How Contractors Lose Construction Lien Rights in Michigan

A construction lien is one of the most powerful collection tools a Michigan contractor has. It attaches directly to the property you improved, and it can force payment when a slow-paying owner or a general contractor higher up the chain will not return your calls. The problem is that a lien may not work if you do not perfect it correctly and on time. Michigan’s Construction Lien Act runs on a strict calendar, and missing one of the deadlines can cost you the right to collect through the property itself, even when you did the work and are owed the money.

Direct answer: Contractors lose Michigan construction lien rights most often by missing one of three deadlines under the Construction Lien Act, MCL 570.1101 et seq.: serving a Notice of Furnishing within 20 days of first work (MCL 570.1109), recording a Claim of Lien within 90 days of last furnishing labor or material (MCL 570.1111), or filing suit to foreclose within 1 year of recording (MCL 570.1117). Failing to record the claim of lien timely or failing to file suit timely will cause contractors to lose their lien outright.

What a Construction Lien Protects

Michigan’s Construction Lien Act, MCL 570.1101 et seq., gives contractors, subcontractors, suppliers, and laborers who improve real property the right to record a lien against that property if they are not paid. Done correctly, a construction lien gives you leverage that an ordinary breach of contract lawsuit does not: it clouds the owner’s title, complicates any sale or refinance, and often gets attention from an owner who has been ignoring your invoices. Done incorrectly, or too late, it may be unenforceable.

The Act is deliberately technical. Courts apply its deadlines strictly because the lien remedy is a creature of statute, not common law, and because it affects innocent third parties like lenders and title companies who rely on the public record.

Deadline One: The Notice of Furnishing

A Notice of Furnishing is a preliminary written notice—not the lien itself—that identifies a subcontractor, supplier, or laborer furnishing an improvement to real property. For claimants required to provide one, timely service is an important step in protecting construction-lien rights under the Michigan Construction Lien Act.

A subcontractor or supplier generally must serve a Notice of Furnishing on the designee and the general contractor, if any, named in the Notice of Commencement. If no designee is named, or the designee has died, the notice must instead be served on the owner or lessee named in the Notice of Commencement. MCL 570.1109 does not ordinarily require service on the construction lender, although sending the lender a courtesy copy may be prudent and service on the lender is required if the lender is also the named designee.

The notice must substantially follow the statutory form and generally must be served personally or by certified mail within 20 days after the subcontractor or supplier first furnishes labor or material. When certified mail is used, service is complete upon mailing. Keeping the mailing receipt and a copy of the notice is essential because a subcontractor’s, supplier’s, or laborer’s later Claim of Lien generally must include proof that the Notice of Furnishing was served.

A person who contracts directly with the owner or lessee is a “contractor” under the Act and is not required to provide a Notice of Furnishing to preserve lien rights arising from that direct contract. This exception is based on the contractual relationship—not merely on whether the person is informally called the “general contractor.” The exception also does not eliminate the contractor’s other obligations under the Act, including applicable sworn-statement, Claim of Lien, written-contract, and licensing requirements.

Different rules apply to laborers. A laborer generally must provide a Notice of Furnishing within 30 days after wages were contractually due but were not paid. Unpaid fringe benefits and wage withholdings are governed by a separate deadline: the fifth day of the second month following the month in which those amounts became contractually due but unpaid. A laborer’s failure to give the required notice to the designee can defeat the lien for the affected wages, fringe benefits, or withholdings. Failure to provide the notice to the general contractor does not itself defeat the laborer’s lien, but the laborer may be liable for actual damages caused to the general contractor.

Late service has a more nuanced effect for subcontractors and suppliers. Under MCL 570.1109(5), work performed and materials furnished after service of the late notice remain potentially lienable. Under MCL 570.1109(6), work and materials furnished before service also remain potentially lienable, except to the extent that the owner or lessee made qualifying payments to the contractor pursuant to a contractor’s sworn statement or a lien waiver covering the claimant’s work or materials. Michigan law therefore does not impose a simple rule limiting a late claimant to the work performed during the 20 days immediately preceding service.

For example, if a subcontractor serves its notice late but the owner has not made an intervening payment that qualifies under MCL 570.1109(6), the subcontractor may still be able to assert a lien for both pre-notice and post-notice work. If the owner paid the contractor before receiving the late notice, and the payment was made pursuant to an adequate sworn statement or lien waiver covering the subcontractor’s work, the subcontractor’s lien for the pre-notice work may be reduced—and, in some circumstances, eliminated. Timely service avoids leaving the result dependent on the project’s payment history and documentation.

The Notice of Commencement rules also differ between nonresidential and residential projects. For a nonresidential improvement, the owner or lessee generally must record a Notice of Commencement before the improvement begins. Failure to record it extends the subcontractor’s or supplier’s Notice of Furnishing deadline until 20 days after the Notice of Commencement is eventually recorded. A failure to furnish a copy in response to a proper written request creates a separate extension until 20 days after the copy is actually furnished.

Residential projects are governed by MCL 570.1108a. The owner is not generally required to record the residential Notice of Commencement. Instead, the owner or lessee must prepare and provide it after receiving a proper written request by certified mail; the requester must supply the statutory blank Notice of Commencement and attached blank Notice of Furnishing forms. If the owner, lessee, or designee fails to provide the residential Notice of Commencement as required, the Notice of Furnishing deadline is extended until 20 days after the notice is actually furnished.

A County Register of Deeds search is useful on a nonresidential project, but it is not a complete test on a residential project. The safer practice is to request the applicable Notice of Commencement promptly, identify the correct designee and general contractor, and serve the Notice of Furnishing as early as possible rather than relying on a statutory extension.

Finally, serving a Notice of Furnishing does not by itself perfect a construction lien. Among other requirements, a Claim of Lien generally must be recorded within 90 days after the claimant’s last furnishing of labor or material, and a copy of the recorded claim and associated proof of service must be served as required by MCL 570.1111. Timely notice is one piece of the statutory process, not the entire process.

Deadline Two: Recording the Claim of Lien

 A Claim of Lien must be recorded with the register of deeds in the county where the property sits within 90 days after the last date you furnished labor or material, under MCL 570.1111. This is a hard deadline measured from your last day on the job, not from your invoice date, your last payment application, or the date the owner finally stopped answering emails.

Ninety days can pass quickly when a contractor or supplier is tracking several projects with staggered completion dates. Under MCL 570.1111(1), the Claim of Lien must be recorded within 90 days after the claimant’s last furnishing of labor or material for the improvement pursuant to the claimant’s contract. The payment dispute, invoice date, project closeout, certificate of occupancy, or owner’s refusal to pay does not ordinarily determine when that period begins.

Later work does not automatically establish a new last-furnishing date merely because someone returns to the project. The controlling question is whether the later work constituted a qualifying improvement. Work that completes unfinished original-contract obligations, approved additional work, or a separately contracted repair that adds value may establish a later last-furnishing date. By contrast, warranty work performed merely to correct deficiencies in previously completed work generally does not extend the deadline—even if the callback is legitimate and performed in good faith.

The distinction does not turn simply on whether the work was called “punch-list,” “corrective,” or “warranty” work, or whether it was minor. Michigan courts examine whether the later work conferred value beyond the value furnished when the original work was completed. A contractor should therefore avoid relying on a later service call or corrective visit to make an otherwise late lien timely.

The safer practice is to calendar the 90-day deadline from the earliest reasonably supportable date on which the claimant completed its qualifying contractual work or last furnished qualifying material. Any decision to use a later date should be supported by contemporaneous records showing what was performed, why it remained part of the contracted improvement, and how it added value rather than merely correcting earlier defective work. Because Michigan requires strict compliance with the 90-day recording deadline, prudent claimants should also establish an internal deadline well before day 90.

Recording the Claim of Lien is not the last procedural step. Under MCL 570.1111(5), the claimant must, within 15 days after recording, personally serve or send by certified mail, return receipt requested, a copy of the Claim of Lien and a copy of any proof of service recorded with it to the designee at the address stated in the Notice of Commencement. If no designee was named, or the designee has died, service must be made on the owner or lessee named in the Notice of Commencement. When certified mail is used, service is complete upon mailing.

For a subcontractor, supplier, or laborer, the recorded Claim of Lien generally has attached proof of service of the Notice of Furnishing, and a copy of that recorded proof should accompany the Claim of Lien. A contractor who contracted directly with the owner or lessee generally was not required to serve a Notice of Furnishing and therefore may have no such proof to include.

Failure to comply with the 15-day service requirement can create a defense to enforcement and invite litigation over substantial compliance, actual notice, and prejudice. Although some defects involving service or proof of service may not automatically invalidate a lien, a claimant should not assume that complete nonservice will be excused. The claimant should preserve the certified-mail receipt or personal-service documentation because proof of this post-recording service must be attached to any complaint, cross-claim, or counterclaim seeking to enforce the lien.

Finally, a Claim of Lien does not remain enforceable indefinitely. Proceedings to foreclose and enforce the lien generally must be commenced within one year after the Claim of Lien was recorded under MCL 570.1117(1).

Deadline Three: Foreclosing the Lien

Recording a lien only preserves your claim; it does not collect your money. Under MCL 570.1117, you must file a lawsuit to enforce and foreclose the lien within 1 year after the date the Claim of Lien was recorded, not 1 year from your last day of work. Miss this filing deadline and the lien expires by operation of law, even though it was validly recorded.

This distinction matters because contractors sometimes confuse the 90-day recording deadline with the foreclosure deadline and assume they have a full year from the job’s completion. You do not. The foreclosure clock starts when the lien hits the public record, which may be weeks or months after you actually finished the work. Track both dates separately.

The Sworn Statement Trap

Michigan’s sworn-statement requirement, found in MCL 570.1110, operates differently from the Notice of Furnishing and Claim of Lien deadlines. A contractor generally must provide a sworn statement to the owner or lessee whenever payment is due or requested and whenever the owner or lessee demands one. A subcontractor generally must provide a sworn statement to the contractor when payment is due or requested and must provide one to the owner or lessee upon a qualifying demand.

The sworn statement identifies each subcontractor and supplier with whom the issuing contractor or subcontractor contracted for the improvement. It also identifies contracted laborers whose wages, fringe benefits, or withholdings are due but unpaid. The statutory form includes information concerning the applicable contract amounts, payments already made, amounts currently owing, and balances necessary to complete the work.

Failing to provide a required sworn statement does not automatically invalidate a recorded construction lien. For a contractor, MCL 570.1110(9) provides that the lien remains valid, but the contractor is not entitled to payment and may not file a complaint, cross-claim, or counterclaim to enforce the lien until the sworn statement has been provided. MCL 570.1110(10) similarly provides that a subcontractor’s lien remains valid despite the identified sworn-statement omission, but an enforcement action may not proceed until the statement has been furnished.

The omission is therefore generally a curable enforcement bar, not automatic destruction of the lien. Even so, recording first and attempting to supply the statement only after litigation begins is poor practice. It gives the owner or another interested party grounds to challenge the enforcement action and may produce a dispute over substantial compliance, notice, and prejudice.

Sworn statements also protect parties making project payments. An owner, lessee, designee, mortgagee, or contractor may rely on a sworn statement prepared by another party to avoid certain later claims by subcontractors, suppliers, or laborers. That protection is not absolute. A sworn statement generally cannot be used to avoid the claim of a claimant who properly provided a Notice of Furnishing or whose Notice of Furnishing requirement was excused under MCL 570.1108 or 570.1108a. The result may also depend on the accuracy and substantial compliance of the statement, the timing and basis of payments, and any applicable lien waivers.

Five Common Ways Contractors Damage Their Lien Rights

Lien rights often deteriorate through a series of ordinary administrative mistakes rather than one dramatic event:

• Calculating the 90-day recording deadline from the invoice date, payment dispute, inspection, or last site visit instead of the claimant’s last qualifying furnishing of labor or material for the improvement pursuant to its contract.
• Assuming that the direct-contract contractor’s exemption from the Notice of Furnishing requirement also protects that contractor’s subcontractors or suppliers. The exemption applies to lien rights arising from the contractor’s own direct contract with the owner or lessee; it does not pass down the contracting chain.
• Confusing the one-year deadline to commence lien-foreclosure proceedings with the limitations period governing a separate breach-of-contract claim. The two remedies and their deadlines operate independently. A viable contract claim does not preserve an expired construction lien.
• Failing to investigate the applicable Notice of Commencement procedure. On a nonresidential project, failure to record the Notice of Commencement can extend the Notice of Furnishing deadline. On a residential project, the owner ordinarily must prepare and furnish the Notice of Commencement after receiving a proper written request accompanied by the required blank forms.
• Recording a Claim of Lien but failing to complete the required post-recording service within 15 days. Although some defects may be evaluated under substantial-compliance principles, complete or prejudicial noncompliance can seriously impair enforcement and should never be treated as harmless.

Why This Matters for Michigan Contractors in Metro Detroit

Projects in Oakland, Wayne, Macomb, and Washtenaw Counties often proceed quickly, while payment disputes emerge only after crews and project managers have turned their attention elsewhere. By the time an owner or general contractor begins delaying payment, several lien-related deadlines may already be approaching.

Michigan courts require strict compliance with the 90-day Claim of Lien recording deadline. A lien recorded after that period ordinarily ceases to exist, even if it is only one day late. Other requirements—including sworn statements and post-recording service—may permit substantial-compliance analysis in appropriate circumstances, but contractors should not plan their compliance around the hope that a court will excuse a defect.

A missing sworn statement should not be equated with a late Claim of Lien. The late recording ordinarily extinguishes the lien. A missing sworn statement generally leaves the lien valid but prevents payment or enforcement until the defect is cured. Both problems are serious, but they have different consequences.

The practical answer is to incorporate Construction Lien Act compliance into ordinary project administration. Notices of Commencement, Notices of Furnishing, sworn statements, lien waivers, last-furnishing records, Claim of Lien deadlines, and service receipts should be tracked with the same discipline applied to insurance certificates, permits, change orders, and payment applications.

Contractor Takeaway

Do not wait for a payment dispute before evaluating lien rights. Track the following compliance events on every project:

1. Determine whether the project is residential or nonresidential and obtain or request the applicable Notice of Commencement.
2. Record the first date on which labor or material is furnished and calculate the presumptive Notice of Furnishing deadline.
3. Identify every event requiring a contractor’s or subcontractor’s sworn statement, including payment requests, payments becoming due, and owner demands.
4. Document the last qualifying furnishing of labor or material and calculate the 90-day Claim of Lien recording deadline from the earliest defensible completion date.
5. If a Claim of Lien is recorded, calendar the 15-day post-recording service deadline immediately and preserve proof of service.
6. Calendar the one-year deadline for commencing lien-foreclosure proceedings from the date the Claim of Lien was recorded.

Because the last-furnishing date and the effect of later work can be fact-sensitive, contractors should obtain advice from Michigan construction-lien counsel well before a disputed deadline expires—not after the calendar has already delivered its verdict.

Frequently Asked Questions About Michigan Notices of Furnishing and Construction Liens

Protect Your Lien Rights Before the Deadlines Expire — Contact Szura & Delonis, PLC

Michigan construction-lien rights can be lost or substantially reduced before a payment dispute fully develops. Serving the wrong party, miscalculating the Notice of Furnishing deadline, relying on warranty work to extend the 90-day recording period, or missing a post-recording requirement can turn a valuable payment remedy into an expensive argument over an invalid or impaired lien.

At Szura & Delonis, PLC, our Michigan construction law attorneys help contractors, subcontractors, and suppliers throughout Oakland, Wayne, Macomb, Washtenaw, and Livingston Counties protect their payment rights. We advise clients regarding Notices of Commencement, Notices of Furnishing, sworn statements, lien waivers, last-furnishing dates, Claims of Lien, and lien-enforcement proceedings.

If you need to determine whether a Notice of Furnishing is required, are unsure when your 90-day recording period began, have been asked to provide a sworn statement or lien waiver, or are facing a construction payment dispute, call us at (248) 716-3600 or contact us online. We respond quickly because Michigan construction-lien deadlines continue to run while the parties debate payment.

This article is provided for general educational and informational purposes only. It does not constitute legal advice and does not create an attorney-client relationship between the reader and Szura & Delonis, PLC. Michigan construction law involves complex statutory requirements and fact-specific analysis. Do not rely on this content as legal advice for your specific situation. If you have a time-sensitive construction law matter, consult a qualified Michigan construction attorney immediately.

About the Author

Richard M. Delonis is a Michigan construction, business, and real estate attorney at Szura & Delonis, PLC in Southfield, serving clients throughout Metro Detroit. He advises construction managers, general contractors, subcontractors, suppliers, and property owners on lien rights, collections strategy, contract disputes, and project-risk issues.