Back in July we defined First Furnishing, Last Furnishing and Completion dates and provided you with an example of these dates in action. Today, we are going to focus on the importance of an accurate first furnishing date.
If you were asked “When did you first furnish on this project?” what date would you provide? Would you provide the date the materials or services arrived on the job site or would you provide an invoice date? Would you be able to provide any date at all?
Most statutes require a notice be served within so many days from first furnishing, which is typically the date the materials or services arrive on the job site. Although some companies may generate an invoice the same day as providing labor or materials, using an invoice date as a furnishing date could put your mechanics lien or bond claim rights in jeopardy.
Here’s an Example:
Let’s say you are providing a one-time shipment of materials to a private California project. We know, per section 8100-8118 of the California Civil Code, the preliminary notice should be served within 20 days from first furnishing materials or services.
For our example, we will use these dates:
- The date your materials/labor arrived on the job site: 07/31/2014
- The date you customer was invoiced for the materials/labor: 08/15/2014
If we use our invoice date as the first furnishing date, the notice would become due 9/4/2014. (08/15/2014 plus 20 days)
Unfortunately, our actual first furnishing was 07/31/2014 (the date our materials arrived on the job site), which means the notice would have to have been served by 08/20/2014 (07/31/2014 plus 20 days). If the notice was not served until 09/02/2014, the notice would be late & could mean our mechanic’s lien may be unenforceable.
In addition to calculating deadlines, the furnishing dates provided may be listed on the mechanic’s lien or bond claim documents. As you can imagine, the accuracy of the information within the documents can be just as important as timely filing or service.
Today’s-Take-Away: Don’t let a few simple days affect your security on any project. Take the necessary steps to ensure the furnishing dates used for your projects are pulled from reliable sources.