RSA 447:9 and :10 provide that a mechanic’s lien must be secured through an attachment of the property improved within 120 days of the lienor’s last furnishing of labor or materials. Over the years this statutory time frame has been lengthened by the legislature, from 60 days, to 90, and now to 120 – but actually recording a court-approved attachment within the allowable time has always been required. As one early case noted, “The plaintiff’s lien depends for its existence and continuance upon a strict compliance with the provisions of the statutes. Neglect to commence a suit and secure it by attachment upon the property within sixty days from the time the labor thereon was performed, or the materials therefor furnished, would operate to dissolve it.” Marston v. Stickney, 55 N.H. 383, 385 (1875).
Suppose an unpaid contractor or supplier is trying to work things out with a customer as the 120-day deadline looms, and the parties want to extend the deadline. Can they?
There are good reasons to think they can. The time limit is designed to provide a fixed cutoff after which owners may rest easy. In general, “statutory provisions enacted for the benefit of individuals may be so far waived by those for whose benefit they were enacted,” Mulhall v. Nashua Manufacturing Company, 80 N.H. 194, 205 (1921). This rule was applied to the notice rights of an owner in Janvrin v. Powers, 79 N.H. 44, 48 (1918) ("The statute prevents sub-contractors from acquiring liens upon the property of owners unless the statutory notices are given, and is for the protection of owners. The defendant's contention that he could not waive the statutory requirements of notice cannot be sustained. The statute being for his benefit there is no doubt that he could waive it.").
Then there is the statement in Tolles-Bickford Lumber Co., Inc. v. Tilton School, 98 N.H. 55, 58 (1953), that “The failure to perfect the lien within ninety days results in its expiration in the absence of a waiver which is not present in this case.” (The statutory deadline was increased from 90 days to 120 days in 1991.) Granted, this “absence of a waiver” language is what lawyers call dicta (statements not forming the basis for the decision), but the Court would have had little reason to mention a waiver exception if one didn’t exist.
I conclude that the 120-day deadline for an attachment to perfect a mechanic’s lien may be extended by agreement with the owner. But what about time extensions without the owner’s agreement? May the statutory deadline for the attachment be extended in any other way?
Recently a Superior Court judge ruled that just filing suit provides an automatic extension. In considering several attachment petitions relating to the same project, he issued an order in one of the cases stating “This request is taken under advisement pending the issuance of a consolidated order on all other outstanding requests for mechanics’ liens and attachments related to this construction project.” The plaintiff, a supplier whose 120-day window was about to close, immediately moved for interim approval of its attachment while the judge pondered his consolidated order. The court denied the motion, ruling that “While RSA 447:10 suggests the mechanic’s lien may be secured by attachment made ‘while the lien continues,’ the Court finds the lien continues while the suit is pending, that the 120-days is tolled once the suit is filed. To hold otherwise would effectively and pragmatically deprive all would-be mechanic’s lien holders of the full 120 statutory lien period because they would realistically be required to file suit long before the 120-day period expires to ensure the granting of the attachment.”
This rationale falls apart if, as Justice Souter once wrote, “the court may grant an order of attachment ex parte ‘to perfect a labor and materials lien under RSA 447.’” Chagnon Lumber Co. v. Stone Mill Const. Corp., 124 N.H. 820, 823 (1984). And while the ruling appears favorable to lienors, it actually puts them at risk of losing out to “bona fide purchasers of the property for value before the writ of attachment was recorded,” id. at 824.
Suppose an unpaid contractor or supplier is trying to work things out with a customer as the 120-day deadline looms, and the parties want to extend the deadline. Can they?
There are good reasons to think they can. The time limit is designed to provide a fixed cutoff after which owners may rest easy. In general, “statutory provisions enacted for the benefit of individuals may be so far waived by those for whose benefit they were enacted,” Mulhall v. Nashua Manufacturing Company, 80 N.H. 194, 205 (1921). This rule was applied to the notice rights of an owner in Janvrin v. Powers, 79 N.H. 44, 48 (1918) ("The statute prevents sub-contractors from acquiring liens upon the property of owners unless the statutory notices are given, and is for the protection of owners. The defendant's contention that he could not waive the statutory requirements of notice cannot be sustained. The statute being for his benefit there is no doubt that he could waive it.").
Then there is the statement in Tolles-Bickford Lumber Co., Inc. v. Tilton School, 98 N.H. 55, 58 (1953), that “The failure to perfect the lien within ninety days results in its expiration in the absence of a waiver which is not present in this case.” (The statutory deadline was increased from 90 days to 120 days in 1991.) Granted, this “absence of a waiver” language is what lawyers call dicta (statements not forming the basis for the decision), but the Court would have had little reason to mention a waiver exception if one didn’t exist.
I conclude that the 120-day deadline for an attachment to perfect a mechanic’s lien may be extended by agreement with the owner. But what about time extensions without the owner’s agreement? May the statutory deadline for the attachment be extended in any other way?
Recently a Superior Court judge ruled that just filing suit provides an automatic extension. In considering several attachment petitions relating to the same project, he issued an order in one of the cases stating “This request is taken under advisement pending the issuance of a consolidated order on all other outstanding requests for mechanics’ liens and attachments related to this construction project.” The plaintiff, a supplier whose 120-day window was about to close, immediately moved for interim approval of its attachment while the judge pondered his consolidated order. The court denied the motion, ruling that “While RSA 447:10 suggests the mechanic’s lien may be secured by attachment made ‘while the lien continues,’ the Court finds the lien continues while the suit is pending, that the 120-days is tolled once the suit is filed. To hold otherwise would effectively and pragmatically deprive all would-be mechanic’s lien holders of the full 120 statutory lien period because they would realistically be required to file suit long before the 120-day period expires to ensure the granting of the attachment.”
This rationale falls apart if, as Justice Souter once wrote, “the court may grant an order of attachment ex parte ‘to perfect a labor and materials lien under RSA 447.’” Chagnon Lumber Co. v. Stone Mill Const. Corp., 124 N.H. 820, 823 (1984). And while the ruling appears favorable to lienors, it actually puts them at risk of losing out to “bona fide purchasers of the property for value before the writ of attachment was recorded,” id. at 824.
RSS Feed
