# Arizona Lien, Payment Bond, and Stop Notice Summary Guidelines *Published:* 2017-06-12 *Author:* Glenn Jimerson Preliminary Lien Notices ------------------------ “Prelims” should always be given (usually necessary for perfecting lien, bond and stop notice claims) Send within **twenty (20) days** of first day materials/labor furnished (“20-day notices/prelims”). (A.R.S. § 33-992.01(C)) Must send to Owner \[regardless of direct contract\], construction lender, and “person with whom contracted” (A.R.S. § 33-992.01(B)) Can send later than 20 days after first day of furnishing materials/labor, but prelim will only reach back and capture materials/labor furnished within 20 days prior to prelim. (A.R.S. § 33-992.01(E)) Mechanics’/Materialmen’s Lien Claims ------------------------------------ [Must be recorded](https://www.jaburgwilk.com/news-publications/why-bother-recording-your-judgement) in the Recorder’s Office of the county where the job is located within a statutory period of time after “completion” or recording of a “notice of completion.” (A.R.S. § 33-993) “Completion” is defined as thirty (30) days after final inspection and written final acceptance by governmental body that issued permit, or cessation of labor for 60 consecutive days. (A.R.S. § 33-993(C)) - If no notice of completion is recorded and served, a lien claimant has **one hundred-twenty (120) days** from the date of “completion” of the project (not necessarily completion of claimant’s contract) to record its lien claim. Rule of thumb: A lien claimant has 150 days from the date the certificate of occupancy issues to record a lien (30 days for “completion” plus 120 days). (A.R.S. § 33-993(A)) - If a notice of completion is recorded and served, a lien claimant has **sixty (60) days** thereafter to record its lien claim in the county where the property is located. (A.R.S. § 33-993(A)) Lien Claim Foreclosure Lawsuit ------------------------------ Suit must be filed within **six months** from date lien claim recorded. (A.R.S. § 33-998) A [notice of pendency of action](https://www.jaburgwilk.com/news-publications/the-defaulting-seller-and-a-notice-of-lis-pendens) (also called a “lis pendens”) must be recorded within **five days** of filing the lien foreclosure lawsuit. (A.R.S. §§ 33-998, 12-1191) Failure to timely file the lawsuit or timely record the lis pendens is typically fatal to a lien claim foreclosure lawsuit. Stop Notices – (Not applicable to public projects or owner-occupied dwellings) ------------------------------------------------------------------------------ Suppliers and subcontractors entitled to record a lien may serve a [stop notice](https://www.jaburgwilk.com/news-publications/stop-notice-video) on owner or construction lender, personally or by certified mail. General contractor entitled to record a lien cannot serve owner, but can serve lender. (A.R.S. §§ 33-1054, 1055(A), 1056(A)) Must be served **“before the expiration of time allowed to record \[mechanic’s lien\].”** (A.R.S. § 33-1056(B)(2)) Rule of thumb: If you are able to record a lien, you are able to serve a stop notice. Stop Notice Lawsuit ------------------- Suit can be filed any time after **ten days** from the date stop notice served – even before completion of project – but cannot be filed later than **three months** after the expiration of time to record lien. (A.R.S. § 33-1063(A)) “Notice of commencement” of an action to enforce a stop notice claim must be given within **five days** after commencement to the recipients of the stop notice. (A.R.S. § 33-1063(B)) Arizona Public Project Payment Bonds (Federal Miller Act very similar, but does not require prelim) --------------------------------------------------------------------------------------------------- *If not* in direct contract with prime, 20-day prelim must be served (major distinction from Miller Act). (ARS 34-223(A)) *If not* in direct contract with prime, bond claim notice letter must be received by general contractor within **ninety (90) days** of last date materials/labor furnished. Rule of thumb: The 90 days runs from last date of furnishing labor/materials per contract and not necessarily the date of invoice, and warranty/punch-list work and interest/finance charges typically do not extend time. (ARS 34-223(A)) Bond claim notice letter must provide “with substantial accuracy” the amount claimed and the name of the party to whom the material/labor was furnished, and should state claimant is looking to bond principal for payment. Reference bond number if known. If in direct contract w/ prime, neither 20-day prelim nor “90-day letter” is required, but both are recommended. (ARS 34-223(A)) Practice tip: Only the prime contractor must receive the [90-day letter](https://www.jaburgwilk.com/news-publications/critical-change-for-serving-preliminary-20-day-notices-for-arizona-public-projects), but copying the surety, owner, lender, subcontractor, and other interested parties may cause payment to be made sooner. Public Project Payment Bond Lawsuit ----------------------------------- For Arizona and Federal public projects, suit can be filed **after the 90th day** – but **not later than one year** – from the last date materials/labor are furnished to project in furtherance of contract. (ARS 34-223(B)) Purely remedial work may not extend this deadline. Private Project Payment Bond Claims ----------------------------------- Obtain copy of bond, follow the notice and claim requirements specified in the bond, and *sue within the time specified in bond*. Arizona law arguably requires private payment bonds to be *no more restrictive* than payment bonds for public projects. (ARS 33-1003(B)) However, err on the side of caution and comply with the notice, claim, and suit requirements set forth in the bond.