Worker on construction site with Legal Alert: New Mexico label

On March 30, 2023, New Mexico Governor Michelle Lujan Grisham signed House Bill 179 into law. Under this new legislation, New Mexico contractors will have to take an additional step in the mechanics lien process to ensure the maximum amount of protection.

New Mexico’s lien laws will now require a copy of the lien filing to be served on the property owner to secure the right to recover interest, attorney’s fees, and court costs. Let’s take a closer look at what this legislation will require from New Mexico general contractors, subcontractors, and suppliers.

New Mexico House Bill 179: Notice of lien filings

Before this bill, New Mexico’s lien laws did not require contractors to send a notice after filing a lien claim. However, with Gov. Grisham’s signature, there is now an important incentive for contractors to provide notice to the property owner.

Bill overview:

  • Title:
  • Sponsor(s):
  • Introduced:
    • January 24, 2023
  • Effective date:
    • June 16, 2023

HB 179 creates a new subsection under N.M. Stat. 搂48-2-6, and reads as follows:

“A person filing a claim for a lien with a county clerk pursuant to Subsection A of this section shall mail, email, send by certified mail with return receipt requested or hand deliver a copy of the filed claim for a lien to the owner or reputed owner, if known, stated in the claim within fifteen days of filing the claim with the county clerk. The copy of the filed claim for a lien for lien shall be sent or delivered to owner or reputed owner at the owner or reputed owner’s last known address. If the owner or reputed owner’s address is not known, the copy of the filed claim for a lien shall be sent to the address of the owner of the property as listed in the county’s assessor’s files. The failure of the claimant to serve the notice may preclude the recovery of interest, attorney’s fees or costs.”

Breakdown of these new changes

This bill adds New Mexico to the vast majority of states that require a notice of a lien filing to be sent in order to properly perfect a mechanics lien claim. Yet, unlike a fair amount of these states, the failure to provide this notice will not affect the validity of the claim. Instead, failure to provide this notice will preclude the claimant from recovering interest, attorney fees, or court costs 鈥 which can be substantial.

Although this adds an additional step for claimants, it will operate to help all parties. Owners will receive proper notice of liens filed against their property. And, conversely, lien claimants who give notice of their claim will likely have a better chance of getting paid prior to spending the time and money on enforcement proceedings.

Even in the states where such notice is not required, like Missouri, Arkansas, and Vermont, we always recommend sending a notice and/or a copy of the claim to the property owner (and even the GC, if you’re a subcontractor) to make sure the payment dispute gets the attention it deserves. As the Fiscal Impact Report for this bill states, “The required notice to the person against whom a mechanic’s lien is filed would seem to be obvious, but sometimes the obvious needs to be stated in the statute.”

Another important thing to note is that this notice requires “a copy of the filed claim for a lien.” Sending a copy of the unrecorded claim won’t suffice. Thus, for those who are filing by mail, you should include any fees for a copy of the claim, along with a self-addressed, stamped envelope to expedite the process; as the 15 days after filing window can be tight.

Thankfully, if the NM preliminary notice is any indication, the claim will be considered served when deposited in the mail.

Also keep in mind one of the last-minute additions to this legislation: e-mail. This new law also includes e-mail as a proper form of service. This is a huge step into the modern world for the NM lien laws. See: facsimile (fax) as a form of service for preliminary notices.

As stated above, this bill will go into effect on June 16, 2023. Contractors in New Mexico must take note of these changes, to ensure that they get the most out of their mechanics liens.