Alabama Lien Law 101

You did not get paid for your labor and material, so you ask, what can I do? Alabama’s lien law provides you an opportunity to place a lien on the property for certain unpaid amounts for labor and materials. If you follow the proper procedures to perfect the lien and obtain a judgment in your favor, you may force the sale of the property to collect on your judgment (see Ala. Code § 35-11-226). This article focuses on the procedural basics of Alabama’s lien law. One of the most important things to understand is that lien laws are technical and must be followed closely; therefore, it is always advisable to seek the assistance of legal counsel early in the process to ensure your lien rights are timely exercised.

Initial Notice: In Alabama, parties with a direct contract with the property owner (such as a general contractor) are not required to provide notice to the owner prior to recording a lien. However, it often is a good idea to do so. Parties that do not have a direct contract with the property owner (such as subcontractors or journeymen) are required to give notice in writing to the owner prior to recording the lien. It is important that this notice follows all requirements in Ala. Code § 35-11-218. For example, the notice of intent to lien should describe the property, state that the party claims a lien on the property, indicate the amount of the lien, and what party owes the unpaid amount. If the notice meets those requirements and the lien is properly filed, the unpaid contract balance in the hands of the property owner at the time of that notice is subject to the lien claim. It is good practice to send the notice of intent to lien by certified mail, return receipt requested, to create a record that it was received by the property owner.

A party that does not have a direct contract with the owner may avail itself to a lien for the full price of materials it plans to provide if it notifies the property owner in advance of providing such materials (see Ala. Code § 35-11-210). The notice must be in writing, state that the party will supply materials for a certain price and must be provided before furnishing any material. Also, the owner must not object. If the owner objects in writing, then the party will have an "unpaid balance" lien described above, assuming the lien requirements are properly followed.

Lien Contents and Where to Record: The lien must follow all requirements of Ala. Code § 35-11-213. For example, it must include a statement in writing, verified by the oath of the person claiming the lien with knowledge of the facts, the amount of the lien, a property description upon which the lien is claimed, and the name of the property owner. The lien must be recorded in the office of the judge of probate of the county where the property is located.

Deadline to Record the Lien: A party with a direct contract with the property owner (such as a general contractor) has six (6) months from the last date it supplied labor or materials to the property to record its lien. A party that does not have a direct contract with the property owner (such as a subcontractor) has four (4) months from the last date it supplied labor or materials to the property to record its lien. Journeymen and day laborers have thirty (30) days from the last date they supplied labor or materials to the property to record their liens (see Ala. Code § 35-11-215).

Deadline and Place to File the Complaint: A lienor must file a complaint to enforce the lien in state circuit court in the county where the property is located within six (6) months of the maturity of the entire indebtedness (see Ala. Code §§ 35-11-220 and -221). The maturity of the entire indebtedness is based on the payment terms in the agreement. For example, a contractor submits a final invoice on January 1 for labor and materials. The invoice is net 30, meaning it is due on January 30. On January 30, the indebtedness has become mature. The complaint to enforce the lien in this instance should be filed six (6) months from January 30, which is July 30.

Things to Remember: Do not rely on the identification of the property owner in your contract as the actual owner. Lien claimants should obtain a title search of the probate records. Be timely. Deadlines can be tricky and missing them can be fatal to your lien claim. Follow the statutory requirements carefully. If you are not experienced in this process, seek the help of legal counsel.

Republished with permission. This article, "Alabama Lien Law 101" was published in BuildSouth Summer 2024, Volume 15, No. 3.