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Mistakes in Contracting: Some of the more common construction contractor oversights and mistakes
by Levy • von Beck & Associates, P.S.

1. Accepting a subcontract that references the main contract without actually seeing the main contract.

2. Not serving a preliminary notice on a project.

3. Not verifying the Owner, Lender and other information on the preliminary notices.

4. Assuming that the "lien preparation service" company you use guarantees their work in case of their own mistakes.

5. Not tracking the lien deadline and thereby allowing lien rights to expire.

6. Accepting a promissory note from a customer and releasing the lien claim.

7. Setting up one main account rather than individual job accounts.

8. Not having the project names printed onto the invoices by the computer. Instead, it is printed or typed in after the fact, if included at all.

9. Not verifying contractor license numbers. Not updating verification on contractor license numbers.

As some of you know, we (www.TheContractorsGroup.com) were once better known as "C and D Acoustics", a California licensed suspended ceiling construction company. I used to think that sending a prelien was just a simple task, even a no brainer if you will. ;)

After much reading, however, on exactly what a preliminary notice is supposed to do for me and, even more important, just how easy it is to lose my rights to payment if I don't do every part of this "simple task" absolutely perfect, I came to realize that perfection of lien rights is a much more complicated and time-consuming process than I am equipped for.

You can spend inordinant amounts of time researching and verifying just who needs to receive a copy of your prelien, and then still lose out in the end with just one typo or even one envelope misplaced by the USPS (which unfortunately happens all too often these days). ;)

Without a thorough understanding of the statutes (which changed TWICE in the year 2001 in California) and/or the "man"power and financial resources to spend the excessive amount of time required to insure that your prelien is prepared perfectly and delivered to the correct entities, you could lose all right to payment!

Be absolutely certain that you research your information carefully and/or hire a company to do this service for you.

Part 9 of this series takes a look at LienLawOnline, a valuable asset for your "library" of helpful sites

Diane