How to Read a Mechanics' Lien
Notice as a California Contractor

What Is a Mechanics' Lien?

A mechanics' lien is a legal claim filed against a property by a contractor, subcontractor, laborer, or material supplier who was not paid for work or materials that improved that property. If the property is sold or refinanced, the lien must be paid off first — giving the unpaid party a way to collect even if the property owner tries to walk away.

In California, mechanics' lien rights are governed by Civil Code §§8000-8848 and are one of the strongest collection tools available to contractors.

The 20-Day Preliminary Notice — The Most Critical Step

Here's what many contractors don't know: to preserve your right to file a mechanics' lien in California, you must serve a 20-Day Preliminary Notice on the owner, the general contractor, and the construction lender (if any) within 20 days of first providing work or materials.

Miss this deadline and you permanently lose your lien rights for any work done more than 20 days before the notice was served. This is one of the most expensive mistakes in the construction industry.

Who Must Serve a Preliminary Notice?

• Subcontractors — yes, always required
• Material suppliers — yes, always required
• General contractors with a direct contract with the owner — not required to serve a preliminary notice, but still have lien rights
• Laborers — generally not required

How to Serve a 20-Day Preliminary Notice

1. Prepare the notice with the required information (your name, address, description of work, amount of your contract)
2. Identify all parties: the property owner, the general contractor, and any construction lender
3. Serve by certified mail, registered mail, or personal service
4. Keep proof of service — you'll need it if you ever have to enforce your lien

The Mechanics' Lien Deadline

If you haven't been paid and need to file a mechanics' lien, you must file within:

• 90 days after completion of the project (if no notice of completion was recorded)
• 30 days after a Notice of Completion or Notice of Cessation is recorded by the owner

After filing a lien, you have 90 days to file a lawsuit to enforce it — or the lien expires.

How Lien Waivers Relate to Lien Rights

Every time you accept a payment, the paying party will likely request a lien waiver — a document releasing your lien rights for that payment amount. This is normal and professional. The key is using the right type of waiver at the right time:

• Before your check clears → Conditional waiver (protects you if check bounces)
• After payment confirmed → Unconditional waiver (permanently releases rights for that amount)

California requires specific statutory lien waiver forms — generic forms don't comply. See our guide to the 4 California lien waiver forms for the full breakdown.

What to Do When You Receive a Preliminary Notice

If you're a general contractor and you receive a 20-Day Preliminary Notice from a subcontractor or supplier, this is normal — it means they're protecting their payment rights. What you should do:

• File it in your project folder
• Make sure you collect lien waivers from that sub/supplier at every payment milestone
• Track their outstanding balance carefully — you're responsible for ensuring they get paid if the owner has paid you

Sources: California Civil Code §§8000-8848. This article is for informational purposes only and is not legal advice. Consult a California construction attorney for lien-specific advice.