Wisconsin's Construction Lien Procedures

Posted by Attorney David J. Espin / Comments

As the real estate market continues its recovery from the Great Recession, a by-product has been increased real estate construction. While this is certainly a positive trend for Wisconsin's contractors, they should have an understanding of the state's construction lien procedures in order to protect their rights if they are not paid for their work.

In Wisconsin, contractors that provide labor or materials for real estate improvements generally have lien rights against the land and improvements that they have worked on. However, in order to preserve these lien rights, contractors must carefully adhere to Wisconsin's lien filing procedures, which are summarized below.

Step 1 - Contractor Identification Notice. For certain types of properties, prime contractors must put specific language notifying the property owner of its lien rights directly in the contract with the owner.

Subcontractors must mail two signed copies of a “Subcontractor Identification Notice" to the property owner within 60 days of first furnishing labor or materials on the property. Within 10 days if its receipt, the owner must forward a copy of the notice to any lender that provides financing for the construction of the project for which the notice relates.

Step 2 - Notice of Intent to File Claim for Lien. Regardless of whether a lien claimant was required to provide a Contractor Identification Notice, if a claimant is not paid, it must provide a “Notice of Intent to File Claim for Lien" to the property owner at least 30 days prior to filing a “Claim for Lien." This notice must describe the nature of the claim, its amount, and the land and improvements to which it relates.

Step 3 - Claim for Lien. Within 6 months from the date that the lien claimant last performed, furnished, or procured labor or materials on the property, the claimant must file a “Claim for Lien" in the clerk of court's office where the property is located. The claimant must attach copies of any Contractor Identification Notice and the Notice of Intention to File Claim for Lien (along with proof of service for the same) to the Claim for Lien, and serve a copy on the property owner within 30 days of the filing.

Step 4 - Complaint for Foreclosure. Within 2 years from the date the Claim for Lien is filed, the claimant must file an action against the property owner via a state circuit court summons and foreclosure complaint. The claimant can then foreclose on the property, with the proceeds of a sheriff's sale attaching in order of lien holder priority.