Failure To File Notice Voids Lien Request
A recent federal court case again demonstrates the necessity to strictly comply with the requirements of the Ohio Mechanic’s Lien Law in order to receive the benefits. The case involved a supplier to a Contractor for improvements to a steel mill.
Pursuant to the provisions of the Ohio Revised Code, the Owner filed its Notice of Commencement with the County Recorder. While the supplier filed a lien, it failed to file a Notice of Furnishing, as the statute requires. To this, the supplier maintained that it did not have to file such a notice because the Owner never served its Notice of Commencement upon the supplier. The court disagreed with that contention, noting that under the statute, the Owner is required to serve the supplier with a Notice of Commencement only when that request is made in writing. Since no written request was made, there was no requirement that the Owner serve that Notice of Commencement.
The court also rejected other arguments that the supplier attempted to utilize in order to obtain recovery from the Owner. This included the contention that it was a “third-party beneficiary” of the contract between the Owner and the Contractor. The court disposed of that contention. Next, the supplier contended that the Owner was unjustly enriched by using the supplies furnished by the supplier. The difficulty with this argument was that the Owner had already paid the Contractor and as such, the Owner was not unjustly enriched. Indeed, the court noted that to accept the supplier’s argument would mean that the Owner had to pay twice for the same goods.
Under the Ohio Mechanic’s Lien laws, notices of Furnishing must be filed on a private work project by anyone who is not in privity of contract with the Owner. These notices must be filed if a Notice of Commencement is properly filed. This case illustrates the importance of the General Contractor making certain that a Notice of Commencement is filed with the County Recorder. It also illustrates that the supplier or Subcontractor not in privity with the Owner must request a Notice of Commencement in writing, by certified mail. Failure to follow the statutory requirements will place the supplier or Subcontractor who is not in privity of contract with the Owner in the position as the supplier in this case.
Joest Fibertech, Inc. v. Northstar Steel Co., 109 F. Supp.2d 746 (N.D. Ohio 2000).
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