provides that no lien upon residential real estate containing four or fewer units may be acquired by virtue of the subchapter unless the owner, the authorized agent or the registered agent received a copy of the notice. Subsection (a)(5)(C) adds that no subcontractor, laborer, material supplier or other claimant may claim a lien unless at least one copy was received, which need not have been given by that claimant.

• The Residential Contractor's Duty, Before Work Commences

  Subsection (a)(3) makes it the duty of the residential contractor to give the owner, the authorized agent or the registered agent the notice on behalf of all potential lien claimants before the commencement of work. Arkansas sets no number of days, so the deadline is the start of work itself.

• Any Claimant May Give It, and One Copy Serves All

  Subsection (a)(5)(A) lets any potential lien claimant give the notice, and (a)(5)(B)(i) makes a notice given by a subcontractor, material supplier, laborer or other claimant before commencing work or supplying goods effective for all of them, even though given after the project commenced. Under (a)(5)(B)(ii) a claimant relying on another claimant's later notice has a lien only for labor, material and services supplied after that notice's effective date.

• Personal Delivery or Certified Mail, Nothing Else

  Subsection (a)(1) names two routes for the residential notice: personal delivery, or certified mail. Subsection (a)(2) provides that the notice shall not require the signature of the owner or the agent in an instance when it is delivered by certified mail, so the postal record stands in for the signature.

• The Fixed IMPORTANT NOTICE TO OWNER Form

  Subsection (a)(7) prints the notice and requires it to be conspicuous, set out in boldface type, worded exactly as stated in all capital letters. It is headed IMPORTANT NOTICE TO OWNER, written in the owner's voice, and may be incorporated into the contract or affixed to it. It ends with an owner signature line, the address of the property, the date, and a contractor certification that the signature is the owner's or the owner's registered or authorized agent's. The Arkansas Department of Labor and Licensing publishes the same text as IMPORTANT NOTICE INSTRUCTIONS.

• A Fine of up to One Thousand Dollars

  Subsection (a)(6) makes a residential contractor who fails to give the notice guilty of a violation pursuant to section 5-1-108, and on a guilty or nolo contendere plea or a finding of guilt the contractor shall be punished by a fine not exceeding one thousand dollars. That sits on top of subsection (a)(4), under which the contractor may not avail himself or herself of the benefit of the lien.

• A Bond or a Direct Sale Switches the Requirement Off

  Subsection (a)(8) provides that where the residential contractor supplies a performance and payment bond, or the transaction is a direct sale to the property owner, the notice requirement does not apply and lien rights are not conditioned on delivery and execution of the notice. A sale is direct only if the owner orders the materials or services from the claimant AND the claimant is not a home improvement contractor or a residential building contractor as defined in section 17-25-502. Attorney review is available on this subsection, which is corroborated from a published copy of the code because Arkansas publishes its official code only behind a login.

• Commercial Property Runs on Subsection (b) Instead

  Subsection (b)(3) confines the residential notice to residential real estate of four or fewer units. For nonresidential property and residential buildings of five or more units, (b)(4) requires a subcontractor, service provider, material supplier or laborer to notify the owner or an agent in writing that it is currently entitled to payment but has not been paid, and (b)(5)(A) requires the notice to go to the owner or agent and to the contractor before seventy-five days have elapsed from the time the labor was supplied or the materials furnished. Service may be by an officer authorized to serve process, by mail with return receipt requested and delivery restricted to the addressee or agent, or by any means providing written third-party verification of delivery.