Chapter 311 Oregon Laws 2001

AN ACT

HB 3842

Relating to construction liens; creating new provisions; and amending ORS 87.021 and 701.250.

Be It Enacted by the People of the State of Oregon:

SECTION 1. ORS 87.021 is amended to read:

87.021. (1) Except when material, equipment, services or labor described in ORS 87.010 (1) to (3), (5) and (6) is furnished at the request of [the] an owner who is not the original contractor, a person furnishing any materials, equipment, services or labor described in ORS 87.010 (1) to (3), (5) and (6) for which a lien may be perfected under ORS 87.035 shall give a notice of right to a lien to the owner of the site. The notice of right to a lien may be given at any time during the progress of the improvement, but the notice only protects the right to perfect a lien for materials, equipment and labor or services provided after a date which is eight days, not including Saturdays, Sundays and other holidays as defined in ORS 187.010, before the notice is delivered or mailed. However, no lien is created under ORS 87.010 (5) or (6) for any services provided for an owner-occupied residence at the request of an agent of the owner.

(2) The notice required by subsection (1) of this section shall be substantially in the form set forth in ORS 87.023.

(3)(a) Except as provided in paragraph (b) of this subsection, a lien created under ORS 87.010 (1) to (3), (5) or (6) may be perfected under ORS 87.035 only to the extent that the notice required by subsection (1) of this section is given.

(b) A person who performs labor upon a commercial improvement or provides labor and material for a commercial improvement or who rents equipment used in the construction of a commercial improvement need not give the notice required by subsection (1) of this section in order to perfect a lien created under ORS 87.010. As used in this paragraph:

(A) “Commercial improvement” means any structure or building not used or intended to be used as a residential building, or other improvements to a site on which such a structure or building is to be located.

(B) “Residential building” means a building or structure that is or will be occupied by the owner as a residence and that contains not more than four units capable of being used as residences or homes.

(4) Unless otherwise agreed or the lien claimant who is required to give the notice under subsection (1) of this section is in privity with the original contractor, when a provision in an agreement for the construction of a commercial improvement requires the original contractor to hold an owner harmless or to indemnify an owner for a lien created under ORS 87.010 and perfected under ORS 87.035, that provision is not enforceable as to any lien which requires that a notice under this section be given to the owner unless a copy of the notice is delivered pursuant to ORS 87.018 to the original contractor not later than 10 days after its receipt by the owner.

SECTION 2. Section 3 of this 2001 Act is added to and made a part of ORS chapter 93.

SECTION 3. (1) If an owner of record sells real property to a purchaser, the owner shall provide to the purchaser:

(a) A list of all persons described in ORS 87.010 (1), (2), (5) or (6) with whom the owner has entered into a contract within the previous two years if the owner has not fully paid the person or the person disputes that full payment was made;

(b) A copy of a notice of right to a lien, claim of lien, pleadings to a foreclosure action, satisfaction of lien or waiver or release of a right to a lien received by the owner within the past two years; and

(c) A cautionary notice described in ORS 701.250 (3) that is provided by the Construction Contractors Board.

(2) An owner who violates subsection (1) of this section commits a Class B misdemeanor.

SECTION 4. ORS 701.250 is amended to read:

701.250. (1) Any individual may request and the Construction Contractors Board shall provide notification of the status of one or more licensees.

(2) The board may charge a standard fee for the notification described in subsection (1) of this section not to exceed the cost of preparation and provision of such notices.

(3) An individual may request and the board shall provide the individual with a cautionary notice required by section 3 of this 2001 Act that shall inform a purchaser that under certain circumstances a mortgagee or lienholder may encumber or claim a lien upon real property after a sale to the purchaser for a transaction or activity that occurred before the sale.

Approved by the Governor June 5, 2001

Filed in the office of Secretary of State June 5, 2001

Effective date January 1, 2002

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