Contractors – Construction Liens – Arkansas
Note: This summary is not intended to be an all inclusive discussion of Arkansas’s construction or mechanic’s lien laws, but does include basic provisions.
What is a construction or mechanic’s lien?
Every State permits a person who supplies labor or materials for a construction project to claim a lien against the improved property. While some states differ in their definition of improvements and some states limit lien claims to buildings or structures, most permit the filing of a document with the local court that puts parties interested in the property on notice that the party asserting the lien has a claim. States differ widely in the method and time within which a party may act on their lien. Also varying widely are the requirements of written notices between property owners, contractors, subcontractors and laborers, and in some cases lending institutions. As a general rule, these statutes serve to prevent unpleasant surprises by compelling parties who wish to assert their legal rights to put all parties who might be interested in the property on notice of a claim or the possibility of a claim. This by no means constitutes a complete discussion of construction lien law and should not be interpreted as such. Parties seeking to know more about construction laws in their State should always consult their State statutes directly.
Who can file a lien in this State?
Arkansas statute permits every contractor, or material supplier, who supplies labor, services, material, fixtures, engines, boilers, or machinery in the construction or repair of an improvement to real estate, by virtue of a contract with the owner, proprietor, contractor, or subcontractor, or agent thereof, to claim a lien against the improvement and up to one (1) acre of land upon which the improvement is situated. A.C.A. § 18-44-101. Arkansas law permits engineers and surveyors to also claim a lien for the contract price or reasonable price for their services towards the improvements of a piece of property. A.C.A. § 18-44-105.
How long does a party have to file a lien?
One hundred and twenty days (120) from the date that labor or materials were furnished. A.C.A. § 18-44-117. The original contractor may file his lien at any time, but other parties must give the property owner ten (10) days notice (see notice below) prior to filing of a lien claim. Accompanying this notice must be a affdavit of notice verifying that the notice required in A.C.A. § 18-44-114 – 116 have also been given. This ten-day provision does not apply if the underlying improvements are part of a direct sale to the property owner. A.C.A. § 18-44-114.
What kind of notice is required prior to filing a lien?
Arkansas statute requires that the form notice found in A.C.A. § 18-44-115 and contained in USlegalform AR-03-09, be served personally or by certified mail on the owner in order to proceed to claiming a lien. A.C.A. § 18-44-115. Arkansas statute also requires that a supplier of labor or materials serve on the property owner and contractor by personal service or registered mail a notice which lists the labor performed, materials provided, names and address of relevant parties, a description of the property, and the amount due. Also required is a notice set out in A.C.A. § 18-44-115(2)(B)(C)(v). This notice must be filed within seventy-five (75) days of the date that material or labor was provided. Any contractor who fails to give this notice shall be guilty of a misdemeanor and shall be punished by a fine not exceeding one thousand dollars ($1,000). A.C.A. § 18-44-115.
By what method is a lien filed in this State?
Arkansas law requires a party wishing to claim a lien to file with the clerk of the circuit court of the county in which the improvements are situated. This filing must be accomplished within one hundred and twenty (120) days of the date labor or materials was provided. The filing itself is described by statute as “a just and true account of the demand due or owing to him after allowing all credits” along with a correct description of the property, verified by affidavit. A.C.A. § 18-44-117.
How long is a lien good for?
In Arkansas, a lien is valid for fifteen (15) months after the date it is filed, unless a suit be filed within that time. A.C.A. § 18-44-119.
Are liens assignable?
Yes. A lien may be assigned to another party as long as the property owner receives notice of the assignment so as to protect himself. A.C.A. § 18-44-113.
Does this State require or provide for a notice from subcontractors and laborers to property owners?
No. Arkansas statutes do not provide for or require subcontractors and laborers to serve a notice of furnishing of labor or materials on the property owner.
Does this State require or provide for a notice from the property owner to the contractor, subcontractor, or laborers?
Arkansas statute allows for the property owner or anyone else with an interest in the property to demand that the contractor or subcontractor provide a list of all parties who provided labor or materials and the amount those parties are due. Also, an interested party can demand certification that the owner has received the required notice under A.C.A. § 18-44-115. Failure to provide this information, or falsifying this information is a misdemeanor under Arkansas law punishable by a fine not to exceed $2,500.00. A.C.A. § 18-44-108.
Does this State require a notice prior to starting work, or after work has been completed?
Yes. Arkansas statutes allow for an individual supplier or laborer to give notice to an owner and contractor that materials and/or labor has been provided and the possibility of a lien exists.
Does this State permit a person with an interest in property to deny responsibility for improvements?
No. Arkansas does not have a provision on this point.
Is a notice attesting to the satisfaction of a lien provided for or required?
Arkansas law requires a lien holder whose lien is satisfied to enter a satisfaction of the lien upon the record or in the margin thereof. Failure to do this within ten days after payment shall make the lein holder liable to any person injured as a result in addition to court costs. A.C.A. § 18-44-131.
By what method does the law of this State permit the release of a lien?
Arkansas law does not specifically set out the method by which a lien my able released. However, UsLegalForm AR-06-09 is a general release form which may be used for this purpose. Also worth noting, a lien must be paid within twenty (20) days of its filing or the attorney’s fees of the party claiming the lien may be assessed against the property owner. A.C.A. § 18-44-128.
Does this State permit the use of a bond to release a lien?
Yes. Any person with an interest in the property affected by the lien may file with the circuit clerk a bond with surety in double the amount of lien claimed. The clerk is tasked with the job of notifying the lien holder of the bond. If the lien holder does not appear and question the amount of the bond or its sufficiency within three days, or the clerk finds the bond to be sufficient, the clerk shall release the lien. A.C.A. § 18-44-118.
Related Arkansas Legal Forms
- Account and Affidavit of Accounts Claiming Materialman or Labor Lien for Architect by Corporation
- Account and Affidavit of Accounts Claiming Materialman or Labor Lien for Architect by Individual
- Affidavit of Lien Account – Corporation
- Affidavit of Lien Account – Individual
- Application for List of Parties Supplying Labor or Materials – Corporate